By Chathushka Perera
London (CWBN)_Unemployment in the UK rose from 3.9 (April) to 4.5% (October) as the country continues to grapple with morbidity of the Covid-19 pandemic even after the lockdowns were eased in August. The rise in unemployment can be regarded as a first sign to a worsening situation.
The latest reports indicate a 617,688 infections, 13,972 new cases and 42,875 reported deaths.
Statistics indicate a 10.2% drop in economic growth, ranging past the recession in 2009 from which the UK made a reasonable recovery of 1.3 to 2.61 over the course of 10 years. Although a growth rate of 6.3% is anticipated in 2021, much of this estimation is predicated upon presumptions on major factors that influence the economy. Covid-19 is of course a priority concern, however, it would be followed by the availability of skilled and able persons within the local workforce, the availability of employment opportunities, etc.
As a result of the lockdowns that came into place, many companies had to be dissolved and others went into temporary closure. Companies aren’t the only victims of the economy but also the small business trying to make a decent living.
Admittedly, the pandemic has posed multiple restrictions to the British economy, yet the largest factor that is least spoken of is the relationship to Brexit, spear-headed by the incumbent, conservative government.
The UK is officially no longer a part of the European Union (EU), however, negotiations are still on-going and are expected to conclude by the 1st of January 2021 and the two parties are maintaining ties with respect areas such as the regulation of medication, security cooperation, fishing and trade, until the deadline is reached.
If the UK is unable to foster a free trade agreement or at least a decent one with the EU, British exports are likely to face tariffs and border inspection, which would delay shipping. This would raise the prices of British goods in the EU market. Moreover, the service industries would also face similar limitations, particularly concerning the finance and banking sectors.
According to the parties have agreed upon, the UK Government is required to finalize terms of its new trade before the 15th of this month. The uncertainty behind this would also result in challenges to the Irish, being a member of the EU, would face when crossing over the border in the UK.
Thus far British Prime Minister, Boris Johnson, has provided a replacement to Former PM Theresa May’s proposal referred to as the ‘Irish Backstop’, which was no implemented. The new proposal, called the ‘NI Protocol’ is expected to ensure a flow of good between Ireland and the UK (Northern Ireland) with some border checks to ensure EU quality standards are met, and also taxed. However, in September, the British Government has informed of a need to clarify certain details of the arrangement before it could be implemented and admitted that it would breach international law.
