section_path: Economy
section_name: Economy
paragraph_text: Economy
  
  The UK has a regulated social market economy. Based on market exchange rates, the UK is the sixth-largest economy in the world and the second-largest in Europe by nominal GDP. Its currency, the pound sterling, is the fourth most-traded currency in the foreign exchange market and the world's fourth-largest reserve currency (after the United States dollar, euro, and yen). Sterling was the 2nd best-performing G10 currency against the dollar in 2023 with a gain of about 5%, with only the Swiss franc performing better. London is the world capital for foreign exchange trading, with a global market share of 38.1% in 2022 of the daily $7.5 trillion global turnover.
  
  HM Treasury, led by the Chancellor of the Exchequer, is responsible for developing and executing the government's public finance policy and economic policy. The Department for Business and Trade is responsible for business, international trade, and enterprise. The Bank of England is the UK's central bank and is responsible for issuing notes and coins in the pound sterling. Banks in Scotland and Northern Ireland retain the right to issue their own notes, subject to retaining enough Bank of England notes in reserve to cover their issue. In 2022, the UK became the world's fourth-largest exporter behind only China, the US, and Germany. The estimated nominal GDP of the UK for 2024 is £2.765 trillion. This value is 23% higher than the 2019 figure of £2.255 trillion before leaving the EU (at similar US and EU exchange rates to 2019). Inflation in the UK rose by 2% in the year to May 2024 which was the governments target.
  
  The service sector made up around 80% of the UK's GVA in 2021. As of 2022, the UK is the world's second-largest exporter of services. London is one of the world's largest financial centres, ranking second in the world in the Global Financial Centres Index in 2022. London also has the largest city GDP in Europe. Edinburgh ranks 17th in the world, and sixth in Western Europe in the Global Financial Centres Index in 2020.
  
  The country's tourism sector is very important to the British economy; London was named as Europe's most popular destination for 2022. The creative industries accounted for 5.9% of the UK's GVA in 2019, having grown by 43.6% in real terms from 2010. Creative industries contributed more than £111bn to the UK economy in 2018, growth in the sector is more than five times larger than growth across the UK economy as a whole as reported in 2018. Lloyd's of London is the world's largest insurance and reinsurance market and is located in London. WPP plc, the world's biggest advertising company, is also based in the UK. The UK is one of the leading retail markets in Europe and is home to Europe's largest e-commerce market. With consumption expenditures of over $2 trillion in 2023, the UK has the second-largest consumer market in Europe. John Lewis is the UK's largest employee-owned business.
  
  The British automotive industry employs around 800,000 people, with a turnover in 2022 of £67 billion, generating £27 billion of exports (10% of the UK's total export of goods). In 2023, the UK produced around 905,100 passenger vehicles and 120,400 commercial vehicles, output was up 17.0% on the previous year. Britain is known for iconic cars such as Mini and Jaguar, also other luxury cars such as Rolls-Royce, Bentley and Range Rover. The UK is a major centre for engine manufacturing: in 2022 around 1.5 million engines were produced. It is also the world's fourth-largest exporter of engines, as of 2021. The UK motorsport industry employs more than 40,000 people, comprises around 4,300 companies and has an annual turnover of around £10 billion. 7 of the 10 Formula One teams are based in the UK, with their technology being used in supercars and hypercars from McLaren, Aston Martin and Lotus.
  
  The aerospace industry of the UK is the second-largest national aerospace industry in the world depending upon the method of measurement and has an annual turnover of around £30 billion. The UK space industry was worth £17.5bn in 2020/21 and employed 48,800 people. Since 2012, the number of space organisations has grown on average nearly 21% per year, with 1,293 organisations reported in 2021. The UK Space Agency has stated in 2023 that it is investing £1.6 billion in space-related projects.
  
  Its agriculture industry is intensive, highly mechanised and efficient by European standards, producing approximately 60% of the country's overall food requirements and 73% of its indigenous food needs, utilising around 0.9 per cent of the labour force (292,000 workers). Around two-thirds of production is devoted to livestock, one-third to arable crops. The UK retains a significant, though much reduced fishing industry. It is also rich in a variety of natural resources including coal, petroleum, natural gas, tin, limestone, iron ore, salt, clay, chalk, gypsum, lead, silica and an abundance of arable land. The UK has among the highest levels of income inequality in the OECD, but has a very high HDI ranking.