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Country Forecast United Kingdom Updater Product Image

Country Forecast United Kingdom Updater

  • ID: 2105423
  • December 2014
  • Region: United Kingdom, Great Britain
  • 19 Pages
  • The Economist Intelligence Unit

The governing coalition of the centre-right Conservative Party and the centre-left Liberal Democrats has a solid majority in parliament. We expect the government to last until 2015, when the next general election is due. The most likely election outcome is that, as in 2010, neither of the two main parties (Conservative/Labour) will secure a parliamentary majority. Another coalition is therefore likely. But the process of forming a stable government will be more complicated than in 2010. A period of moderate instability seems likely after the election (scheduled for May 2015) if inter-party negotiations-particularly on the controversial issue of the UK's membership of the EU-are required before a government can be formed and a set of policy priorities agreed upon.

The election itself will be fought on the strength of the economic recovery and on the two main parties' economic policies. Another Conservative-led government would maintain the current strategy of fiscal austerity and public-sector reform. Labour promises an interventionist approach to the economy and to the increasing cost of living and corporate vested interests in particular.

The successes of the UK Independence Party (UKIP) have continued. On November 20th Mark Reckless won the Rochester and Strood by-election, becoming UKIP's second parliamentarian. The result was especially pertinent given the political energy spent by the Conservatives in defending the seat. The Economist Intelligence Unit considers a referendum on UK membership of the EU to be more likely than not during the next parliament. We expect continued UK membership, but if UKIP builds further momentum at the general election and beyond then the possibility of a UK exit has to be acknowledged.

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Country Forecast United Kingdom Updater

Country forecast overview: Highlights

Country forecast overview: Key indicators

Country forecast overview: Business environment rankings

Country forecast overview: United Kingdom's business environment at a glanc
Policy towards private enterprise and competition
Policy towards foreign investment
Foreign trade and exchange controls
Taxes
Financing
The labour market
Infrastructure

Fact sheet

Outlook for 2015-19: Political stability

Outlook for 2015-19: Election watch

Outlook for 2015-19: International relations

Outlook for 2015-19: Policy trends

Outlook for 2015-19: Fiscal policy

Outlook for 2015-19: Monetary policy

Outlook for 2015-19: Economic growth

Outlook for 2015-19: Inflation

Outlook for 2015-19: Exchange rates

Outlook for 2015-19: External sector

Data summary: Global outlook

Data summary: Gross domestic product, current market prices

Data summary: Gross domestic product, at constant prices

Data summary: Gross domestic product by sector of origin

Data summary: Growth and productivity

Data summary: Economic structure, income and market size

Data summary: Fiscal indicators

Data summary: Monetary indicators

Data summary: Employment, wages and prices

Data summary: Current account and terms of trade

Data summary: Foreign direct investment

Data sources and definitions
Global data
Domestic data
Abbreviations

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Note: Product cover images may vary from those shown

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