The UK economy will struggle to turn itself around in five years, with some regions particularly struggling

　　The United Kingdom (GBR) faces five years of slow growth because of continued fiscal policy mistakes, an influential think tank has said.

　　Gross domestic product is unlikely to return to pre-COVID-19 levels until 2024, according to the London-based National Institute of Economic and Social Research (NIESR). The forecasts echo the latest pessimism from the Bank of England (BoE), which said last week that GDP would remain below pre-pandemic levels "over the medium term."

　　NIESR said weakness in some regions would be particularly pronounced amid weak aggregate growth. Real wages in London are expected to rise by 7 per cent in the five years from the end of 2019, but inflation-adjusted wages in the West Midlands, home to Birmingham, the UK's third largest city, will fall by 5 per cent.

　　"The triple supply shocks of Brexit, the COVID-19 and the Russia-Ukraine War, combined with the monetary tightening necessary to reduce inflation, have had a severe adverse impact on the UK economy," said Stephen Millard, deputy director of macroeconomic modelling and forecasting at NIESR.

　　"It's not a very pleasant scenario," NIESR director Jajay Chadha said in an interview with Bloomberg TV.

　　"Because the government is now spending more than it takes in, growth is constrained. Even at full employment, we often run a fiscal deficit, which for us means we have a structural fiscal deficit. With fiscal constraints, financial markets do not want to absorb more debt relative to our lower income levels, so the room for manoeuvre will be limited." "He added.