Amid the euphoria gripping Great Britain during the eve of the London Olympics, it's economy is singing a different tune altogether. Figures from the second quarter confirms that the British recession is deepening. The economy shrank by 0.7%, with industrial output falling by 1.3%. Construction which represents less than 8% of the UK GDP fell by 3.2%, the biggest drop since the first quarter of 2009. After 3 quarters of negative growth, the situation appears gloomier by the day.
With this confirmed as the worst recession in 50 years, UK's George Osbourne is out of words as to what's happening. I laughed my lungs out when I head some reasons for this slump as extra public holidays during the Queen's Diamond Jubilee celebrations. Comeon guys, find something else to say. The austerity programme dominated by public spending cuts is responsible for this weak performance. This is a situation of a Policy Failure by the UK government. So this set of results aren't a shock to some of us.
The effects of the eurozone debt crisis will soon catch up with the UK if events in the Eurozone from bad to worse as projected. A recent study puts the UK at the top of the countries to be most affected if euro busts. Hence the UK is in for a bumpy ride sure. This rollercoaster isn't finished yet.
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