LONDON: British economic output is set to crash 14 percent this year owing to the coronavirus, the Bank of England said Thursday as it left its interest rate at 0.1 percent.
UK gross domestic product would rebound by 15 percent in 2021 however, the BoE said following a meeting that took place Wednesday.
Following the COVID-19 outbreak, the Bank of England slashed its main interest rate to a record-low 0.1 percent and decided to pump $244 billion (£200 billion) into the UK economy to get retail banks lending to businesses at risk of collapse.
Two members of the nine-strong Monetary Policy Committee, but not governor Andrew Bailey, voted at the latest meeting to increase the stimulus by a further $122 billion.
“Without further monetary stimulus, there could be greater scarring effects on the economy via both demand and supply channels,” Jonathan Haskel and Michael Saunders argued, according to minutes of the meeting.
For the entire year, the Bank of England forecast that GDP would plunge 14 percent despite picking up “materially in the latter part of 2020 and into 2021 after social distancing measures are relaxed.”
After a sharp rebound of 15 percent in 2021, output is forecast to grow by 3.0 percent in 2022, the BoE added.
British Prime Minister Boris Johnson was on Sunday set to outline plans on easing Britain’s nationwide lockdown, with initial restrictions expected to be lifted from next week.
The country’s official virus death toll has overtaken Italy’s to become the highest in Europe, with more than 32,000 fatalities related to COVID-19 — behind only the United States in the global tallies.
It comes amid reports that finance minister Rishi Sunak is looking into tapering the government’s furlough scheme that is paying UK workers stuck at home.
Latest government figures showed 6.3 million people were being paid up to 80 percent of their salaries, costing the taxpayer £8 billion.
IAG, the owner of British Airways and Spanish carrier Iberia, meanwhile said Thursday that it had fallen into a net loss of $1.8 billion during the first quarter, as the pandemic grounded planes worldwide.
UK economy to slump 14% this year on virus: Bank of England
https://arab.news/66su4
UK economy to slump 14% this year on virus: Bank of England
- UK gross domestic product would rebound by 15 percent in 2021 however
- ‘Without further monetary stimulus, there could be greater scarring effects on the economy via both demand and supply channels’
SIDF concludes participation in Momentum 2025
RIYADH: The Saudi Industrial Development Fund concluded its participation in the Development Finance Conference Momentum 2025 organized by the National Development Fund under the patronage of Crown Prince Mohammed bin Salman, prime minister and chairman of the NDF board.
The event was held from Dec. 9 to 11 at the King Abdulaziz International Conference Center in Riyadh.
The conference provided a platform to explore the future of development finance and its role in supporting sustainable growth. It brought together leading thinkers, investors, and decision-makers from around the world to discuss key challenges and opportunities, and to exchange experiences that enhance financing tools and maximize their developmental impact.
SIDF participation underscored its active role in supporting economic development through its financing advisory and knowledge-based programs as well as its diverse initiatives designed to meet the needs and aspirations of manufacturers and investors, aligning with the Kingdom's objectives and Vision 2030 targets.
In a panel discussion on the sidelines of the conference, Prince Sultan bin Khalid bin Faisal, CEO of SIDF, highlighted that the fund has, for more than 50 years, continued to develop its financing and advisory tools to empower national industries and enhance their global competitiveness.
He noted that SIDF has supported more than 4200 projects with total disbursements exceeding SR150 billion ($40 billion), attracting investments of nearly SR800 billion.
Prince Sultan added that the fund is currently focused on creating new financing channels in collaboration with government and private entities to provide sustainable funding for the private sector through mechanisms that attract capital and investors.
He said: “We recently launched the world’s largest supply chain financing program in collaboration with Saudi Aramco and the Saudi Electricity Co., benefiting thousands of suppliers and factories.”
SIDF participation culminated in signing a cooperation agreement with the Saudi Railway Company SAR to identify opportunities for industrial sector support and to assist investors in localizing goods and services to increase domestic content.
The Momentum 2025 conference reflects the Kingdom's leading role across various development sectors, highlighting the contributions of its development ecosystem in shaping a sustainable developmental future that delivers economic and social impact in line with Vision 2030 objectives.
The conference serves as a platform for collaboration that advances the implementation of development finance solutions, bringing together leaders from government entities, development finance institutions, investors and innovators from within the Kingdom and abroad.
It aims to strengthen partnerships that align capabilities across the system and translate developmental priorities into actionable initiatives, fostering inclusive and sustainable growth.
