Economy of the United Kingdom - overview

The United Kingdom has a fiercely independent, developed, and international trading economy that was at the forefront
of the 19th-century Industrial Revolution. The country emerged from World War II as a military victor but with a
debilitated manufacturing sector. Postwar recovery was relatively slow, and it took nearly 40 years, with additional
stimulation after 1973 from membership in the European Economic Community (ultimately succeeded by the European
Union), for the British economy to improve its competitiveness significantly. Economic growth rates in the 1990s
compared favourably with those of other top industrial countries. Manufacturing’s contribution to GDP has declined to
about one-fifth of the total, with services providing the source of greatest growth. The United Kingdom’s chief trading
ties have shifted from its former empire to other members of the EU, which account for more than half its trade
in tangible goods. In 2020, the UK left the European Union, which influenced the trade with the EU countries. The United
States is a major investment and trading partner, and Japan has become a significant investor in local production.
American and Japanese companies often choose the United Kingdom as their European base. In addition, other fast-
developing East Asian countries with export-oriented economies include the United Kingdom’s open market among their
important outlets.
During the 1980s the Conservative government of Margaret Thatcher pursued the privatization, or denationalization, of
publicly owned corporations that had been nationalized by previous governments. Privatization, accompanied by
widespread labour unrest, resulted in the loss of tens of thousands of jobs in the coal-mining and heavy industrial sectors.
Although there was some improvement in the standard of living nationally, in general there was greater prosperity in the
South East, including London, than in the heavily industrialized regions of the West Midlands, northern England,
Clydeside, and Belfast, whose economies suffered during the 1980s. During the 1980s and ’90s, income disparity also
increased. Unemployment and inflation rates were gradually reduced but remained high until the late 1990s. The
country’s role as a major world financial centre remained a source of economic strength. Moreover, its exploitation of
offshore natural gas since 1967 and oil since 1975 in the North Sea has reduced dependence on coal and imported oil and
provided a further economic boost.

AGRICULTURE, FORESTRY, AND FISHING

Agriculture
The United Kingdom is unusual, even among western European countries, in the small proportion of its employed
population (about 2 percent) engaged in agriculture. With commercial intensification of yields and a high level of
mechanization, supported initially by national policy and subsequently by the Common Agricultural Policy (CAP) of the
EU, the output of some agricultural products has exceeded demand. Employment in agriculture has declined gradually,
and, with the introduction of policies to achieve reduction of surpluses, the trend is likely to continue. Efforts have been
made to create alternative employment opportunities in rural areas, some of which are remote from towns. The land area
used for agriculture (about three-quarters of the total) has also declined, and the arable share has fallen in favour of
pasture.
The most important farm crops are wheat, barley, oats, sugar beets, potatoes, and rapeseed. While significant proportions
of wheat, barley, and rapeseed provide animal feed, much of the remainder is processed for human consumption through
flour milling (wheat), malting and distilling (barley), and the production of vegetable oil (rapeseed). The main livestock
products derive from cattle and calves, sheep and lambs, pigs, and poultry.
Most UK agriculture is intensive and highly mechanised, with the use of chemical fertilisers and insecticides routine.
East Anglia and South East England have been centres for grain production, with some areas of South East England
also specialising in market gardening.

Dairy farming
This involves the rearing or purchase of cattle for the production of milk. It is mainly found in south-western England, the
lowland areas of Wales and in Lancashire.
Arable farming
Arable farmers plough the land to produce cereal crops such as wheat and barley, vegetables, oil seed rape and linseed.
Arable farms are mainly found in eastern England, including Norfolk and Lincolnshire, as well as the east of Scotland.
Sheep farming
Sheep produce meat and wool. Sheep farms, which are mainly family run, are found in the upland marginal and
peripheral areas of England, Wales and Scotland.
Market gardening
This is intensive farming, producing high-quality crops such as fruit, salad, vegetables and flowers. It can be found in
Cornwall and Devon, the Isles of Scilly, the Fens and the county of Kent.
Forestry
About one-tenth of the United Kingdom’s land area is devoted to productive forestry. The government-supported Forestry
Commission manages almost half of these woodlands, and the rest are in private hands. Domestic timber production
supplies less than one-fifth of the United Kingdom’s demand. The majority of new plantings are of conifers in upland
areas, but the commission encourages planting broad-leaved trees where appropriate.

Fishing
Although the United Kingdom is one of Europe’s leading fishing countries, the industry has been in long-term decline.
Fishing limits were extended to 200 nautical miles (370 km) offshore in the mid-1970s, and, because a significant part of
the area fished by other EU members lies within British waters, it has been necessary to regulate catches on a community-
wide basis. Meanwhile, the United Kingdom has lost opportunities to fish in some more-distant waters (e.g., those off
Iceland), and this has reduced its total catch more than those of other countries of the EU. After leaving the EU, there
have been constant arguments between the UK and France over their fishing areas. The United Kingdom’s fishing
industry now supplies only half the country’s total demand. The most important fish landed are cod, haddock, mackerel,
whiting, and plaice, as well as shellfish, including Nephrops (Norway lobsters), lobsters, crabs, and oysters. Estuarine fish
farming—mainly of trout and salmon—has expanded considerably.

RESOURCES AND POWER

Minerals
The United Kingdom has relatively limited supplies of economically valuable mineral resources. The once-important
extraction of iron ore has dwindled to almost nothing. Other important metals that are mined include tin, which supplies
about half the domestic demand, and zinc. There are adequate supplies of nonmetallic minerals, including sand and
gravel, limestone, dolomite, chalk, slate, barite, talc, clay, celestine, and gypsum. Sand, gravel, limestone, and other
crushed rocks are quarried for use in construction.

Energy
By contrast, the United Kingdom has larger energy resources—including oil, natural gas, and coal—than any other EU
member. Coal, the fuel once vital to the British economy, has continued to decrease in importance. Compared with its
peak year of 1913, when more than one million workers produced more than 300 million tons, current output has fallen
by more than four-fifths, with an even greater reduction in the labour force. Power stations are the major customers for
coal, but, with growth in the use of other fuels and the increasing closing of pits that have become uneconomical to
operate, the industry remains under considerable pressure.
The discovery of oil in the North Sea and the apportionment of its area to surrounding countries led to the rapid
development of oil exploitation. Since the start of production in 1975, the quantities brought ashore have grown each
year, and the United Kingdom has become virtually self-sufficient in oil and even an exporter. With an average output of
nearly three million barrels per day at the beginning of the 21st century, the country was one of the world’s largest
producers. The balance of payments has benefited considerably from oil revenues, and a substantial proportion has been
invested abroad to offset diminishing oil income in the future. Proven reserves were estimated at around 700 million tons
in the late 1990s.
Since offshore natural gas supplies from the North Sea began to be available in quantity in 1967, they have replaced the
previously coal-based supplies of town gas. A national network of distribution pipelines has been created. Proven reserves
of natural gas were estimated at 26.8 trillion cubic feet (760 billion cubic metres) in the late 1990s.
Self-sufficiency in oil and natural gas and the decline of coal mining has transformed Britain’s energy sector. Nuclear fuel
has slightly expanded its contribution to electricity generation, and hydroelectric power contributes a small proportion
(mainly in Scotland), but conventional steam power stations provide most of the country’s electricity.

Manufacturing
The manufacturing sector as a whole has continued to shrink both in employment and in its contribution (now around
one-fifth) to the GDP. The decline in manufacturing largely accounted for the rapid rise in unemployment in the early
1980s. Once economic growth returned, however, there was great improvement in productivity and profits in British
manufacturing.
In terms of their relative importance to the GDP, the most important manufacturing industries are engineering; food,
beverages (including alcoholic beverages), and tobacco; chemicals; paper, printing, and publishing; metals and minerals;
and textiles, clothing, footwear, and leather. The fastest-growing sectors have been chemicals and electrical engineering.
Within the chemical industry, pharmaceuticals and specialty products have shown the largest increases. Within the
engineering industry, electrical and instrument engineering and transport engineering—including motor vehicles and
aerospace equipment—have grown faster than mechanical engineering and metal goods, and electronic products have
shown the fastest growth. On the other hand, the growth in motor vehicle production has occurred among foreign-owned,
especially Japanese, companies investing in the United Kingdom. British automobile manufacturers have been in decline
since the 1970s. After a period of restructuring during the 1980s, the British steel industry substantially increased its
productivity, output, and exports during the 1990s. However, food, beverages, tobacco, leather, and engineering as a
whole have had below-average growth. Textiles, clothing, and footwear have been in absolute decline because British
companies have faced increasing difficulty competing with imports, especially from Asia.
During the 1980s imports of manufactured products increased dramatically, and, although exports of finished
manufactured products increased in value, the surplus in the balance of trade disappeared and was transformed into a
large deficit. Nevertheless, after a period of restructuring in the 1980s, Britain’s manufacturing sector increased its
productivity and competitiveness, and the trade balance improved and stabilized during the 1990s.
Construction in Britain stagnated during the 1990s because of a decline in prices and in demand for new housing and
because of decreased government investment in infrastructure during the first half of the decade. About half the labour
force in construction is self-employed. More than half of all construction work is on new projects, the remainder on repair
and maintenance. There has been a marked switch from housing funded and owned by public authorities toward private
development.
Private industrial and commercial construction and public projects account for the remainder of construction. During the
1980s and ’90s the United Kingdom embarked on a series of major infrastructure projects, including the Channel
Tunnel between Britain and France, the rebuilding of large parts of London’s traditional Docklands as a new commercial
centre, and extensions to London’s rail and Underground systems.

A map of the major UK cities gives a good picture of where manufacturing flourished, and often specialisations could be
identified, in particular:
• Birmingham, (automotive)
• Glasgow (shipbuilding),
• London (various),
• Manchester (textiles),
• Newcastle (shipbuilding and steel),
• Nottingham (apparel, medicine),
• Sheffield (steel and steel products)
• Sunderland (shipbuilding and coal-mining)
• Leeds (textiles and engineering)
• Belfast (shipbuilding and textiles)
• Cardiff (steel)

The automotive industry can be traced back to the 1890s (growing after World War I), by which time industries such as
shipbuilding, textiles and steel were already established.
In the inter-War years modern industries emerged, with aerospace forming clusters around London, Bristol and in
Hertfordshire. The Hertfordshire cluster no longer exists. The early electronics industry generally preferred the south.
Today there is no heavy manufacturing industry in which UK-based firms can be considered world leaders and no product
in which a UK city or region is the world leader.
However, the Midlands, in particular, remains a strong manufacturing centre, with around a fifth of employment
dependent on manufacturing.
More recently, high technology firms have concentrated largely along the M4 motorway, partly because of access to
London Heathrow Airport, but also because of the economies of agglomeration. However, the general pattern remains
that the south has lower, and falling, reliance on manufacturing.

Finance
The United Kingdom, particularly London, has traditionally been a world financial centre, although this was to some
extent undermined as a result of Brexit.
At the end of the 20th century, the financial services industry employed more than one million people and contributed
about one-twelfth of the GDP. Although financial services have grown rapidly in some medium-sized cities,
notably Leeds and Edinburgh, London has continued to dominate the industry and has grown in size and influence as a
centre of international financial operations. Capital flows have increased, as have foreign exchange and securities trading.
Consequently, London has more foreign banks than any other city in the world. Increased competition and technological
developments have accelerated change.
Now, the UK financial industry is concentrated overwhelmingly in the City of London and Canary Wharf, with back
office and administrative operation often dispersed around the south of England.
London is one of the world's great financial centres, which is one of the factors that is commonly considered to make it a
world city. Central London contains some of the most expensive commercial property in the world because of this.
From around the early 1990s London has been able to boast of having more U.S. banks than New York, as well as being
host to branches of more than five hundred overseas banks. It is the principal financial centre of the world, ranked
alongside New York and Tokyo as one of three where any serious financial player must be represented.
The City of London has around 300,000 employees, largely concentrated in the financial and professional sectors.
Within London, the desire for banks to be there put pressure on the City of London's ability to accommodate them. In the
mid-1980s a crisis point was reached and, although the City was able to expand its stock of modern office space, this did
not happen before Canary Wharf had been set up as a competitor. The irony is that Canary Wharf was built in the London
Docklands that had, until 1970, been among the largest docks in the world. All manner of goods had been shipped from
the factories of east London to the world; between 1961 and 1993 manufacturing employment in London fell from 1.6
million to 328,000.
During the mid-90's, Leeds took advantage of the internet's arrival as part of the .com boom. It became the UK's first city
to have full broadband and digital coverage, making it a very attractive place for corporations to expand, particularly
when opening call centres. During the changing 1990's, Leeds had better connections to London than any other UK city,
being 2 hours from London by train. As a result, it is now the UK's 2nd largest financial and legal centre and the UK's
largest e-business sector with more than 1/3 of the UK's internet traffic passing through the city.
In this respect, Canary Wharf and Leeds are arguably more symbolic of the changed economic geography of the UK than
any other place.

The Bank of England retains the sole right to issue banknotes in England and Wales (banks in Scotland and Northern
Ireland have limited rights to do this in their own areas). The bank’s standing instruction from the government is to set an
interest rate that will meet a target inflation rate of 2.5 percent per annum. The bank also intervenes actively in foreign
exchange markets and acts as the government’s banker. The pound sterling is a major internationally traded currency.
A variety of institutions, including insurance companies, pension funds, and investment and unit trusts, channel individual
savings into investments. Finance houses are the primary providers of home mortgages and corporate lending and leasing.
There are also companies that finance the leasing of business equipment; factoring companies that provide immediate
cash to creditors and subsequently collect the corporate debts owed; and finance corporations that provide venture capital
funding for innovations or high-risk companies and that supplement the medium- and long-term capital markets,
otherwise supplied by the banks or the Stock Market.

The United Kingdom has a number of organized financial markets. The London Stock Exchange (LSE) is the primary
stock exchange in the U.K. and the largest in Europe. The Financial Times Stock Exchange (FTSE) 100 Share Index, or
"Footsie", is the dominant index, containing 100 of the top blue chips on the LSE. The securities markets comprise the
London Stock Exchange, which deals in officially listed stocks and shares; the Unlisted Securities Market, for smaller
companies; and the Third Market, for small unlisted companies.

The share of invisible trade (receipts and payments from financial services; interest, profits, and dividends; and transfers
between the United Kingdom and other countries) has been rising steadily since the 1960s—from about one-third to one-
half of the country’s total foreign earnings. Within this area, service transactions have grown rapidly, and financial
services have grown the fastest.

UK ECONOMY AT PRESENT

The economy of the United Kingdom is highly developed and market-oriented. It is the fifth-largest national economy in
the world measured by nominal GDP, ninth-largest by PPP, and twenty fifth-largest by GDP per capita, comprising 3.3%
of world GDP.

GDP Composition by sector of origin in the UK

(2015)
The services sector, in particular banking and insurance, is the UK’s strongest sector. Especially the Greater London area
is a financial hub with many working opportunities.

The UK is the world’s eleventh biggest manufacturing nation, with the civil and military aerospace and the
pharmaceutical industry of particular importance.

The south of England as well as the Greater London area are the motor of the UK economy.

The economy of the UK was hit hard by the global financial crisis of 2008. Only through many different attempts at
stimulating the economy while cutting down on public expenditures and raising taxes was it possible for the UK to get
back to a stabilized, albeit weakened, economy. Brexit and the pandemic were the next factors weakening the British
economy, resulting in what we can observe today: petrol crisis and shortage of employees

The UK strong service sector

The economy of the UK today is overwhelmingly fueled by the strength of its services sector, which accounts for some
79% of the total GDP. The most significant services are banking, insurance, and business services. Many of the biggest
names in this sector in the UK are household names worldwide — think HSBC, for example.

The UK is among the most globalized places in the world, ranking 20th on the 2016 KOF Index of Globalization. One
region is of particular importance in this regard: the Greater London area is home to the European and worldwide
headquarters, as well as branch offices, of dozens of multinationals, earning its rightful place among Tokyo and New
York as one of the main centers of the global economy and finance.

Still important to the economy: Industry and Agriculture

Despite the decline in the past years, the manufacturing sector still plays an important role in the UK’s economy and
manages to contribute 21% to the GDP. The UK is the world’s eleventh biggest manufacturing nation and some of the
industries located or headquartered in the UK are of major importance on a global scale, particularly the civil and military
aerospace industry (BAE Systems, Rolls Royce) and pharmaceuticals (GlaxoSmithKline, AstraZeneca).

Furthermore, the automotive and construction industries are among the largest employers of UK residents, employing
nearly five million people between them. Mining also contributes its share to the economy of the UK. The nation’s coal,
gas, and oil reserves are of great importance, but declining in quantity — the UK has had to rely on energy imports since
around the middle of the past decade.

Agriculture may be the least important sector in terms of GDP contribution, but it is still of vital importance for Britain
and Northern Ireland. As agriculture is not only highly mechanized and intensive, but also very effective, the men and
women working in the primary sector are able to produce enough to meet about 60% of the food demand of the entire
nation.

Regional Disparities throughout the Kingdom

The southern part of England, and Greater London in particular, is the biggest motor for the economy of the UK.
Unsurprisingly, this is also the priciest region to live in. The northern part of England has overcome much of the negative
reputation it held after the decline of the local industry sector by diversifying its economy considerably.

Glasgow and Edinburgh, both profit from their modern, service-based economies. The GVA per capita of Scotland is
slightly below UK average; however, if oil and gas revenues are included (the nation is the EU’s largest oil producer),
Scotland only trails Greater London in this regard. The economies of Northern Ireland and Wales are both similarly small,
mainly due to their geographical and demographic size. The former also has had to cope with the internal struggles during
the Troubles, which have had negative effects on the economy noticeable even today.

THE UK ECONOMY BY REGIONS:

England:

England is highly industrialised. Many important inventions, such as the invention of the steam engine by James Watt
were made by Englishmen.
The development of industry has concentrated mainly in the north, in Lancashire and Yorkshire. This two cities were
first at home in the woolen industry, based originally on the sheep of the Pennines.
London is the biggest port in spite of the fact it is not situated on the coast. The river Thames is deep enough and the
ships can go as far as London. There is food industry, clothing industry, chemical industry, light engineering, printing
industry and production of the furniture etc.
Manchester used to be a major industrial and commercial centre as early as in the middle of 19th century. Now it has a
variety of industries, particularly engineering.
Newcastle upon Tyne is the centre of industry based on coal, iron, steel and shipbuilding.
Birmingham, the centre of the West Midlands, and the second largest city of England, has developed light engineering.
England is an important producer of textiles and chemical products. Although automobiles, locomotives, and aircraft are
among England's other important industrial products, a significant proportion of the country's income comes from the
City of London. Since the 1990s, the financial services sector has played an increasingly significant role in the English
economy and the City of London is one of the world's largest financial centres.

The service sector of the economy as a whole is now the largest in England, with manufacturing and primary industries in
decline. The only major secondary industry that is growing is the construction industry, fueled by economic growth
provided mainly by the growing services, administrative and financial sector.

Scotland:

In the late 20th century heavy industry declined, leading to a shift in the economy of Scotland towards technology and the
service sector. The 1980s saw an economic boom in the Silicon Glen corridor between Glasgow and Edinburgh, with
many large technology firms relocating to Scotland.

Scottish-based companies have strengths in information systems, defence, electronics, instrumentation and
semiconductors. There is also a dynamic and fast growing electronics design and development industry. Other major
industries include banking and financial services, construction, education, entertainment, biotechnology, transport
equipment, oil and gas, whisky, and tourism. Edinburgh is the financial services centre of Scotland, with many large
financial firms based there, and is famous for the engineering, printing and electronic industries. Glasgow is the fourth
largest manufacturing centre in the UK, accounting for well over 60% of Scotland's manufactured exports. Shipbuilding,
although significantly diminished from its heights in the early 20th century, is still a large part of the Glasgow economy.
Aberdeen, a busy seaport, the main centre of the Scottish fishing industry, and the commercial capital of northeast
Scotland, is also the centre of North Sea offshore oil and gas production, with giants such as Shell and BP housing their
European exploration and production HQs in the city. Other important industries in Scotland include textile production,
chemicals, distilling, agriculture, brewing and fishing.

Northern Ireland:

Northern Ireland previously had a traditionally industrial economy, most notably in shipbuilding, rope manufacture and
textiles, but most heavy industry has since been replaced by services. Heavy industry is concentrated in and around
Belfast, although other major towns and cities also have heavy manufacturing areas. Machinery and equipment
manufacturing, food processing, textile and electronics manufacturing are the leading industries. Other industries such as
papermaking, furniture manufacturing, aerospace and shipbuilding are also important, concentrated mostly in the eastern
parts of Northern Ireland.

Chief exports of Northern Ireland are ships, aircraft, linen textiles, and also agricultural products and livestock as the
country is largely agricultural. There are small farms producing pigs, cattle, milk and eggs. The principal crops are
potatoes, barley, and oats.

Wales:

Wales’s GDP per capita and employment rates are far below average for the United Kingdom.
Manufacturing accounts for nearly one-third of the GDP of Wales, although most heavy industries had declined by the
late 20th century (coal is the only significant mineral resource of Wales, but the local coal-mining industry is now
diminished from its previous level; by the early 2010s only about 1,200 people continued to be employed in coal mining
in Wales), replaced by foreign-owned companies specializing in electrical, automotive, and chemical products.
Wales has a diverse manufacturing sector. Metal ore refining is a long established industry in Wales. Nearly all the
tinplate and much of the aluminium produced in the UK are made in Welsh plants.Wales is an important producer of
automotive components and one of the world's major suppliers of titanium for jet engine blades and medical applications.

Foodstuffs, metals and metal products, beverages, and optical equipment are also important.
Exercises:

I. Mark all regions cities and other landforms in bold on the map.
Explain the abbreviations
1 GDP
2 EEC
3 EU
4 CAP
5 GVA
6 LSE
7 FTSE
8 GDP per capita
9 PPP

II. Give characteristic features of the UK agriculture:

1 employment in agriculture
2 characteristic features of UK
agriculture
3 main crops
4 main agricultural regions
The United Kingdom is unusual, even among western European countries,
in the small proportion of its employed population (about 2 percent)
engaged in agriculture
With commercial intensification of yields and a high level of
mechanization, supported initially by national policy and subsequently by
the Common Agricultural Policy (CAP) of the EU, the output of some
agricultural products has exceeded demand.
The most important farm crops are wheat, barley, oats, sugar beets,
potatoes, and rapeseed
East Anglia and South East England have been centres for grain
production, with some areas of South East England also specialising in
market gardening.

III. Give the following:

1 the major reason for the decline in the
UK’s fishing industry
2 name the most important fish landed
The United Kingdom has lost opportunities to fish in some
more-distant waters (e.g., those off Iceland), and this has
reduced its total catch more than those of other countries of the
EU. After leaving the EU, there have been constant arguments
between the UK and France over their fishing areas.
The most important fish landed are cod, haddock, mackerel,
whiting, and plaice,

IV. Give the following:

1 the main mineral resources
2 the main energy resources
Iron ore, tin, which supplies about half the domestic demand,
and zinc. There are adequate supplies of nonmetallic minerals,
including sand and gravel, limestone, dolomite, chalk, slate,
barite, talc, clay, celestine, and gypsum.
The United Kingdom has energy resources—including oil,
natural gas, and coal.

3 the main regions with natural resources

The North Sea, Scotland, Wales, Northern England

V. Give the following:

1 contribution of manufacturing sector to
GDP
2 the main industries
The manufacturing sector as a whole has continued to shrink
both in employment and in its contribution (now around one-
fifth) to the GDP
The most important manufacturing industries are engineering;
 food, beverages (including alcoholic beverages), and tobacco;
chemicals; paper, printing, and publishing; metals and minerals;
and textiles, clothing, footwear, and leather.

3 main manufacturing cities and their

specializations Birmingham, (automotive)
Glasgow (shipbuilding),
London (various),
Manchester (textiles),
Newcastle (shipbuilding and steel),
Nottingham (apparel, medicine),
Sheffield (steel and steel products)
Sunderland (shipbuilding and coal-mining)
Leeds (textiles and engineering)
Belfast (shipbuilding and textiles)
Cardiff (steel)

4 what is Channel-Tunnel
It’s an underwater railway tunnel that connects England with
France beneath the English Channel at the Strait of Dover.
5 what are London Docklands
London Docklands is the riverfront and former docks in London
VI. Give the following:
1 3 main cities that are financial centres
London, Leeds, Edinburgh
2 what is City of Landon It is a city, ceremonial county and local government district
that contains the ancient centre, and constitutes the primary
central business district (CBD) of London and one of the
leading financial centres of the world.
3 what is Canary Wharf
Canary Wharf is an area of East London, England, located
near the Isle of Dogs in the London Borough of Tower
Hamlets. Alongside the City of London, it constitutes one
of the main financial centres in the United Kingdom and the
world

4 the city with the UK's largest Leeds

e-business sector
5 the role of the Bank of England
6 the structure of the securities market
The Bank of England retains the sole right to issue
banknotes in England and Wales. The bank also intervenes
actively in foreign exchange markets and acts as the
government’s banker
The securities markets comprise the London Stock
Exchange, which deals in officially listed stocks and shares;
the Unlisted Securities Market, for smaller companies; and
the Third Market, for small unlisted companies

7 what are blue chips A blue chip is capital stock of a stock corporation with a
national reputation for quality, reliability, and the ability to
operate profitably in both good and bad times
8 what is invisible trade
VII. Give the following
1 position of the UK’s economy in the
world
2 what is the percentage GDP composition
by sectors in the UK
3 date of the major global financial crisis
at the end of the past decade
4 impact of the crisis on the UK and ways
of coping with it
5 regional disparities in the UK
6 characterize the economy of England
7 characterize the economy of Scotland
8 characterize the economy of Northern
International trade in services such as banking, insurance,
tourism, etc., rather than trade in physical goods
The economy of the United Kingdom is highly developed and
market-oriented. It is the fifth-largest national economy in the
world measured by nominal GDP, ninth-largest by PPP, and
twenty fifth-largest by GDP per capita, comprising 3.3% of
world GDP.
79,60% - services; 19,70% - industry; 0,60% - agriculture
2008
Only through many different attempts at stimulating the
economy while cutting down on public expenditures and raising
taxes was it possible for the UK to get back to a stabilized, albeit
weakened, economy. Brexit and the pandemic were the next
factors weakening the British economy, resulting in what we can
observe today: petrol crisis and shortage of employees
The southern part of England, and Greater London in particular,
is the biggest motor for the economy of the UK. Unsurprisingly,
this is also the priciest region to live in. The northern part of
England has overcome much of the negative reputation it held
after the decline of the local industry sector by diversifying its
economy considerably.
The GVA per capita of Scotland is slightly below UK average.
The economies of Northern Ireland and Wales are both similarly
small.
England is highly industrialised. Many important inventions,
such as the invention of the steam engine by James Watt were
made by Englishmen.
The development of industry has concentrated mainly in the
north. The service sector of the economy as a whole is now the
largest in England, with manufacturing and primary industries in
decline. The only major secondary industry that is growing is the
construction industry
In the late 20th century heavy industry declined, leading to a
shift in the economy of Scotland towards technology and the
service sector. The 1980s saw an economic boom in the Silicon
Glen corridor between Glasgow and Edinburgh, with many large
technology firms relocating to Scotland. Other important
industries in Scotland include textile production, chemicals,
distilling, agriculture, brewing and fishing
 Ireland Northern Ireland previously had a traditionally industrial
economy, most notably in shipbuilding, rope manufacture and
textiles, but most heavy industry has since been replaced by
services. Chief exports of Northern Ireland are ships, aircraft,
linen textiles, and also agricultural products and livestock as the
country is largely agricultural. There are small farms producing
pigs, cattle, milk and eggs. The principal crops are potatoes,
barley, and oats.

9 characterize the economy of Wales Wales’s GDP per capita and employment rates are far below
average for the United Kingdom. Wales has a diverse
manufacturing sector. Metal ore refining is a long established
industry in Wales

VIII. Give your native language equivalents of the words highligted in grey.