A wealthy, open, and highly diversified economy. High fiscal flexibility, underpinned by moderate general government debt. A well-established political system producing stable majorities and a powerful executive. Structural fiscal imbalances. Gently rising external imbalances. High household indebtedness. The ratings on the United Kingdom (U.K.) are supported by one of the most diversified and resilient economies among 'AAA' rated peers, with GDP of $2.2 trillion in 2005. The U.K.'s economic growth has been mainly driven by macroeconomic stability, microeconomic liberalization, fiscal flexibility, job growth, and a productive labor force. The general government revenues-to-GDP ratio remains among the lowest in high-income countries, as does net debt, providing the U.K. with significant revenue-raising flexibility and ample room for maneuver to adjust fiscal performance.
