Britain can overcome the consequences of its exit from the European Union and remain one of the 10 largest economies in the world if it remains open to talented foreigners, according to forecasts by consultancy PricewaterhouseCoopers.
Measured by purchasing power parity, the UK will only fall one place to 10th among its peers by 2050 – as long as it keeps its labor market open to skilled overseas workers and develops connections trade with fast-growing emerging markets, according to the analysis. PwC did not elaborate on how that outlook would be different without those policies.
Analysis of 32 of the world’s largest economies has suggested that Britain could experience the fastest growth of the Group of Seven over the next three decades, assuming it is home to a relatively large proportion of the population in working age. The authors said making forecasts over such a time horizon may seem “courageous”, but is useful for long-term planning in areas such as pensions and health care.
“Our relatively positive long-term growth projection for the UK is due to favorable demographics and a relatively flexible economy by European standards,” John Hawksworth, chief economist at PwC, said in a statement. “However, developing successful trade and investment ties with faster growing emerging economies will be key to achieving this, offsetting the likely weaker trade ties with the EU post-Brexit.”
PwC’s outlook shows that the global economy will double in size by 2042, driven by emerging markets and developing countries. By 2050, China will consolidate a lead it already holds on a purchasing power parity basis, with the United States slipping to third place, behind India.