COUNTRYAAH, the country's industry has long been based on the
traditional (and partially obsolete) heavy industry such as
coal mining, shipyards, steel and engineering. Over the past
30 years, a structural change has taken place to such an
extent that the industry now accounts for only 20 per cent
of GDP, while the service industries have increased sharply.
Foremost, the financial and oil sectors have grown rapidly.
Oil and natural gas were discovered in the North Sea in the
late 1960s, and extraction began shortly after.
The London Stock Exchange is one of the largest in the
world, and the capital houses a very large number of foreign
banks. More than 40 per cent of Japanese and US direct
investment in the EU is now in the UK. The economic policies
that have been in place since 1979 have led to major changes
in the form of increased market adjustment, tax reductions,
privatizations and inflation control. The first years
included high unemployment and inflation, but since 1982
inflation has been low and production has increased.
During the late 1990s and early 1990s, the British
economy grew; In 1997–2007, GDP increased by an average of 3
percent. In 2008, the country was hit hard by the global
financial crisis. Falling house prices, high consumer debt
and the slowdown in the global economy caused the country to
experience a recession at the end of 2008. This led the
government to implement a number of measures to stimulate
the economy. The financial years were followed by financial
tightening. In 2013, the economy began to recover, a trend
that continued. In 2014, GDP was at the same level as before
the 2008 economic crisis.
||Change in GDP (%)
||Government debt share of GDP (%)
||Budget deficit's share of GDP (%)
||Unemployment of total workforce (%)
Source: IMF, OECD and World Bank
As a result of early industrialization and urbanization,
the agricultural sector in Britain was small as early as the
late 1940s. In 2017, agriculture accounted for just under 1
per cent of GDP, and the proportion of employed in the
sector was just over 2 per cent. However, production has
constantly increased, and agriculture now forms a modern and
efficient part of the British economy. The rationalization
has meant that the average farm size has grown to 70 ha (the
highest in the EU). The entry into the EC of 1973 with its
common agricultural policy has meant guaranteed prices for
producers and increased self-sufficiency; the need for
example. oats, wheat, rye, potatoes and meat are now almost
exclusively covered by domestic production. However, exports
of agricultural products are relatively small, just under 7
per cent of total exports. However, EU policy has meant high
prices. In addition, most of the support has gone to the
large farms in the south at the expense of family farming
around the country. Following some reforms in agricultural
policy, prices are now at a lower level and earlier
overproduction has decreased.
About three quarters of the country's land is used for
agriculture. The cultivated area decreases annually in favor
of pastures. The most important crops are wheat, barley,
sugar beet, potatoes, oats and more recently rapeseed.
Animal husbandry is dominated by cattle, sheep, pigs and
poultry. Gardening is common around the cities in the
southeast and in the Midlands, and early fruits and
vegetables are cultivated along the south coast. The most
intensive and large-scale agriculture is conducted in East
Anglia, north of London. Unlike large parts of Europe,
radical shifts were carried out during the 18th and 19th
centuries in the United Kingdom, as in Sweden and Denmark.
This greatly characterizes the country's (especially
England's) cultural landscape, which is dominated by
individual farms and large fields surrounded by hedges.
About 3 million ha (one tenth of the country's area) is
used for productive forestry. The state-owned Forestry
Commission is responsible for about 40 percent of this.
The British forest area has doubled since 1919. The
productive forest increased by about 220,000 ha during the
years 1985–94, mainly on privately owned land. The main
reason was the tax relief that landowners have received, but
after extensive criticism that said that financial
considerations have been taken over environmental
considerations too much, most benefits have now been
removed. Most new plantings are in the form of conifers in
highland areas. The country's production covers just over 10
percent of the need.
With its approximately 6,000 boats, the UK has the EU's
second largest fishing fleet after Spain. The United Kingdom
is one of Europe's leading fishing nations but has
experienced a sharp decline. The total catch has decreased
by 12 percent during the period 2001-13. The decline has
several causes: firstly, the country has lost the right to
the more remote deep-sea fishing in, for example, Iceland,
and the EU has been forced to open its own waters to other
fishermen, and the EU has introduced restrictive fishing
quotas which must not be exceeded. The downturn has affected
mainly the large and modern fleet and thus also the larger
ports. The most important fish species caught are cod,
haddock, mackerel, whiting, herring and plaice.
The UK has more energy resources than any other EU
country. Coal, which was once a prerequisite for the British
business community, has declined significantly in
importance. At the time of the First World War, 300 million
tonnes were broken by one million miners. In 1995,
extraction had decreased to about 90 million tonnes and the
number of employed to below 50,000. In 2013, 13 million
tonnes were broken and the number of employed was just over
6,000. In 2011, there were almost 40 mines (1950 there were
over 900), concentrated to the Midlands, Yorkshire and the
north-east England. In the formerly important mining
districts of southern Wales and Scotland, only a few remain.
This powerful rationalization, which is expected to
continue, has led to major social problems but at the same
time has made the country the most efficient coal industry
in Europe and the only one that has managed to survive
without subsidy. Other mining produces aluminumand, in small
quantities, lead. Bulk processing or production is made of
iron, steel, cement, potassium carbonate (potash; see
Potassium: Compounds), sand, natural gravel and stone.
The oil and gas industry has been the UK's largest
industrial sector for the past four decades and in 2012
contributed 70 per cent to the country's energy needs. The
production of North Sea oil began in 1975, and in 2012 the
country was 60 per cent self-sufficient for crude oil. The
oil is taken in via pipelines to ports in the Shetland and
Orkney Islands, in Scotland and to Teesport outside
Middlesbrough. The North Sea gas began to be mined as early
as 1967, and today there is a pipeline network across the
country that has replaced the natural gas now with the
coal-dependent city gas. Oil and gas production is expected
to gradually decline as a result of declining reservoirs and
an increase in renewable energy sources.. The latter
contributed to only 5 per cent of the energy demand in 2012
but is expected to be 15 per cent by 2020.
The UK's energy needs are covered by almost 90 per cent
of fossil fuels and the remainder mainly by nuclear energy.
More than half of the country's energy supply is produced
within the country while the rest, mainly crude oil and
natural gas, is imported. Almost half of its own production
consists of crude oil and one third of natural gas. Of the
total energy consumption, three quarters are based on
petroleum products and one fifth on electricity. Consumers
account for one third of the transport sector and the
housing sector, while the transport sector accounts for the
majority of the remainder. Just over a quarter of the energy
supply is exported, and almost exclusively in the form of
oil products; a very small part of the electricity supply is
regulated by electric cables to Ireland and France.
Energy consumption in the United Kingdom has increased on
average by just over 1 per cent per year since 1950;
however, the increase has been far from steady and since
2005 an annual decrease has instead taken place. During the
1950s, coal accounted for 90 percent of the total energy
demand, but until the oil crisis in 1973, the oil demand
increased to almost 50 percent. In 2012, coal, mainly
imported, accounted for 20 per cent of the energy supply,
but only 8 per cent of the energy produced in the country.
The electricity is mainly produced from thermal power plants
fired with coal or gas or produced in nuclear power plants.
Of the energy supply, nuclear 2012 accounted for 10 per cent
and biofuels for 4 per cent, while water energy (mainly in
Scotland), geothermal energy and solar energy made only a
The UK's energy production is expected to be carbon
neutral by 2050 and carbon neutral energy types (nuclear and
renewable fuels) are expected to contribute 40 per cent of
electricity generation in 2020. The increase is due to a
planned expansion of installations for the production of
electricity from renewable fuels. The expansion of wave
power is at an initial stage.
The relative importance of industry for the British
economy has decreased throughout the post-war period, and
especially after 1960. Between 1960 and 2017, industry's
share of GDP fell from 36 to 20 percent; the proportion of
employed fell even more and was down 15 per cent in 2015.
The great unemployment that hit the country during the 1980s
was largely due to the rationalizations of the industry.
Since the late 1980s, noticeable productivity growth has
taken place, and today's British industry is modern and
competitive in many industries. The most important
industries are engineering, electrical and electronic, food,
chemical and paper, as well as printing and publishing.
Machines for the textile and mining industries, tractors,
bicycles, aircraft, cars and ships are among the products of
the engineering industry. The two latter have been hit hard
by the recession and structural changes during the 2000s.
The domestic car industry also includes foreign (mainly
Japanese and German) brands. The shipyards now primarily
build warships, but increasingly face international
competition. The space industry is also important.
Manufacturing of computer equipment employs many in the
electronics industry; several of the companies belong to
foreign companies. Important branches of the food industry
are dairies, bakeries, breweries and the manufacture of
alcoholic beverages; of greatest importance here is the
Scotch whiskey production. The chemical industry
manufactures pharmaceuticals, soaps and detergents, paints
and synthetic fibers.
Large parts of the British manufacturing industry now
have foreign owners, while many of the British companies
have moved manufacturing to low-wage countries.
The country's foreign trade accounts for 1/4 of GDP.
Until 1950, a very large part of Britain's foreign trade
took place with the countries that today constitute the
Commonwealth. Even before entry into the EC in 1973, trade
had shifted to Western Europe and the United States. In the
1950s, Western Europe accounted for 29 percent of exports;
now the figure is about 60 percent, of which other EU
countries account for the majority. The biggest change in
recent years is the increased export of oil. Other important
export goods are machinery, transport and chemical products.
40 years ago, only 5 per cent of the finished goods were
imported, today it is close to 50 per cent. Important import
goods are machinery, transport equipment, computer equipment
and chemical products, ie. largely goods within the same
groups as exports. The three most important export and
import countries are Germany, the US and China, which
together account for 35 percent of all trade.
The UK is visited annually by between 25 and 30 million
foreign tourists. Two thirds come from Europe (mainly France
and Germany), while North America contributes just under one
fifth. More than every other tourist visits London, among
other destinations include the Scottish Highlands, the
seaside resorts along the English south coast and Devon and
Cornwall in south west England. The major national parks are
appreciated for their natural beauty; the best known are the
Lake District in the north of England, the mountain regions
of Snowdonia in the north of Wales and the Dartmoor and
Exmoor lakes in south-west England.
The largest individual attractions are the British
Museum, the National Gallery, the Natural History Museum and
the Tate Modern, all in London.
Other tourist destinations are the cathedrals in York and
Canterbury as well as Westminster Abbey in London. Also
mentioned are the Tower, Madame Tussaud's wax cabinet and
the Paris Eye wheel.