External Transactions

Abstract

There are enormous differences in the extent to which individual nations are dependent upon transactions with the outside world. The UK has always been an ‘open’ economy, both importing and exporting on a massive scale. Superficially this may simply be seen to reflect the difficulties which any nation the size of the UK must inevitably face in trying to be self-sufficient across the whole range of goods and services, but it is important to note both that the UK’s degree of openness has been increasing steadily over the past several decades (as has also been true elsewhere in the EC), and that external transactions increasingly involve one-way flows of capital which are unrelated to the immediate consumption requirements of UK residents.