The UK will become the world’s fifth biggest economy and the second largest in the European Union, behind Germany, by 2020, according to recent predictions.
The analysis also suggests that rigid labour laws and slow progress on structural reforms mean that France will tumble down the gross domestic product (GDP) rankings over the next 20 years.
The International Monetary Fund (IMF) has also warned that high levels of unemployment in France meant the country was at risk of a “stalled recovery”, even though it didn’t suffer from as deep a recession as the UK.
However, as one economist put it, while the UK has achieved ‘take off’ in terms of its economic recovery, the French economy has been rather left on the runway.
Meanwhile, growth in Germany is expected to slow in the coming years because of its aging working population, with research indicating that, with an average age of 44, the country has the second-oldest population in the world, behind Japan.
With a much younger workforce, however, the rapid rise in the Indian economy is expected to push it from being ranked the 10th largest economy in 2013 to the third largest, after the US and China, by 2030, pushing the UK back to number six by then.
According to the analysis, one of the expected megatrends in coming decades will be the gradual shift of economic power from the West to the East, with China, currently the world’s second largest economy, expected to close the gap with the US by 2030.
However, the report accompanying the analysis suggests that raising education standards and carrying out infrastructure projects would help to ensure that the UK economy stayed competitive amid increasing globalisation.