By Bob Duncan
Quarterly statistics from the IMF World Economic Outlook have downgraded the UK’s predicted GDP per capita for years ahead, but show our small independent neighbours outperforming the UK and racing further ahead.
A comparison of IMF predictions from April 2012 and October 2012 show that the updated predictions for GDP per capita in the UK for 2013 are $278.88 lower now than they were three months ago, and $443.10 lower for 2014.
The same figures also show that Ireland, Iceland and Norway have all maintained a higher GDP per capita than the UK throughout the duration of the economic downturn.
For 2013, the IMF predicts that UK GDP per capita will be just $37,384. This is 8.4% behind Iceland, 15.8% behind Ireland and a full 51.7% short of Norway, the only European nation, other than Scotland, to have substantial marine oil reserves in its waters.
Additionally the statistics show that this wealth gap is predicted to grow further in the years ahead, as Westminster’s austerity cuts continue to bite.
Ireland, in particular, is set to outstrip the UK economy by a further 2% per annum for several years to come, taking the Irish economy almost 22% adrift of UK GDP by 2016.
This latest blow to Westminster’s economic credibility comes as the IMF’s Christine Lagarde warned against countries rushing to cut spending, stating “it’s sometimes better to have a bit more time”.
Speaking to CNN on Thursday, Ms Lagarde said:
“What we have observed is that, when many countries at the same time adopt the same austerity measures, it creates a bigger and deeper impact on growth. And what we have advocated for some of those countries is, go a little bit more slowly.
“Second, don’t be focussed on a number – a nominal target – but make sure that you actually implement the measures that will take you to tat number at some stage.”
SNP MSP John Mason who is the deputy convener of the Finance Committee said:
“This is the latest damning evidence of just how poorly the Westminster government’s fixation with austerity is serving Scotland.
“What on earth will it take to make George Osborne accept that his pride must no longer come before doing what is needed to secure economic growth and recovery?
“As the predicted state of the UK economy in coming years is downgraded and Christine Lagarde warns of the dangers of the kind of approach George Osborne is taking, it is clear that something has to change.
“They also make an absolute mockery of the insults that have been thrown at neighbouring independent countries by senior figures in the anti-independence campaign who should really have known better.
“It demonstrates pretty clearly why people in glass houses shouldn’t throw stones. Instead of rushing to insult the economies of our near neighbours, the anti-independence parties would have been better advised focussing on the state of the UK’s economy.
“It is clearer than ever that we need the powers to make decisions over the future of our own economy in Scotland so that like our neighbours we can set an economic policy that meets Scotland’s needs and drives forward growth.”