Country profile: United Kingdom of Great Britain and Northern Ireland

UNIT 5

THE ECONOMY OF THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND

LEARNING OBJECTIVES

After studying this unit, you should be able to:

· define the notions of main economic indicator of the economy of the United Kingdom of Great Britain and Northern Ireland;

· examine topics and subtopics related to the the economy of Great Britain;

· outline the main characteristics of each sector of the economy of Great Britain;

· outline the key features of the economy of England, the economy of Wales and Scotish economy;

· state the role of government in British economy;

· describe the importance of monetary policy of the British government;

· be aware of information about major technological industry of the economy of Great Britain;

· apply reading skills to comprehend, analyze and interpret texts related to the economy of Great Britain;

· give spontaneous and prepared monologs, dialogs and group interaction using topical vocabulary;

· summarize, annotate, render and translate texts related to the issues covered in the unit.

COUNTRY PROFILE: United Kingdom of Great Britain and Northern Ireland

GENERAL

Full name: The United Kingdom of Great Britain and Northern Ireland

Population: 64 716 000 (estimate 2015)

Capital: London

Largest city: Edinburgh, Cardiff, Belfast

Area: 242 954 km2

Major language: English

Major religion: Christianity

Life expectancy: 77 years (men), 81 years (women)

Currency: Pound sterling (GBP) (symbol: £), £=100 pence (singular: penny)

Trade organizations: European Union (EU), the Organization for Economic Co-operation and Development (OECD), World Trade Organization (WTO)

ECONOMY

GDP $2.945 trillion (Nominal; Sept 2015 USD), $2.548 trillion (PPP; Dec 2014)

GDP rank 5th (Nominal) / 10th (PPP)

GDP growth +0.5% Q3 2015 ONS +2.5% for year 2015 IMF

GDP per capita $46,244 (2015) $39,224 (PPP; April 2015)

GDP by sector: agriculture: 0.6%, construction: 6.4%, production: 14.6%

services: 78.4% (2014)

Inflation (CPI): 0.2% (December 2015)

Population below poverty line: 15% (2014)

Labour force: 31.39 million (November 2015) (Employment rate 74.0%, record high.)

Labour force by occupation: agriculture: 1.5%, industry: 18.8%, services: 79.7%

Unemployment: 5.1%, 1.68 million (October 2015)

Average gross salary: £2,480 /?3,373 / $3,814 monthly (2014) (8th highest)

Average net salary: £1,730 /?2,064 / $2,793 monthly (2014) (6th highest)

Main industries: aerospace, agriculture, automotive, business and professional services, chemicals, construction, consumer goods, defence equipment, education, electronics, energy, entertainment, financial services, food, healthcare, industrial equipment, information technology, media, pharmaceuticals and biotechnology, processed metals, real estate, retailing, scientific equipment, telecommunications, tourism, transportation and logistics

 

Exports $503 billion (9th; 2014)

Export goods: manufactured goods, chemicals, food, tobacco, automotive vehicles and components, computer programming, finance, entertainment, clothes, fuel oil and petroleum products, industrial supplies and materials, military arms and equipment, pharmaceuticals

 

Main export partners: Germany 10.8%, United States 10.4%, Netherlands 8.1%, Switzerland 7.2%, France 6.5%, Ireland 6.4%, Belgium 4.5% (2014)

Imports $802 billion (5th; 2014)

Import goods: manufactured goods, machinery, fuels, foodstuffs

Main import partners: Germany 14.9%, China 9%, Netherlands 7.8%, United States 6.5%, France 6.1%, Belgium 5.2% Italy 4.1% (2014)

Inward: $1.321 trillion (2012) (3rd)

Outward: $1.884 trillion (2013) (2nd)

Current account −£59.2 billion (2012)

Gross external debt $ 9,590,995,000,000(2014) (2nd)

Net international investment position £182 billion / 9.1% GDP (2012)

Public debt £1,500.00 billion (October 2015) (80.5% GDP)

Budget deficit £69 billion (2015–2016)

Revenues £672 billion (2015-2016) $1.029 trillion (2015)

Expenses £743 billion (2015–2016) $1.136 trillion (2015)

Economic aid 0.7%, $19.0 billion (2015) (donor)

Foreign reserves $95.54 billion (2012)

 

 

Task 1. Split into small groups. In your small group discuss the information you have read. Ask each other questions, in turn, about the general overview of the economy of Great Britain you were reading about, its GDP, labour force, population below poverty line, inflation and unemployment rate,main industries, exports and imports, external debt, budget. The purpose of these questions is to make sure that everybody in the group fully understands the information that has been read.

Task 2. Say what new information you have read about British economy.

Key terms

1. Study key terms and their definitions before reading Text A & B:

Economic indicator - економічний показник - a statistic used for judging the health of the economy such as GDP per head, rate of unemployment or the rate of inflation.

Gross Domestic Product (GDP) – внутрішній валовий продукт - the monetary value of all the finished goods and services produced within a country's borders in a specific time period.

Gross National Product (GNP) – національний валовий продукт - the most commonly used measurement of the wealth of a country. GNP is defined as the total value of all goods and services produced by firms owned by the country concerned.

National Income – національний дохід - the total income of the state in one year including both the wages of individuals and the profits of companies. National income is equal to gross national product.

National per capita income – національнийдохід на душу населення – the national income divided by population.

National Income Accounting – підрахування національного доходу –

A term used in economics to refer to the bookkeeping system that a national government uses to measure the level of the country's economic activity in a given time period. National income accounting records the level of activity in accounts such as total revenues earned by domestic corporations, wages paid to foreign and domestic workers, and the amount spent on sales and income taxes by corporations and individuals residing in the country.

Purchasing power parity (PPP) – паритет купівельної спроможності – an economic theory that estimates the amount of adjustment needed on the exchange rate between countries in order for the exchange to be equivalent to each currency's purchasing power.

Labor Market Statistics – статистика ринку праці - key data on the employment market in the UK, such as the net change in employment, unemployment rate, average weekly earnings, labor productivity, and vacancies.

Household Expenditures – витрати домогосподарства - household expenditure measures the contribution of households to economic growth and accounts for about 60% of the expenditure measure of the UK's GDP.

Inflation indicator – показник інфляції - which measure inflation at the consumer and producer levels.

Balance of Payment – платіжний баланс - the report includes detailed information on UK trade in goods and services, income, current and capital transfers, and transactions in UK.

Index of Production – показник виробництва - the ONS provides monthly estimates of the Index of Production for UK production industries, which account for close to 15% of GDP. The Index of Production is one of the earliest indicators of growth and measures output in manufacturing, mining, energy supply, and water supply and waste management industries.

GfK Consumer Confidence – (GfK - Growth from knowledge –market research) – показник довіри споживача - сonsumer confidence in the UK is obtained from the findings of the GfK Consumer Climate Europe survey, which is conducted by research firm GfK in all EU countries on behalf of the European Commission.The GfK Group is an international market research organization providing services in the three sectors Custom Research, Retail, Technology and Media.

Retail Sales – роздрібна продаж - the Office for National Statistics (ONS) releases a monthly report on retail sales activity across the UK, showing changes in sales activity in a given month compared to the previous month and to a year ago.

Construction Spending – витрати на будівництво - an economic indicator that measures the amount of spending towards new construction.

Bank – банк - A financial institution licensed as a receiver of deposits.

National bank – національний банк - is bank controlled by the national government of a country.

Central bank – центральний банк - central bank have a wide range of responsibilities, from overseeing monetary policy to implementing specific goals such as currency stability, low inflation and full employment. Central banks also generally issue currency, function as the bank of the government, regulate the credit system, oversee commercial banks, manage exchange reserves and act as a lender of last resort.

Commercial bank – комерційний банк - commercial banks are mainly concerned with managing withdrawals and deposits as well as supplying short-term loans to individuals and small businesses.

Investment bank – інвестиційний банк - focus on providing services such as underwriting and corporate reorganization to institutional clients.

Currency – валюта, грошова одиниця - the type of money in use in a country (the UK pound sterling)

Technology – технологія - new machines, equipment, ways on doing things that are based on modern knowledge about science and computers

The application of science to commerce and industry

Industry – промисловість – the sector of an economy that is concerned with manufacture

Service – послуги – intangible commodity of value

Service industry – сфера послуг - sector of the economy that supplies such as retailing, banking, education

Construction industry – сфера будівництва – the process of creating and building infrastructure or a facility

Trade – торгівля – the activity of selling goods and services in order to make a profit

Exports – товари, що експортуються - goods and services sold to foreign countries

Imports – товари, що імпортується - а goods or services brought into one country from another.

 

 

Text A

VOCABULARY PRECTICE

I. A) Find in the text English equivalents for the following word combinations.

B) Write your own sentences using them.

Найбільш впливова економіка; уникнути банкруцтва; скоротити податки; забезпечити фінансову підтримку; бути відповідальним за щось; внутрішній валовий продукт; головний економічний показник; врожай; національна політика; частка орної землі; на користь; покращити продуктивність; забезпечити виробників; гарантувати споживачам; за розумною ціною; товари вітчизняного виробництва; головна продукція сільського господарства; втратити можливість; загальний вилов; загальний попит.

II. A) Give Ukrainian equivalents for the following word combinations.

B) Make up and play out a dialogue with another student using the English word combinations.

The world's most globalised economies; to stimulate innovations, to encourage competition; to promote exports; world wide free trade; total output; the contribution to growth; to engage in; a high level of mechanization; exceeded demand; rural areas; to ensure stable markets; a fair standard of living; food supplies; to achieve aims; to levy on imports; to derive from; a high level of self-sufficiency; to be devoted to; fishing industry.

R E A D I N G

The Economy of England

The economy of England is the largest economy of the four countries of the United Kingdom. England is a highly industrialized country. It is an important producer of textiles and chemical products. Although automobiles, locomotives, and aircraft are among England's other important industrial products, a significant proportion of the country's income comes from the City of London. Manufacturing accounts for some 26% of the UK's GDP. England remains a key player in the aerospace, defence, pharmaceutical and chemical industries, and British companies continue to have a role in the sector through foreign investments.

The financial services sector has played an increasingly key part in the English economy and the City of London is one of the world's largest financial centre. The London Stock Exchange is based here. The British pound sterling is the official currency of England. Banks, insurance companies and the central bank of the United Kingdom, the Bank of England is located in London. The service sector of the economy has now the largest proportion of GDP and employs around 80% of the working population. Leeds is England's second largest financial centre, with over 30 national and international banks based in the city.

Manufacturing and primary industries are in decline in England. The only major industry that is growing - is the construction industry.

Agriculture is highly mechanized, and efficient by European standards, producing about 60% of food needs with only 2% of the labour force. It is subsidised by the European Union's Common Agricultural Policy. The main crops are wheat, potatoes, sugar beets. England is one of the world's leading fishing nations.

Tourism accounts for £96 billion of GDP (8.6% of the economy). It employs over 2 million people – around 4% of the working population of England. The largest centre for tourism is London, which attracts millions of international tourists every year.

Text B

VOCABULARY PRECTICE

I. A) Find in the text English equivalents for the following word combinations.

B) Write your own sentences using them.

Вироби з дерева та металу; головна економічна проблема; у вік сучасних технологій; нові медичні препарати/ліки; широкоекранні та цифрові телевізори; здійснити перехід на євро; безперервне економічне зростання; завершити перехід до сучасної економіки, яка ґрунтується на сфері послуг; важливе джерело зайнятості; грошова політика; інтенсивно розвиватися; вирішити не приймати євро; не відповідати вимогам інтенсивності руху; забезпечувати надійним громадським транспортом

II. A) Give Ukrainian equivalents for the following word combinations.

B) Make up and play out a dialogue with another student using the English word combinations.

A broad category of output; it is necessary to emphasize; the increasing use of intensive methods; the main electronic consumer goods produced; growth has been most notable; services have experienced the fastest growth; foreign exchange and gold reserves; to established the euro as its unit of currency; world’s foremost travel destinations; to assist visitors; from shipping to rail systems and aviation; licensed civil airfields; an impressive number of commuters; a larger metropolitan area

READING

ACTIVITY 1

L I S T E N I N G

Monetary Policy

You are going to listen to Kate Barker, an economist and a member of the Bank of England’s Monetary Policy Committee, talking about monetary policy. Before you listen, try to answer the questions below.

1. What is the aim of monetary policy?

2. What tools does a central bank use to control supply and demand for money?

3. What tends to happen when interest rates rise?

4. What tends to happen when interest rates fall?

5. What do commercial banks do after the central bank changes the base rate at which it lends them money?

ACTIVITY 2

Read the following information and answer “Why doesn't England use the euro?”

The euro is the official currency for most of the member states of the European Union. The geographic and economic region that uses the euro is known as the "Eurozone." Proponents of the euro believe that adopting a single currency over the European economic system reduces the exchange rate risk to businesses, investors and financial institutions. It is also argued that a currency with the backing of the Eurozone economy is better able to compete with the American dollar and other major world currencies. Detractors of the euro monetary system say that too much power is concentrated with the European Central Bank, which sets monetary policy for the euro. This reduces the ability of individual countries to react to local economic conditions.

The United Kingdom is the most notable member of the European Union that has elected not to use the euro. Rather, the United Kingdom uses the pound sterling as its national currency. When the euro was first proposed as a single currency system for the European Union, the Prime Minister of the United Kingdom, Tony Blair, declared that there were "five economic tests" that must be met for his country to accept the euro. The tests are as follows:

1. Business cycles and economic structures must be compatible enough that the United Kingdom could live with Eurozone interest rates.

2. The system must have sufficient flexibility to deal with both local and aggregate economic problems.

3. Adopting the euro must create conditions conducive to firms and individuals investing in the United Kingdom.

4. The euro would enable the nation's financial services industry to remain in a competitive position internationally.

5. Adopting the euro must promote higher growth, stability and a long-term increase in jobs.

Many people in Great Britain believe that the five economic tests, as constructed, set standards so difficult to satisfy that a movement to the euro from the pound sterling can never be justified.

Other Reasons for Not Adopting the Euro

The British government has not wanted to abdicate control of its own interest rate policy, which would occur under a euro system. The system would also remove the current level of comfort with the pound sterling exchange rate; for instance, a British firm or investor who is used to exchanging pounds to dollars or vice versa would be forced to adjust to a euro exchange rate. Additionally, the United Kingdom would be forced to meet the "euro convergence criteria" before adopting the euro, which includes maintaining a debt-to-GDP ratio that limits British fiscal policy. As of 2014, the United Kingdom only met 20% of convergence criteria.

to abdicate – відректися

convergence – конвергенція

ACTIVITY 3

Aerospace industry

The UK has the second largest aerospace industry in the world after the US, with over 3,000 companies employing about 230,000 people. It’s expected to grow at a rate of 6.8% over the next few years meaning opportunities for overseas investment.

The UK’s civil aerospace sector conducts a lot of research and development (R&D) and investment can help increase productivity and create new jobs for the future.

1. Aerospace companies

More than 3,000 aerospace companies operate in the UK, including BAE Systems, GKN and Rolls-Royce. Other international companies with operations in the UK include: Airbus, Augusta Westland, Finmeccanica, Thales, Boeing, Bombardier.

The UK aerospace sector has the largest number of small and medium sized enterprise (SME) companies in Europe, with 55% of total civil aerospace sales in 2010.

2. Design and manufacturing

The UK has strengths in areas such as: design and manufacture of large aircraft wings, production of aircraft engines, design and manufacture of helicopters, building landing gear systems, creating advanced aircraft systems.

The UK is one of few countries with the resources to design and manufacture advanced helicopters. The global demand for new commercial helicopters is expected to be more than 40,000 units every year, worth $165 billion.

3. Supply chain

Small specialist companies working in the supply chain are important for the aerospace industry. Many supply components and parts to companies in the UK and also overseas through exporting.

4. Producing and maintaining aircraft engines

Rolls-Royce is the world’s second largest aircraft engine manufacturer. The amount of engines produced by the company creates opportunities for manufacturers of components operating in the UK. This also helps to continue demand for servicing and maintaining aircraft engines.

The UK has a large maintenance, repair and overhaul (MRO) sector, servicing the military and civil aircraft that fly from the UK every year. Overall, the UK has a 17% share of the $45 billion global MRO industry.

5. Research and development (R&D)

The aerospace sector spent £1.4 billion on R&D in 2012 which represents 12% of total R&D spend across the manufacturing industry.

UK companies are leading innovation in engine maintenance. At centres like Nottingham University’s Institute for Aerospace Technology, academic researchers are focusing on new power systems and improving the way faults are diagnosed. Companies are also funding the development and testing of new technologies.

6. Employment skills

The UK has a highly skilled workforce which helps UK based companies respond to changes within the industry. Students are able to study a number of different engineering related courses at universities which provide the knowledge, skills and training for working in the aerospace industry.

7. Defense aerospace

Defense is a major part of the UK’s aerospace sector. In addition to BAE Systems, a number of other international companies work on defense projects in the UK.

8. Government is working with industry

8.1 UK government

The government’s joint aerospace industrial strategy done with business was published in March 2013. The strategy specifies what needs to be done for the UK to remain a leader of manufacturing technologies that will help development of new aircraft and technologies.

8.2 UK Aerospace, Defense, Security and Space industries (ADS)

The ADS is the main organization promoting the UK aerospace, defense, security and space industries. The aerospace members committee of ADS represents the UK aerospace industry’s SMEs working in the supply of components, systems and services within the aerospace supply chain. The ADS has helped bring the industry together to work closely with government.

8.3 The Aerospace Growth Partnership (AGP)

The AGP is a partnership between government and industry to work together on addressing the challenges for the future of the aerospace sector.

9. Locations

There are different locations across the UK known as Enterprise Zones that offer investors incentives to locate themselves there including: reduced taxes, simpler planning rules, financial benefits.

Many Enterprise Zones have employment clusters, where businesses from the same sector are co-located within the zones.

UKTI can help overseas companies and investors identify opportunities in the UK’s aerospace sector.

ACTIVITY 4

ACTIVITY 5

Scan the next article for the answer to the following questions:

1. What areas are automotive businesses leaders?

2. What distinct parts does this sector have?

3. How many jobs does automotive manufacturing provide?

4. What is the contribution of automotive industry to the UK economy?

5. How many billions is the industry investing in new plant and technology annually?

6. Why are the world’s major automotive companies attracted to the UK?

7. Why hasn’t competitors of Britain’s automotive industry now?

8. How many firms does this sector include?

9. What producers does the list of the world’s top 20 suppliers contain?

10. What components does automotive industry produce?

11. Why is UK also a centre for design engineering?

Automotive industry

The automotive unit uses its unique knowledge of the sector, materials, companies, technologies and the regulatory framework to ensure the UK is best placed to benefit from the challenges of globalisation and help the UK Automotive Industry succeed.

Automotive businesses are leaders in many areas of manufacturing, purchasing, product development and logistics. Major inward investors have brought with them world best practice and the skills and knowledge of the industry provide a key source for improvement across the UK manufacturing sector as a whole.

The sector has two distinct parts: the manufacture of vehicles and components; and the motor trade (including retail, distribution and aftermarket services).

In the case of manufacturing, Britain leads Europe as the most diverse and productive vehicle manufacturing location and as a global centre of excellence for engine development and production.

More than 40 companies manufacture vehicles in the UK – ranging from global volume car makers, van, truck and bus builders, to special vocation players. The industry is supported by a dynamic supply chain including many of the world’s major component manufacturers, technology providers, design and engineering consultancies; and it benefits from a world-renowned knowledge base.

No other European country has anything like this range and number of automotive players. The industry in the UK is characterised by significant foreign direct investment and high exports, equivalent to 13% of the UK’s exports of goods. Overall, automotive manufacturing provides 180,000 jobs and contributes some £10.2 billion value-added to the UK economy (6.4% of the total for the whole UK manufacturing sector). The companies based in the UK operate in Europe’s third biggest automotive market with UK customers in 2008 accounting for the purchase of more than 2.1 million new cars – equivalent to 14% of European vehicle registrations.

Moreover, the UK offers a highly sophisticated retail and service maintenance sector, which last year generated some £24 billion value added to the UK economy. It comprises some 67,000 businesses employing 552,000 people.

The automotive industry is at the forefront of process improvement – setting standards for other sectors, such as aerospace – and is characterised by economies of scale and low unit costs, despite the increasing complexity of its products. In 2015, 1.45 million cars and 203,000 commercial vehicles were produced in the UK. Of these, more than 78% of the cars and 62% of the commercial vehicles were exported.

The UK accounts for some 2.4% of worldwide vehicle output and 8.7% of European assembly, ranking it fourth in Europe and twelfth globally.

There are around 2,600 component manufacturers in the UK, ranging from the global players to small and medium-sized businesses. Together they contribute £4.7 billion added value and employ around 106,000 people. The components sector exports over £5 billion worth of goods annually, 75% destined for Europe. The UK is also an increasing force in powertrain design and production (the components making up the power transmission system of a motor vehicle from engine to final drive), with a particular strength in engines.

There is a long-established, independent, design engineering sector offering the full spectrum of services from concept design through to limited-series vehicle production. The sector is recognised internationally for its flexibility and responsiveness and for the innovative qualities of its engineers. It continues to evolve and the last five years have witnessed a succession of acquisitions, closures and re-emergences in response to the changing demands of its global market.

The UK is also strongly influential in vehicle styling, with many British designers and graduates from British institutions directly employed by vehicle manufacturers around the globe. As a direct result of this expertise, Nissan recently moved its design studio from Germany to London.

This strong combination of tradition and changes the automotive industry in the UK in excellent shape to face the continuous pressures for change in the 21st Century. The principal challenge is for the UK’s automotive manufacturing industry to support its technology, product and business performance to deliver customer value in a global industry subject to relentless cost-cutting pressures.

Additionally, industry analysts expect South East Asian manufacturers to dramatically increase their global market share. But with the UK’s close focus on efficiency, productivity, innovation and value-added manufacturing and its cross-section of international manufacturers, the industry is well placed to face these challenges with confidence.

The UK automotive manufacturing industry is truly dynamic, accounting for 0.8% of GDP. The world’s major automotive companies are attracted to the UK by an unrivalled combination of engineering excellence, a skilled and flexible workforce and a government that strives to create an excellent business environment for companies to prosper – whether domestic or with foreign parents.

One of the great strengths of the UK automotive industry is a deep understanding of globalisation and an ability to continuously evolve and create new opportunities in the face of change. Over the last 20 years there has been a revolution in the way vehicles are manufactured, with a streamlining of production processes, elimination of waste and focus on quality, cost and delivery. It can be said that the automotive industry in the UK now rivals that in any country in the world for its combined efficiency, quality and unit cost.

Overall, the sector includes some 3,300 firms. The majority of vehicle manufacturers and first-tier component suppliers are overseas owned, all treated equally by the Government. Seven of these are volume car manufacturers with a number of truck, van and bus companies, supported by 19 of the world’s top 20 suppliers. The list includes, for example, BMW (MINI), Ford light commercial vehicles and engines, GM (Vauxhall), Honda, Jaguar and Land Rover, Nissan and Toyota. Suppliers include Aisin, Bosch, Calsonic, Dana, Delphi, Denso, GKN, Johnson Matthey, Pilkington, Siemens VDO and many more.

In addition, there are a number of manufacturers producing high value and luxury vehicles serving niche markets, including Aston Martin, BMW (Rolls-Royce), Caterham, Connaught, Gibbs, McLaren and Mercedes-Benz (Mercedes-McLaren SLR), Morgan, Proton (Lotus), TVR, and VW (Bentley).

There are also major companies of the construction equipment, heavy plant and off-road sectors such as Caterpillar, CNH, JCB, Komatsu and Terex, all manufacturing in the UK.

The UK has three sites producing light and medium vans. IBC Vehicles in Luton builds Vauxhall/Opel, Renault and Nissan badged vehicles, the Ford plant in Southampton manufactures Transit vans and LDV in Birmingham produces the Maxus van range.

The UK’s sole volume truck builder is Leyland Trucks, a wholly owned subsidiary of the PACCAR group of the US. The Leyland facility is one of Europe’s largest and most advanced plants and has won many industry awards for its efficient performance. It builds trucks under the DAF brand. From 2008 all DAF trucks on UK roads will have been built at Leyland.

Overall the industry is currently investing over £1 billion annually in new plant and technology, equivalent to 13% of gross value-added.

The UK is also a centre for design engineering (проектування) where around 7,500 people are employed, generating a turnover of some £650 million, with around 65% exported. The UK is home to the dedicated facilities of vehicle manufacturers, such as those at Ford’s engineering centres at Dunton, Gaydon and Whitley, and Nissan’s R&D centre at Cranfield. In addition renowned names such as Lotus Engineering, MAHLE, MEL, Millbrook, MIRA, Perkins, Pi Technology, Prodrive, Ricardo, RLE, Roush, TRW Conekt, TWI and Zytek are also active in the UK. Many of these have other overseas operations, located everywhere from mainland Europe to the US, Japan and China.

 

ACTIVITY 6

Before you read the following article skim through it quickly and underline two sentences that convey the main ideas.

ACTIVITY 7

Scan the following article to define the terms below:

- Unemployment

- employment

- wage

- interest rate

ACTIVITY 8

S P E A K I N G

1. Choose economic indicators from the following terms.

Gross Domestic Product, employment, labor market statistics, inflation, labour force, balance of payments, output, household expenditures, interest rate, retail sales, construction sector, Gross National Product,National bank, index of production, trade, GfK consumer confidence, export, Halifax house price index, import, service sector, public sector expenditure and debt

 

2. Split into groups of four. From your own point of view try to analyze the economy of Great Britain using economic indicators.

3. Discuss these questions:

1. What is the British main economic indicator you have defined above? Explain your choice.

2. What is the rate of inflation in Great Britain nowdays?

3. What place does Great Britain rank in world economy?

4. What is the level of living standard in Great Britain? Reinforce facts.

5. What sectors can the British economy be divided into? Try to guess and explain your choice.

 

Assignments for discussion.

Comment on the following quotations.

1. “For a quarter-century British governments had tried and failed to combine economic growth, increased social service provision and a high level of employment. The second depended ultimately on the first, but when difficulty arose, the first had always been sacrificed to the other two. The United Kingdom was, after all, a democracy whose votes, greedy and gullible, had to be placated.” ― J.M. Roberts, The New Penguin History of The World

2. “The good news is that, according to the Obama administration, the rich will pay for everything. The bad news is that, according to the Obama administration, you're rich.” ― P. J. O'Rourke

 

Ex. Role-play

Student A	Student B
You are the British Minister of Economy. Answer the questions of a journalist interviewing you. Use both the information from the Unit and from your preceding in-class discussion in your answers.	You are a journalist from “Financial Times” is read mainly by professionals and business people as it contains a comprehensive coverage of industry, commerce and public affairs. Interview the British Minister of Economy. Use both the information from the Unit and from your preceding in-class discussion to form questions about different aspects of the British economy.

 

W R I T I N G

SELF-ASSESSMENT QUESTIONS

UNIT 5

THE ECONOMY OF THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND

LEARNING OBJECTIVES

After studying this unit, you should be able to:

· define the notions of main economic indicator of the economy of the United Kingdom of Great Britain and Northern Ireland;

· examine topics and subtopics related to the the economy of Great Britain;

· outline the main characteristics of each sector of the economy of Great Britain;

· outline the key features of the economy of England, the economy of Wales and Scotish economy;

· state the role of government in British economy;

· describe the importance of monetary policy of the British government;

· be aware of information about major technological industry of the economy of Great Britain;

· apply reading skills to comprehend, analyze and interpret texts related to the economy of Great Britain;

· give spontaneous and prepared monologs, dialogs and group interaction using topical vocabulary;

· summarize, annotate, render and translate texts related to the issues covered in the unit.

COUNTRY PROFILE: United Kingdom of Great Britain and Northern Ireland

GENERAL