The UK is experiencing the worst economic scenario in the last 50 years. At the same time, the political context generates instability and hinders the British recovery. The isolation due to Brexit – the exit from the European Union – with a shortage of truck drivers and other professionals due to the closing of doors to migrant workers, along with the consequences of the pandemic and the conflicts that led to the resignation of Boris Johnson carry the United Kingdom into the atypical situation of uncertainty regarding the future of the island nation.
National Health Service (NHS) officials have warned of the risk of impoverishment of the population and a humanitarian crisis. According to the End Fuel Poverty Coalition, around 10.5 million households will be in a “poverty level” by the beginning of next year in the UK. The British government defines “poverty” as when the annual family income is less than 60% of the country’s average salary, which was 31 thousand pounds a year (about 187 thousand reais) in 2021, according to official statistics.
At the same time, the Danish bank Saxo announced that the British could regress to “emerging market” status. The institution’s director of analysis, Christopher Dembik, announced earlier this month that the UK could enter a recession in the last quarter of 2022. This situation could last, according to him, for five other quarters and make the nation’s GDP down about 2.1%.
Although the economic crisis is not just a local problem, the United Kingdom has the worst rates among the seven richest countries in the world (from the G7). The annual inflation rate is above 10% and a peak of 13% is expected in October, according to the Bank of England. The American bank Citi predicts that, in 2023, British inflation will reach 18%.
The UK’s debt, which exceeded two trillion pounds sterling (more than 12 trillion reais) in the pandemic, could more than triple if the government does not hold back fiscal policy and gets close to 320% of GDP in 50 years, as advised by Her Majesty’s Revenue and Customs (HMRC).
The International Monetary Fund (IMF) predicts that the British will have the lowest growth among the seven richest countries in 2023. In the pocket of more than 67 million inhabitants, the situation is already weighing. Spending cuts and lifestyle changes have become a reality for most families and are expected to reach more than 20% of them by the beginning of next year.
Since the 1990s, the island countries have not experienced such strong social protests. There is a movement to strike the payment of energy bills called “Don’t pay UK” (“Don’t pay the UK”), after the highs resulting from the energy crisis, which could reach up to 87% in October, according to the consultancy help.
At the same time, almost 2,000 members of the Unite union – operators of cranes, machines and stevedores – decided on Sunday (21) to stop work at the port of Felixtowe, the busiest in Great Britain and responsible for 48% of movements, for eight days. of containers from the island countries.
Employees of subways, trains, buses and universities have also crossed their arms asking for a salary change in the face of a drop of at least 3% in purchasing power. “We just want an increase that goes along with the cost of living, so that we can buy in 2022 what we could buy in 2021,” Mick Whelan, general secretary of the Aslef union, which represents 21,000 train drivers, said during the strike earlier this month. , in a press conference.
“People are in difficult financial situations. I see a lot of despair,” said Steve Garelick, representative of the UK’s largest union, the GMB Union, during protests by Amazon workers in Tilbury, east of London. “It’s the summer of discontent,” he added, using a term that refers to the “winter of discontent” of 1979, when England had a widespread shutdown: from factory workers to garbage collectors and gravediggers.
Race for prime minister brings little hope
The scenario should change little with the election of a replacement to Johnson on the 5th. Two candidates are vying for votes: the favorite in the polls and current Foreign Minister, Liz Truss, and the former Chancellor of the Exchequer Rishi Sunak. In recent weeks, Truss has lashed out at striking workers, stressing that “British people need to work harder”.
In an interview with the tabloid The Sun on Sunday, Truss made no concrete proposals to fight inflation. “We hear all too often that there is going to be a recession. I don’t believe that is inevitable. We can generate opportunities here in the UK,” commented the candidate.
The first action, according to her, would be to cut taxes, an alternative criticized by the opponent Sunak. He proposes direct financial aid to the population without, however, describing how it would be possible to do this in the current economic scenario.
Whoever occupies the prime minister’s seat will not have much leeway to offset the impact of rising energy and food prices. And any movement could weigh even more on the population’s pocket.
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