UK growth ‘will outstrip eurozone’

BRITAIN’S economy is tipped to grow faster than any of its major European rivals this year.

The International Monetary Fund said output will rise by 1.4 per cent in 2020 and 1.5 per cent in 2021.

This is ahead of the euro area as a whole, which is expected to expand by 1.3 per cent in 2020 and 1.4 per cent in 2021.

UK growth will also be faster than in Germany, France and Italy over the next two years, according to the IMF.

In a report launched yesterday at the World Economic Forum’s annual summit in Davos, Switzerland, the IMF said: ‘In the United Kingdom, growth is expected to stabilise at 1.4 per cent in 2020 and firm up to 1.5 per cent in 2021.’

The report came as it emerged that more than 1,000 financial firms based in Europe, including banks and asset managers, plan to open offices here.

The companies have applied for permission to operate in Britain – and continue to serve UK clients – after we leave the European Union. Michael Johnson, a consultant at regulation experts Bovill, said: ‘ These figures clearly show that many firms see the UK as Europe’s premier financial services hub.’

The IMF said increased clarity on Brexit following Boris Johnson’s election victory was supporting financial markets.

It downgraded Germany’s economic growth forecasts to 1.1 per cent this year from 1.2 per cent. Germany is expected to grow by 1.4 per cent next year. The country’s key manufacturing sector has taken a battering amid global trade tensions, which have weighed on demand for goods such as cars and machinery.

France’s projections remained unchanged, at 1.3 per cent growth in 2020 and again in 2021.

The IMF said that its projections for the UK depended on an ‘orderly’ Brexit.