PESTLE Analysis of UK

Topics: Economic growth, European Union, United Kingdom Pages: 144 (22108 words) Published: October 27, 2014
Country Profile Series

United Kingdom
In-depth PESTLE insights

PESTLE Country Analysis Report: United Kingdom

© MarketLine. This report is a licensed product and is not to be photocopied



ML00002-031/Published 05/2013
Page 1

This profile analyzes the political, economic, social, technological, legal and environmental (PESTLE) structure in the UK. Each of the PESTLE factors is explored on four parameters: current strengths, current challenges, future prospects, and future risks.

Key findings
The UK has a strong democratic system, but differences between coalition partners in the incumbent government pose a challenge
The UK adheres to a democratic, parliamentary system of governance known as the Westminster system. This system ensures adequate distribution of power between the executive branch led by the prime minister, the bicameral legislature and the judiciary.

Growing ideological differences between the Conservatives and Liberal Democrats in the current government is making the coalition vulnerable. Tensions between pro-Europe Liberal Democrats and euroskeptic Conservatives continue to plague British politics. Further, conflicting views on issues such as welfare reforms, immigration and the economy are straining relations.

The UK economy is developed, but rising government debt remains a concern The UK is one of the largest economies in the EU and is one of the strongest in terms of social welfare and standard of living. Among the EU countries, the UK has one of the highest levels of per capita GDP in terms of purchasing power parity. According to the World Bank's Doing Business indicators for 2013, the UK is the seventh best country in the world to do business. The country ranks first in ―getting credit‖, implying that any company wishing to enter the UK faces fewer hurdles to procure the both working capital and long-term capital requirements. The UK’s government debt has been increasing constantly, and at £1.38 trillion ($2.11 trillion), reached an alarming figure of around 90.0% of GDP in 2012 according to Eurostat. It would be difficult for the government to service its ballooning debt against the backdrop of a contracting economy. The country has a strong education and health sector, but income inequality is still apparent The educational infrastructure in the UK is considered to be of very high quality and has historically attracted students from all parts of the globe. The nation’s tradition of education dates back hundreds of years and is constantly evolving. Academic credentials acquired from UK institutions are recognized and respected throughout the world. The UK has around 170 universities and higher education institutes, including three universities in the world's top 10, according to The Times Higher Education World University Rankings 2012–2013. The ranking was based on teaching, research, knowledge transfer and international outlook. The UK’s healthcare system is one of the most successful social ventures in the world. This success can be attributed to the presence of advanced healthcare infrastructure and the involvement of the private sector. Public expenditure on health in the UK has traditionally been very high in order to maintain the quality of services provided.

However, rising inequality is a concern. According to the OECD Database on Household Income Distribution and

PESTLE Country Analysis Report: United Kingdom
© MarketLine. This report is a licensed product and is not to be photocopied

ML00002-031/Published 05/2013
Page 2

Poverty, from the mid-1980s to the late 2000s, real household income for the bottom decile grew by 0.9% annually while it grew by 2.5% for the top decile. The growth in inequality is more than the OECD27 average. The UK has strong scientific and research...
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