section_path: Economy
section_name: Economy
paragraph_text: Economy
  
  The UK has a highly developed social market economy. Based on market exchange rates, it is the sixth-largest economy in the world and the second-largest in Europe, both 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, the euro and the yen). The pound sterling maintains its high nominal value through both its long history of stability and by never undergoing formal redenomination. London is the world capital for foreign exchange trading, with a market share of 38.1 per cent in 2022 of the daily US$7.5 trillion global turnover. The UK has amongst the highest levels of income inequality in the OECD, but has a very high HDI ranking.
  
  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. The Bank of England is exploring a digital pound (CBDC) to enable instant settlement and improve payment infrastructure. In 2022 the UK became the world's fourth-largest exporter behind 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).
  
  The service sector made up around 80 per cent of the UK's GVA in 2023. As of 2023 the UK is the world's second-largest exporter of services. In 2023 the UK was 13 per cent above its pre-pandemic and pre-Brexit peak in 2019 for service exports. The UK was the world's largest net exporter of financial services in 2024. London is one of the world's leading financial centres, ranking second in the world in the Global Financial Centres Index in 2025. 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 per cent of the UK's GVA in 2019, having grown by 43.6 per cent in real terms from 2010. Creative industries contributed more than £111 billion 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 is one of the world's biggest advertising companies and 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 US$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 UK's manufacturing sector in 2023 was the world's 11th largest and the 4th largest in Europe. Due to a period of high domestic inflation caused by covid, high energy prices and supply chain shocks, the UK imported and exported less physical goods in 2023 than in 2018. At the end of 2024 manufacturing in the United Kingdom accounted for 8 per cent of the workforce and 8.6 per cent of national economic output. As reported in 2017 the East Midlands and West Midlands (at 12.6 and 11.8 per cent respectively) were the regions with the highest proportion of employees in manufacturing. London's manufacturing sector had the lowest at 2.8 per cent.
  
  The British automotive industry employs 813,000 people, with a turnover in 2023 of £93 billion, generating £47 billion of exports (12 per cent of the UK's total exports of goods). In 2024 the UK produced 779,584 passenger vehicles and 125,649 commercial vehicles; 8 out of 10 cars produced in the UK are exported overseas. Britain is known for iconic cars such as Mini and Jaguar, as well as luxury cars such as Rolls-Royce, Bentley and Range Rover. The UK is a major centre for engine manufacturing: in 2024 1.59 million engines were produced. It is the world's third-largest exporter of engines as of 2023. The UK motorsport industry employs more than 40,000 people, comprises around 4,300 companies and has an annual turnover of around £10 billion. Seven of the ten Formula One teams are based in the UK, with their technology being used in supercars and hypercars from McLaren, Aston Martin and Lotus. In 2024 the UK surpassed Germany to become the largest market for electric vehicles in Europe.
  
  The aerospace industry of the UK is the second-largest in the world and has an annual turnover of around £30 billion. The UK space industry was worth £17.5 billion in 2020/21 and employed 48,800 people. Since 2012 the number of space organisations has grown on average nearly 21 per cent 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.
  
  British agriculture industry is intensive, highly mechanised and efficient by European standards, producing approximately 60 per cent of the country's overall food requirements and 73 per cent 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, with at least 49 per cent of UK fish sustainably caught in 2020. The UK marine natural capital assets were estimated to have a value of £211 billion in 2021. It is rich in a variety of other natural resources including coal, petroleum, natural gas, tin, limestone, iron ore, salt, clay, chalk, gypsum, lead, silica and an abundance of arable land.