The UK Government has downgraded its GDP growth forecast for 2020 to 1.1 per cent from 1.4 per cent due to Brexit and the outbreak of the coronavirus disease (COVID-19).
The Chancellor of the Exchequer, Rishi Sunak, made the statement on Wednesday while delivering a speech on budget in the House of Commons adding that the coronavirus impact was not yet fully accounted in the forecast.
“The GDP forecast without fully accounting for the impact of coronavirus would have led to growth of 1.1 per cent in 2020, 1.8 per cent in 2021, then 1.5 per cent, 1.3 per cent and 1.4 per cent in the following years.
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Sunak cited data from the UK Office for Budget Responsibility (OBR), which presented an official forecast of economic indicators.
The chancellor stressed that the measures to support the economy that the government intended to adopt would boost the country’s economy.
“The OBR have said that, as a direct result of the plans that I am announcing, growth over the next two years will be half a percentage points higher than it otherwise would have been.’’
In March 2019, the OBR expected the UK economy to grow by 1.4 per cent in 2020 and by 1.6 per cent in 2021.