Can you imagine that the former "empire on which the sun never sets" went bankrupt overnight? Since the end of the United Kingdom general election, the new cabinet of the United Kingdom has come to power, and in the face of the mess left by the previous government, the first thing to do is to solve the problem of fiscal crisis. On July 29, United Kingdom local time, United Kingdom Chancellor of the Exchequer Rachel · Reeves released a fiscal assessment report to the United Kingdom Congress, and the results were surprising. According to data released by United Kingdom Prime Minister Starmer the day before, there are currently 20 billion pounds in United Kingdom's finances.
It stands to reason that the emaciated camel is bigger than the horse, and United Kingdom is still one of the five permanent members of the United Nations, and a mere £20 billion is not enough for the government to uncover the pot. As far as the United Kingdom Royal Navy is concerned, the cost of the two aircraft carriers "Queen Elizabeth" and "Prince of Wales" alone is as high as 5 billion US dollars, plus the cost of escort formations, personnel, maintenance, etc., 20 billion pounds is only enough to feed one or two aircraft carrier formations, which is not a matter at all. Speaking of aid to Ukraine, in April this year, when then United Kingdom Prime Minister Sunak visited Poland, Chrysostom opened and added 500 million pounds of military aid to Ukraine. Since then, United Kingdom's military aid to Ukraine has totalled £3 billion in the 2024 financial year alone. In this way, how can the deep-pocketed United Kingdom government be overwhelmed by 20 billion?
In fact, the reason why the Starmer government cried poverty at the beginning of its rise was to continue to chase and beat the Conservative Party in the party struggle, because according to him, the United Kingdom government went bankrupt because the Conservative Party left a mess during its rule. Combined with the United Kingdom's fiscal situation, in the 2023-24 financial year, the total public sector revenue in the United Kingdom reached 1,095.1 billion pounds, and the size of the deficit was 120.7 billion pounds. From this ratio, the United Kingdom's deficit is not serious, and the real reflection of the government debt crisis is the proportion of net debt. The data shows that United Kingdom's net debt as a percentage of GDP is 98.3%, exceeding the internationally accepted debt red line of 60%, and the fiscal deficit as a proportion of GDP also exceeds the debt warning red line of 3%. However, from an economic point of view, this figure has not yet reached the level of "government bankruptcy". Because in developed countries, there are many countries whose debts exceed the red line of early warnings. In the case of Japan, the world's fourth-largest economy, its government debt has exceeded 200% of GDP.
Without much pressure, the Starmer government openly cried about poverty, more to shirk responsibility and guide the people to jointly target the previous government. However, in the long run, with the current state of the United Kingdom's economy, government minerals are also a matter of time. Because the Starmer government inherited a mess, in terms of foreign policy, the United Kingdom government has also completely turned to United States and opposed China at every turn. In the face of the pies drawn by United States, United Kingdom not only did not taste a little sweetness, but missed a lot of development opportunities.
In the case of the trade war and technology war launched by the United Kingdom against China, the United Kingdom government bans the use of cheap and high-quality Huawei equipment, preferring to suffer tens of billions of dollars in losses and squeeze Huawei and other Chinese 5G companies out of the United Kingdom market. Completely following the United States to oppose China, Sino-British relations fell to the freezing point, the "golden decade" between China and Britain came to an abrupt end, and a large number of economic cooperation came to a standstill. You know, United Kingdom was originally a country dominated by the financial services industry, and it needs more countries based on the real economy to support, and the Chinese and British economies originally had many complementary places of cooperation, but because of United Kingdom's insistence on going their own way, it was in vain.
After declaring "bankruptcy", the Starmer government began to gradually "liquidate" the Conservative Party and also began to plan for the future. In particular, on the resumption of China-UK cooperation, the UK side intends to meet with Foreign Minister Wang Yi to seek cooperation. In this regard, we are still in a wait-and-see mode.
Although it is in the interests of both sides to carry out in-depth economic cooperation between China and the UK, China does not have to cooperate with the United Kingdom. United Kingdom show sincerity, we must not continue to interfere in China's internal affairs, nor can we follow United States long-term anti-China affairs. If these two points cannot be achieved, what awaits United Kingdom will really be the end of bankruptcy and collapse.