With the UK preparing to agree its future trading relationships with both the EU and the rest of the world, our chart this week takes a look at the global economy.
It illustrates the scale of EU and EEA single market that will continue to be the UK’s largest trading partner, it also shows the scale of the US economy, with expected GDP of £15.0tn in 2018, followed by China (GDP £10.3tn) and Japan (GDP £3.6tn). All important current and future trading partners for Britain.
As practical accountants we have converted GDP into sterling using current exchange rates, rather than the notional purchasing power parity (PPP) exchange rates beloved of economists. This shows the extent to which Britain continues to punch well above its weight. Despite a population of only 67 million – 0.87% of the world – the UK accounts for 3.3% of the global economy.
Future UK trade is also likely to focus on the rapidly growing ASEAN region in South East Asia (GDP £2.7tn); India (GDP £2.2tn); and Brazil (GDP £1.6tn), all likely to grow their share of the global economy significantly in coming years.
The UK has a lot to play for in its forthcoming trade talks, but it is also a significant trading partner and a large market in its own right.