World News

Britain posts no growth in Q4 amid Brexit issues, election

By Don Jacobson   |   Feb. 11, 2020 at 9:32 AM
Analysts said the effects of Britain's pending departure from the EU affected the economy over the last three months of 2019. File Photo by Will Oliver/EPA EFE

Feb. 11 (UPI) -- Britain's economy showed no growth at all in the final quarter of 2019, the government said Tuesday in figures that reflected the turbulence of a national election and leaving from the European Union.

Figures from the Office of National Statistics showed flat economic growth over the last three months of the year after modest 0.5 percent growth in the third quarter.

Advertising
Advertising

The sluggish performance meant Britain's economy grew by 1.4 percent for the full year. Although slightly better than the 1.3 percent growth in 2018, 2019 marked the second consecutive year of anemic growth at levels below long-term trends.

Officials said sluggish manufacturing was a key factor in the lack of growth, particularly in the automotive industry. The sector shrunk by 1.1 percent in Q4 and by 1.5 percent for the year.

Retail trade during Christmas holiday was also disappointing. Data from the British Retail Consortium recorded a 0.9 percent decline in sales in November and December, and said it was the worst year on record and the first to show an overall retail decline.

Economists said British economic growth was "particularly volatile" throughout 2019 partly due to changes in activity related to the original planned Brexit dates. Prime Minister Boris Johnson had threatened to leave on Oct. 31 with or without an agreement, which affected production at auto factories.

There were signs of a rebound of activity in December following Johnson's resounding election victory, the figures showed. The economy grew by 0.3 percent during the month, driven by the services sector.

Suren Thiru, head of economics for the British Chambers of Commerce, said Q4's lackluster numbers showed the need for clarity on Britain's post-EU trading future and called on the government to take "swift and tangible steps" in its budget proposals to boost growth and productivity.