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United Kingdom

Capital city: London

Population: 67.3 million (2021)

Land area: 243 610 km²

Official language: English

Legal system: : Common law (England and Wales); Mixed legal system (Scotland); Statute and common law (Northern Ireland)

Time zone: GMT+1

Currency: Pound sterling

GDP: 3,186.86 USD Billion

Main industries: Banking and Finance, Steel, Transport Equipment, Oil and Gas, and Tourism

Principal exports: Cars, Gas Turbines, Crude Petroleum, Gold

Joined Commonwealth: 1931

United Nations HDI Ranking (2019): 0.932

 

The United Kingdom (UK), officially known as the United Kingdom of Great Britain and Northern Ireland, is a sovereign state located off the northwestern coast of continental Europe. The UK is a constitutional monarchy and a unitary state composed of four countries: England, Scotland, Wales, and Northern Ireland. The UK has a rich and varied history, with influences from the Celts, Romans, Anglo-Saxons, Vikings, and Normans, among others. It has played a major role in world history, including in the development of parliamentary democracy, the Industrial Revolution, and both World Wars. Today, the UK is a highly developed country with a strong economy, diverse culture, and significant influence in global politics. It is known for its contributions to literature, music, and the arts, as well as its sports, such as football (soccer), cricket, rugby, and tennis. The UK is also home to many iconic landmarks and attractions, such as Buckingham Palace, Stonehenge, the Tower of London, and Big Ben.

The UK is surrounded by the Atlantic Ocean, the North Sea, the English Channel, and the Irish Sea. The landscape of the UK is diverse, ranging from rugged coastlines and mountains to rolling hills and lowlands. England is mainly composed of lowland areas with some hilly regions, such as the Pennines and Cotswolds. The country is bordered by the Irish Sea to the west, the North Sea to the east, and the English Channel to the south. Scotland, located in the northern part of the UK, has a rugged landscape dominated by mountainous regions such as the Scottish Highlands, including Ben Nevis, the highest peak in the UK. The country is surrounded by the Atlantic Ocean to the north and west, the North Sea to the east, and shares a border with England to the south. Wales is a mountainous country, with the Cambrian Mountains and the Brecon Beacons National Park located in the central part of the country. The coastline of Wales features sandy beaches, rocky cliffs, and picturesque bays. Northern Ireland is located on the island of Ireland and shares a land border with the Republic of Ireland to the south. The landscape of Northern Ireland is characterized by rolling green hills, glacial valleys, and rocky coastlines.

Demographics

The United Kingdom has a recorded population of 67.3 million, England comprising 84.3%, Scotland 8.2%, Wales 4.6% and Northern Ireland 2.8%; the growth rate in early 2023 was recorded to be 0.49%. The UK has a high rate of urbanisation with 84.6% of the entire population residing in urban settlements. In terms of age structure, the UK has a mature population with approximately 17% aged 14 or under.

87.2% of the population of the UK is White; African and Caribbean British make up 3% of the population, British Indians 2.3%, British Pakistanis 1.9% while the remaining are of other or mixed ethnicities. English is the official language as well as the lingua franca though Scottish Gaelic, Welsh, Irish and Cornish are also common vernaculars. In the official 2021 census, 46.2% identified as Christian, 12% identified as atheist, 6.5% identified as Muslim and 1.7% identified as Hindu whilst the remain opted to remain unspecified.

History

The history of the United Kingdom dates back thousands of years, with evidence of early human settlements dating back to the Paleolithic era. However, the story of the modern United Kingdom begins with the arrival of the Celts in the 6th century BCE. The Celts, who were originally from Central Europe, established a number of kingdoms throughout what is now the United Kingdom, including Wales, Scotland, and Cornwall. They were eventually conquered by the Romans, who invaded Britain in 43 CE and established the province of Britannia. The Romans remained in Britain for nearly four centuries, during which time they built a number of cities, roads, and other infrastructure.

In the 5th century CE, the Roman Empire began to decline, and the legions stationed in Britain were recalled to the continent. This left the country vulnerable to invasion by the Germanic tribes, who began to raid and settle in eastern and southern England. These tribes, including the Angles, Saxons, and Jutes, eventually established a number of kingdoms, including Wessex, Mercia, and Northumbria.

In 1066, the Norman Conquest brought another wave of change to Britain. William the Conqueror, a Norman noble, invaded England and defeated King Harold II at the Battle of Hastings. This led to the establishment of the Norman dynasty, which ruled England for nearly three centuries. During this time, the Normans introduced a number of reforms, including the creation of the feudal system and the construction of castles and cathedrals. In the late Middle Ages, England experienced a period of great upheaval. The Hundred Years’ War with France, which began in 1337, drained the country’s resources and led to widespread social unrest. The Black Death, which struck in the mid-14th century, killed up to half of the country’s population and led to a shortage of labor. This in turn led to the rise of a new class of landowners, known as yeomen, who began to demand greater political and economic rights. In 1485, the Tudor dynasty was established with the ascension of Henry VII to the throne. The Tudors, who ruled England until 1603, oversaw a period of great cultural and political growth. During this time, England emerged as a major naval power, with the defeat of the Spanish Armada in 1588 cementing its dominance of the seas. The Tudors also oversaw the English Reformation, which saw the Church of England break away from the Roman Catholic Church.

The 17th century was a turbulent period in the history of the United Kingdom. It was marked by the Civil War, which took place between 1642 and 1651. The war was fought between the supporters of the King (the Royalists) and the supporters of Parliament (the Roundheads). The war ended with the execution of King Charles I in 1649, the establishment of the Commonwealth, and the rule of Oliver Cromwell. Cromwell’s death in 1658 led to the restoration of the monarchy and the return of Charles II to the throne in 1660.

During the 18th century, the United Kingdom became a major colonial power, with the British Empire expanding to include India, Canada, and Australia, among other territories. The Industrial Revolution, which began in the late 18th century, transformed the economy, society, and culture of the country. It was marked by advances in technology, such as the steam engine and the spinning jenny, and the growth of new industries such as textiles, coal mining, and iron production. In the 19th century, the United Kingdom continued to expand its empire, with the colonization of Africa and parts of Asia. The Victorian era, named after Queen Victoria who ruled from 1837 to 1901, was a time of significant social, cultural, and economic change. The country saw the growth of the middle class, the rise of organised labor, and the extension of the franchise to more people. The period was also marked by significant cultural achievements, including the works of Charles Dickens, Jane Austen, and the Bronte sisters.

The 20th century was marked by two World Wars, which had a profound impact on the United Kingdom. During World War I, which lasted from 1914 to 1918, the country suffered significant losses and saw a decline in its economic and political power. The interwar period, between the two world wars, saw the rise of the Labour Party and the extension of the welfare state. However, the country was again plunged into war in 1939, with the outbreak of World War II. During World War II, the United Kingdom played a key role in the defeat of Nazi Germany. After World War II, the United Kingdom, along with other countries in Europe, was left devastated by the war. The country was heavily in debt, its infrastructure had been severely damaged, and its people were suffering from a shortage of basic necessities. Despite these challenges, the post-war period saw the UK emerge as a major world power and undergo significant social, economic, and political changes. One of the most notable changes in the post-war era was the creation of the welfare state. In 1945, the Labour Party, led by Clement Attlee, won a landslide victory in the general election and introduced a series of reforms aimed at improving the lives of ordinary citizens. The National Health Service (NHS) was established to provide free healthcare for all, while a range of other social welfare programs were introduced, including unemployment benefits and family allowances. These reforms helped to create a more egalitarian society and improved the standard of living for many.

At the same time, the post-war era saw the UK become increasingly involved in international affairs. In 1949, the country joined the North Atlantic Treaty Organization (NATO), which established a mutual defense agreement between member states. The UK also played a key role in the formation of the European Union (EU), signing the Treaty of Rome in 1957, which created the European Economic Community (EEC). During the 1950s and 1960s, the UK experienced significant economic growth, known as the “post-war boom”. This was fueled by the rebuilding of the country’s infrastructure, as well as increased investment in industry and technology. However, the boom was not without its challenges. In the late 1960s, the UK faced increasing economic difficulties, including rising inflation and high unemployment, leading to a period of industrial unrest and social upheaval.

In the 1970s, the UK faced a number of significant challenges, including rising inflation, high unemployment, and political instability. In 1973, the country joined the EEC, but this also led to tensions over issues such as immigration and the loss of national sovereignty. The 1970s also saw a rise in social and political unrest, including the rise of nationalist movements in Scotland and Wales, and terrorist attacks by the Irish Republican Army (IRA).

The 1980s saw a significant shift in UK politics, as the Conservative Party, led by Margaret Thatcher, came to power in 1979. Thatcher’s government implemented a range of free-market economic reforms, known as “Thatcherism”, which aimed to reduce government intervention in the economy and promote individual responsibility. This led to a period of economic growth and job creation, but also resulted in significant social inequalities and a rise in poverty and homelessness. In the 1990s, the UK saw further political and social changes, including the rise of the New Labour movement under Tony Blair. Blair’s government introduced a range of reforms aimed at improving public services and reducing social inequalities, including the introduction of the minimum wage and increased investment in education and healthcare. The 1990s also saw the UK play a key role in international affairs, including its involvement in the Gulf War and the conflict in the former Yugoslavia.

The 21st century has seen the UK face a range of significant challenges, including the global financial crisis of 2008 and the ongoing Brexit negotiations, which have seen the country leave the EU. However, the country has also seen significant progress in areas such as technology, with the rise of tech startups and the development of new industries such as fintech and biotech.

Key Dates

1603- James VI of Scotland becomes King James I of England, uniting the crowns of England and Scotland.

1642-1651- English Civil War between Parliamentarians and Royalists, resulting in the execution of King Charles I and the establishment of the Commonwealth under Oliver Cromwell.

1660- Restoration of the monarchy under King Charles II.

1688-1689- Glorious Revolution, in which King James II is overthrown and replaced by William III and Mary II in a bloodless coup.

1707- Act of Union unites England and Scotland into the Kingdom of Great Britain.

1801- Act of Union unites Great Britain and Ireland into the United Kingdom of Great Britain and Ireland.

1832- Great Reform Act increases the number of eligible voters in England and Wales.

1837-1901- Reign of Queen Victoria, a period of significant industrialization and expansion of the British Empire.

1859- Publication of Charles Darwin’s “On the Origin of Species,” which revolutionizes scientific understanding of evolution.

1914-1918- First World War, in which the UK plays a major role and suffers significant casualties.

1918- Representation of the People Act gives women over 30 the right to vote, as well as all men over 21.

1922- Irish Free State gains independence, leaving Northern Ireland as part of the UK.

1939-1945- Second World War, in which the UK again plays a major role, suffering significant damage and loss of life during the Blitz.

1945- Labour Party wins a landslide victory in the general election, leading to the establishment of the welfare state and nationalization of key industries.

1952- Accession of Queen Elizabeth II to the throne.

1956- Suez Crisis, in which the UK, France, and Israel attempt to seize control of the Suez Canal, but are forced to withdraw by international pressure.

1960s- Significant social and cultural changes, including the rise of youth culture and the feminist movement.

1973- UK joins the European Economic Community, precursor to the European Union.

1982- Falklands War, in which the UK successfully defends its control of the Falkland Islands from Argentina.

1997- Establishment of the Scottish Parliament and Welsh Assembly.

2014- Scottish independence referendum, in which a majority of Scottish voters choose to remain part of the UK.

2016- UK votes to leave the European Union in the Brexit referendum.

2023- Accession of King Charles III to the throne.​

 

Legal System and Government

The United Kingdom is a parliamentary democracy and a constitutional monarchy. The monarch is the head of state, but has limited powers and serves a largely ceremonial role. The government is headed by the Prime Minister, who is appointed by the monarch and is usually the leader of the political party with the most seats in the House of Commons, the lower chamber of Parliament. The UK has a multi-party system, with several political parties vying for representation in Parliament. The two main political parties are the Conservative Party and the Labour Party, with the Scottish National Party, Liberal Democrats, and others also holding seats in Parliament.

The UK has a bicameral Parliament, which consists of the House of Commons and the House of Lords. Members of the House of Commons, also known as MPs, are elected by the people of the UK in general elections held every five years. The House of Lords is mainly made up of appointed members, including life peers, hereditary peers, and bishops of the Church of England. Devolved governments exist in Scotland, Wales, and Northern Ireland, with each having its own Parliament or Assembly and varying levels of autonomy in certain policy areas. The UK government retains control over areas such as defense, foreign policy, and economic policy.

The UK has a common law legal system, which is also known as case law or judge-made law. This means that the law is largely based on precedent set by previous court cases, rather than written laws or statutes. The UK’s legal system is also based on the principle of parliamentary sovereignty, which means that the UK Parliament has the ultimate authority to make or unmake any law. This means that no other body or institution can overrule or challenge the laws made by Parliament.

The judiciary is made up of judges who interpret and apply the law. They are independent from the other two branches of government (the executive and the legislature) and are responsible for upholding the rule of law. The most senior court in the UK is the Supreme Court, which was established in 2009 to replace the House of Lords as the final court of appeal in the UK. Other important courts include the Court of Appeal, the High Court, and the Crown Court.

The legislature is responsible for making new laws and amending existing ones. The UK Parliament is made up of two houses: the House of Commons and the House of Lords. The House of Commons is composed of elected Members of Parliament (MPs), while the House of Lords is made up of appointed members, including life peers and bishops. The House of Commons has the power to introduce, debate, and vote on bills, which can then be sent to the House of Lords for review and amendment. Once a bill has been passed by both houses of Parliament, it must be given Royal Assent by the monarch before it becomes law. Lastly, the executive is responsible for implementing and enforcing the law. This includes the police, who investigate crimes and maintain public order, and the Crown Prosecution Service, which prosecutes criminal cases on behalf of the state. The executive also includes government departments and agencies, such as the Home Office and the Ministry of Justice.

Economy

The United Kingdom is a high-income country; it’s a mixed-market economy ranked the second largest in Europe and the sixth largest worldwide, as of 2022. It is one of the most globalised and diversified economies in the world, with extensive trade links and a strong service sector.

The services sector is the most salient contributor to the economy, accounting for 71.5% of GDP and employs 81% of the working population. The UK ranks second on the Global Financial Centre Index, its international financial reach unmatched as it was amongst the very few nations that increased financial exports during the COVID-19 pandemic. London is the leading destination for investment in financial services and continues to the top global foreign exchange trading centre. London is also the leader in the information and communication technology sector across Europe, housing more than a quarter of the region’s unicorns and Fortune Global 500 firms. Asset management is another service UK dominates in. Apart from financial services, the retail industry is also significant, contributing around 5.2% of GDP; the tourism industry is also a salient part of the service sector and it is set to increase its GDP contribution to 10% by 2025.

The industrial sector contributes 17.5% of GDP and employs about 15% of the working population, of which manufacturing contributes 9% to GDP; industries such as aerospace, automotive, and pharmaceuticals are leading the sector as the nation is s home to some of the world’s largest aerospace and defense companies, such as BAE Systems and Rolls-Royce. The energy sector is also significant in the UK, with oil and gas exploration and production in the North Sea and offshore wind farms providing a growing source of renewable energy. The UK government plays an important role in the economy through its fiscal and monetary policies. The Bank of England is responsible for setting monetary policy, such as interest rates, to control inflation and maintain economic stability. The government also sets fiscal policies, such as taxation and spending, to influence economic growth and stability.

In terms of agriculture, the sector makes up 0.7% of GDP and employs 1% of the labour force. The UK’s agricultural sector has a long history and plays an important role in the country’s economy. It is characterized by a diverse range of farming practices and produces a variety of crops and livestock. Some of the key crops produced in the UK include wheat, barley, oats, potatoes, sugar beets, and rapeseed. The UK is also a major producer of dairy products, beef, lamb, and poultry.

Farming practices in the UK vary depending on the type of agriculture and the region. There are large-scale commercial farms, as well as smaller family-run operations. Some areas of the country are particularly known for specific crops, such as apples in the West Country, strawberries in Kent, and potatoes in Lincolnshire. In recent years, the UK’s agricultural sector has faced some challenges, such as changing climate patterns, increasing competition from foreign imports, and uncertainty around Brexit. However, the sector has also seen significant investment in research and development, as well as in sustainable farming practices.

Trade

The United Kingdom’s GDP in 2022 was recorded to be US$3.07 trillion. In the same year, the nation exported US$526.2 billion worth of merchandise, the top export items including natural or cultured pearls, precious or semi-precious stones and metals (18.3%), machinery, mechanical appliances and parts thereof (14.2%), mineral fuels and oils and products of their distillation (10.8%) and vehicles other than railway/tramway rolling stock (7.7%). These products were exported to leading trade partners including the United States (12.0%), The Netherlands (8.2%), Germany (7.8%) and Switzerland (6.5%). In terms of imports for 2022, the UK imported US$815.1 billion worth of products, the top import items including mineral fuels and oils and products of their distillation (16.8%), machinery, mechanical appliances and parts thereof (10.9%), vehicles other than railway/tramway rolling stock (9.1%) and electrical machinery, electronics and parts thereof (8.2%). Imports for the year were largely sourced from China (12.5%), the United States (12.0%), Germany (8.7%) and Norway (6.5%).

The United Kingdom has over 70 bilateral trade agreements, including with Commonwealth nations Australia, Canada, Cameroon, Ghana, Kenya, Singapore and Fiji amongst more. In terms of regional trade agreements, the UK has signed bilateral trade agreements with regional groups including CARIFORUM, the Southern African Customs Union (SACU) and the nation is currently in the process of becoming a signatory of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Investment Opportunities

The United Kingdom has a stable and open economy with a thriving business environment, a rich history of diversified exports, trade and commerce and a wealth of strategic trade alliances both as a gateway into the European Union and the numerous trade agreements it has accumulated over the years. The UK has a highly skilled and almost fully educated workforce with particular expertise in STEM fields with the support of several financial and non-financial government initiatives. The country has a high standard of living with comprehensive healthcare, stunning cosmopolitan skylines and equally beautiful and contrasting countryside with diverse communities making it an ideal destination for investment, business as well as migration.

There are countless opportunities for capital investments, joint ventures, private-public partnerships and real estate investments in the UK. For example, the aerospace industry in the UK is amongst the very best in the world; it is dynamic, innovative and focused on the government’s commitment to net zero emissions, working towards the generation of clean and green energy that can be assimilated into the industry as stated under the Prime Minister’s Ten Point Plan and Jet Zero strategy. Foreign investors interested in investing will find state of the art composite material manufacturing, whole-aircraft capability and advanced expertise in aerostructures. Another target for clean energy envisaged in the UK’s net zero emissions target is Carbon Capture, Usage & Storage (CCUS); the government plans to establish CCUS in at least two industrial clusters by 2025 with the goal to store 20-30 megatonnes of carbon dioxide a year by 2030. The UK Continental Shelf has the potential to store 78 billion tonnes of CO2 and foreign investment looking into harnessing this and helping pave the way for clean energy via research and development is greatly encouraged. Another green technology area of focus is ecological infrastructure, making buildings more energy efficient via contemporary construction methods and circular economy principles, as stipulated under the C0nstruct Zero programme. The UK also offers exciting opportunities in agricultural technology (agri-tech) as it is home to some of the world’s leading research institutions in agriculture and technology, such as Rothamsted Research and the University of Cambridge, and as the domestic and international market grows, investors can capitalise on one of Europe’s biggest agricultural market’s innovations leading the development of plant science, sustainable farming systems and manufacturing. Other sectors for investments focusing on green science and sustainability include offshore wind farms, hydrogen, zero emission automobiles, transition fuels, green finance and green shipping.

Investment and development of cybersecurity initiatives in the UK have also created immense opportunities for all businesses looking into developing products and applications for levelling up security for corporate and/or private servers, particularly as global cyber warfare continues to escalate. Another sector that has gained momentum since the COVID-19 pandemic is the Sports economy; considering the UK’s role in hosting prestigious global sports events such as the 2012 Olympics and the 2022 Birmingham Commonwealth Games, the government is planning to host a further 97 major sporting events over the next decade therefore providing countless project opportunities for interested foreign investors. A prime destination for foreign capital investment is the UK’s retail sector which is home to one of the largest e-commerce markets with amongst the most dense international retail traffic and activity and a 31% share of the elite shopper consumer market. This presents a plethora of opportunities for investment into high-end shopping, mobile retail, sustainable fashion and SME support.

The UK offers a range of investment incentives for foreign investors. For example, the government has set up a £160 million fund to support the development of new agri-tech innovations, and there are a number of research centers and incubators across the country that provide support to agri-tech start-ups. The UK does not offer tax holidays as such, but it does offer a range of tax incentives and reliefs for foreign investors; the UK has a lower corporation tax rate of 19% (as of 2022) compared to many other countries, which can make it an attractive location for setting up a business. Additionally, the UK has a number of tax relief schemes that encourage investment in certain sectors or regions, such as the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS). These schemes provide tax relief on investments made in qualifying businesses, which can help to mitigate the risks associated with investing in early-stage companies. The UK also offers a range of other tax incentives, such as research and development tax credits, which can help to reduce the overall tax liability for foreign investors. The UK government also offers several tax incentives for green finance investments to encourage businesses to adopt environmentally sustainable practices such as the Green Investment Tax Allowance provides businesses with tax relief on investments in qualifying green technologies, including energy-efficient equipment and zero-emissions vehicles; Enhanced Capital Allowances (ECAs) allow businesses to claim 100% first-year capital allowances on investments in energy-saving equipment and technologies, such as boilers, lighting systems, and energy-efficient air conditioning; and the Renewable Heat Incentive (RHI) is a government scheme that provides financial incentives for the installation of renewable heat technologies, such as biomass boilers, solar thermal systems, and heat pumps. Additionally, it is useful to note that although there is a Climate Change Levy (CCL) which is a tax on energy use in the UK, businesses investing in renewable energy technologies, such as wind and solar, are exempt from paying the CCL.

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