In the News Teaching Activity –tracking the UK’s international trade patterns (Jan 2024)
The economists at UK in a Changing Europe have taken a closer look at what has been happening to the UK’s international trade patterns in 2023.
While growth picked up a little in November, inflation ticked up slightly to 4% and unemployment stayed at 4.2% at the end of last year, the UK’s trade patterns have also adjusted. According to the UK in a Changing Europe Report, the UK’s trade in goods has continued to fall back, while trade in services has increased compared to in 2019, the last year for trade before the Trade and Cooperation Agreement between the UK and EU was introduced; the UK’s trade deficit in goods and services widened to 1.9% of GDP. Meanwhile, the UK’s trade openness has also fallen back, implying the UK is less engaged in the global economy, though this is also true for other G7 countries. The share of the UK’s trade done with the EU has risen, perhaps unexpectedly given Brexit loosened the UK economy’s ties with the EU, though geographically the EU remains an important trading neighbour. Despite the UK signing new trade deals with countries further afield, the UK still does most of its trade with the EU.
1 What does ’pattern of trade’ refer to?
2 Read the short report by clicking on the pdf link, then answer the following:
- Between 2019 and 2023, what happened to the UK’s exports and imports of goods and services?
- What is ‘trade openness’?
- What % share of the UK’s trade is with the EU?
- Which countries were the UK’s top five trading partners for goods in Q3 2023?
3 Discuss why the UK continues to do the lion’s share of its international trade with the EU after Brexit.