Arab Press

بالشعب و للشعب
Monday, Jan 05, 2026

Analysis: Boris Johnson's go-to economic boast obscures the painful truth

Analysis: Boris Johnson's go-to economic boast obscures the painful truth

Prime Minister Boris Johnson is fond of saying the United Kingdom has the fastest growing economy in the G7.

The prime minister can back up his claim with data published by Britain's Office for National Statistics (ONS) on Friday, which showed the United Kingdom had the fastest growing economy of the Group of Seven nations over last year as a whole.

UK gross domestic product — the broadest measure of economic activity — grew by 7.5% as activity bounced back with the lifting of coronavirus restrictions.

But those figures don't tell the whole story. The growth numbers are pumped up because the United Kingdom endured the deepest recession of any major developed economy in 2020 and its worst performance since 1921, providing a lower base for subsequent comparison.

Johnson's boast also doesn't reflect what happened in the final three months of last year. UK GDP expanded 1% in the fourth quarter, according to ONS data published Friday. That trailed the United States (1.7%) and Canada (1.6%), which are both in the G7.

Even those statistics obscure a larger truth: the United Kingdom is hurtling toward its worst cost of living crisis in 30 years, the Bank of England expects unemployment to rise next year and growth to be "subdued," taxes are going up and new post-Brexit import controls could slam foreign trade.

Short-term economic indicators have also been exceptionally volatile, reflecting the stop-start nature of business as coronavirus restrictions have come and gone. A better way to measure performance is to compare current economic output with levels before the pandemic arrived. Here, the United Kingdom is languishing near the middle of the G7 ranking.

In the fourth quarter of 2021, the UK economy was still 0.4% smaller than it was before the pandemic struck, according to the ONS. By the same measure, the US economy has expanded 3.1%, while France and Canada have grown by 0.9% and 0.2%, respectively.

The German and Italian economies have not yet achieved their pre-pandemic size, and comparable data for Japan is not yet available.

Johnson may be able to repeat his G7 claim without being slapped down by fact checkers. But it's less likely to land well with the British people, whose average disposable incomes after tax are forecast to decline by 2% this year.

UK inflation hit 5.4% in December, its highest rate since 1992, according to official statistics released last month. Wages advanced at an annual rate of just 3.8% in December, leaving households with less purchasing power.

A volunteer collects donated items from shelving racks at a food bank in Colchester, England, on January 20.


Brits are already feeling rising costs. Some 85% of people have noticed an increase in the costs of groceries, according to a January survey conducted by YouGov. Roughly 35% say their housing costs, including rent and mortgages, have risen. Nearly 75% have noticed higher fuel prices.

The cost of living crisis is about to get much worse.

The Bank of the England expects inflation to surge higher over the coming months and peak at 7.25% in April. In early February, the central bank hiked interest rates for a second time in three months in an effort to rein in rising prices, increasing pressure on homeowners with variable rate mortgages. More interest rate hikes are expected later this year.

"We are facing a squeeze on real incomes this year," central bank boss Andrew Bailey told reporters last week. "It is necessary for us to ... raise interest rates because if we don't do that, we think that the effects will be worse."

Energy bills will go even higher in April, when regulators increase a cap on how much consumers can be charged to heat and light their homes by 54%.

The change means that the typical consumer will see their energy bills increase by £693 ($939) to £1,971 ($2,670) per year. Some of that will be offset by a cut in local taxes, and a discount that will have to be repaid over 5 years.

The Joseph Rowntree Foundation said some families on low incomes would face annual bills as high as £2,326 ($3,152) from April, while the Resolution Foundation warned that the number of households in "fuel stress" — those spending more than 10% of the family budget on energy — would double to 5 million.

British Prime Minister Boris Johnson leaves 10 Downing Street on February 9.


Other government policies are adding to the burden on households.

Johnson is pushing ahead with plans to hike the National Insurance payroll tax in April in order to fund health and social care. The hike should help the elderly, but the tax is regressive, meaning higher earners pay a lower marginal rate than the poor.

And in early October, the government cut Universal Credit — a benefit claimed by those out-of-work or earning low incomes — back to its pre-pandemic level. More than 5.8 million people lost £20 ($28) a week, although the government later boosted the income of some people who work and receive the benefit.

One more big economic risk looms. The government has yet to implement fully the border checks that are needed as a result of Brexit, and there is considerable doubt over whether preparations are on track despite three previous delays.

The UK Parliament's influential Public Accounts Committee said this week that "there remains much to be done to introduce import controls." The trade group Logistics UK echoed that assessment, warning that delays at the border could cause a backup of trucks that would stretch for 29 miles.

Taken together, the combination of spiraling costs, taxes and risks to trade leave the prime minister with little reason to boast about the state of the UK economy.

Newsletter

Related Articles

Arab Press
0:00
0:00
Close
CNN’s Ranking of Israel’s Women’s Rights Sparks Debate After Misleading Global Index Comparison
Saudi Arabia’s Shifting Regional Alignment Raises Strategic Concerns in Jerusalem
OPEC+ Holds Oil Output Steady Amid Member Tensions and Market Oversupply
Iranian Protests Intensify as Another Revolutionary Guard Member Is Killed and Khamenei Blames the West
President Trump Says United States Will Administer Venezuela Until a Secure Leadership Transition
Delta Force Identified as Unit Behind U.S. Operation That Captured Venezuela’s President
Saudi-UAE Rift Adds Complexity to Middle East Diplomacy as Trump Signals Firm Leadership
OPEC+ to Keep Oil Output Policy Unchanged Despite Saudi-UAE Tensions Over Yemen
Saudi Arabia and UAE at Odds in Yemen Conflict as Southern Offensive Deepens Gulf Rift
Abu Dhabi ‘Capital of Capital’: How Abu Dhabi Rose as a Sovereign Wealth Power
Diamonds Are Powering a New Quantum Revolution
Trump Threatens Strikes Against Iran if Nuclear Programme Is Restarted
Why Saudi Arabia May Recalibrate Its US Spending Commitments Amid Rising China–America Rivalry
Riyadh Air’s First Boeing 787-9 Dreamliner Completes Initial Test Flight, Advancing Saudi Carrier’s Launch
Saudi Arabia’s 2025: A Pivotal Year of Global Engagement and Domestic Transformation
Saudi Arabia to Introduce Sugar-Content Based Tax on Sweetened Drinks from January 2026
Saudi Hotels Prepare for New Hospitality Roles as Alcohol Curbs Ease
Global Airports Forum Highlights Saudi Arabia’s Emergence as a Leading Aviation Powerhouse
Saudi Arabia Weighs Strategic Choice on Iran Amid Regional Turbulence
Saudi Arabia Condemns Sydney Bondi Beach Shooting and Expresses Solidarity with Australia
Washington Watches Beijing–Riyadh Rapprochement as Strategic Balance Shifts
Saudi Arabia’s Vision 2030 Drives Measurable Lift in Global Reputation and Influence
Alcohol Policies Vary Widely Across Muslim-Majority Countries, With Many Permitting Consumption Under Specific Rules
Saudi Arabia Clarifies No Formal Ban on Photography at Holy Mosques for Hajj 2026
Libya and Saudi Arabia Sign Strategic MoU to Boost Telecommunications Cooperation
Elon Musk’s xAI Announces Landmark 500-Megawatt AI Data Center in Saudi Arabia
Israel Moves to Safeguard Regional Stability as F-35 Sales Debate Intensifies
Cardi B to Make Historic Saudi Arabia Debut at Soundstorm 2025 Festival
U.S. Democratic Lawmakers Raise National Security and Influence Concerns Over Paramount’s Hostile Bid for Warner Bros. Discovery
Hackers Are Hiding Malware in Open-Source Tools and IDE Extensions
Traveling to USA? Homeland Security moving toward requiring foreign travelers to share social media history
Wall Street Analysts Clash With Riyadh Over Saudi Arabia’s Deficit Outlook
Trump and Saudi Crown Prince Cement $1 Trillion-Plus Deals in High-Profile White House Summit
Saudi Arabia Opens Alcohol Sales to Wealthy Non-Muslim Residents Under New Access Rules
U.S.–Saudi Rethink Deepens — Washington Moves Ahead Without Linking Riyadh to Israel Normalisation
Saudi Arabia and Israel Deprioritise Diplomacy: Normalisation No Longer a Middle-East Priority
As Trump Deepens Ties with Saudi Arabia, Push for Israel Normalization Takes a Back Seat
Thai Food Village Debuts at Saudi Feast Food Festival 2025 Under Thai Commerce Minister Suphajee’s Lead
Saudi Arabia Sharpens Its Strategic Vision as Economic Transformation Enters New Phase
Saudi Arabia Projects $44 Billion Budget Shortfall in 2026 as Economy Rebalances
OPEC+ Unveils New Capacity-Based System to Anchor Future Oil Output Levels
Hong Kong Residents Mourn Victims as 1,500 People Relocated After Devastating Tower Fire
Saudi Arabia’s SAMAI Initiative Surpasses One-Million-Citizen Milestone in National AI Upskilling Drive
Saudi Arabia’s Specialty Coffee Market Set to Surge as Demand Soars and New Exhibition Drops in December
Saudi Arabia Moves to Open Two New Alcohol Stores for Foreigners Under Vision 2030 Reform
Saudi Arabia’s AI Ambitions Gain Momentum — but Water, Talent and Infrastructure Pose Major Hurdles
Tensions Surface in Trump-MBS Talks as Saudi Pushes Back on Israel Normalisation
Saudi Arabia Signals Major Maritime Crack-Down on Houthi Routes in Red Sea
Italy and Saudi Arabia Seal Over 20 Strategic Deals at Business Forum in Riyadh
COP30 Ends Without Fossil Fuel Phase-Out as US, Saudi Arabia and Russia Align in Obstruction Role
×