DOWNING Street has insisted that the UK’s economy is strong despite the International Monetary Fund’s warning that Britain’s economy will go into reverse this year and will fare worse than all other advanced nations.
In its latest World Economic Outlook update, the IMF downgraded its UK gross domestic product (GDP) forecast once again, predicting a contraction of 0.6% against the 0.3% growth pencilled in last October.
The outlook for the year ahead puts the UK far behind its counterparts in the G7 group of advanced nations.
The UK is also expected to be the only country – across advanced and emerging economies – to suffer a year of declining GDP.
But Rishi Sunak’s official spokesman told reporters that the IMF itself “said that UK economic policy is now on the right track” following a rocky autumn under Liz Truss’ premiership.
The former prime minister caused the economy to spiral after she announced a raft of unfunded tax cuts, which eventually led to her resignation after less than two months in office.
Mr Sunak’s spokesman added that the UK outperformed many forecasts last year and was “predicted to grow faster than Germany and Japan over the coming years”.
But shadow chancellor Rachel Reeves said the government needs to do “so much more” to fulfil the potential of the UK economy.
Asking an urgent question on the IMF’s economic outlook update in the Commons, Ms Reeves said: “Britain has huge potential but 13 years of Tory failure has been a drag anchor on prosperity.
“Today’s IMF assessment holds a mirror up to the wasted opportunities and it is not a pretty sight.
“The UK is the only major economy forecast to shrink this year. Weaker growth compared to our competitors for both of the next two years.
“The world upgraded, Britain downgraded. Growth even worse than sanctions-hit Russia.”