Jumana Saleheen's picture
Affiliation: 
Vanguard Asset Management
Credentials: 
Chief Economist

Voting history

Prospects for UK Economic Growth

Question 2: What is the most important contribution economic policymakers can make growth in the UK over the next decade? 

Answer:
Other or don't know
Confidence level:
Confident
Comment:
I think the most important action policy makers can take is on climate change. Policymakers must set out policies and regulations that incentivise business to select the early action (orderly path) to net zero. These policies must go beyond the high level net zero commitments. They must be detailed, like the EU taxonomy and EU fit for 55 policies. They should include plans to increase carbon prices, and expand its use, as a way to internalise the price of greenhouse gas emissions.

Question 1: How do you see prospects for future (per capita) GDP growth in the UK in the next decade?

Answer:
Other or don’t know
Confidence level:
Confident
Comment:
I expect moderate annual growth over the next decade. Growth over the next decade will be similar to growth over the past decade, averaging around 2% per year.

Effects of an embargo on Russian gas

Question 2: By how much would an immediate EU-wide import ban on Russian gas reduce German GDP growth per annum in 2022-3, in percentage points (pp), if the government offset the costs with a well-targeted fiscal policy?

Answer:
Between 1pp and 3pp
Confidence level:
Confident
Comment:
An EU ban on Russian energy is likely to lead to a recession in Germany. This could prompt a large fiscal package which could offset most, but not all of the fall in output.

Question 1: By how much would an immediate EU-wide import ban on Russian gas reduce German GDP growth per annum in 2022-3, in percentage points (pp), absent other policies?

Answer:
Between 3pp and 5pp
Confidence level:
Not confident
Comment:
Germany is one of the largest importers of Russian gas. It imports 65% of its gas from Russia, compared to 40% for the EU. An immediate EU ban on Russian gas would therefore have a larger impact on German output on the EU. Germany is known to have a larger manufacturing sector than its EU counterparts. A shortage of gas supply is likely to lower manufacturing output and exacerbate an already disrupted global supply chain.

Question 3: By how much would an immediate EU-wide import ban on Russian gas reduce EU GDP growth per annum in 2022-3, in percentage points (pp), absent other policies?

Answer:
Between 1pp and 3pp
Confidence level:
Confident
Comment:
I expect an immediate and full EU ban on Russian gas to reduce EU GDP by around 3pp. This would likely operate through two channels. First a further rise in commodity prices, which would push up on inflation and down on real income and demand. Second, the ban on energy would create a shortfall between gas demand and gas supply. To manage this the EU has said that it would set quotas on energy use in certain industries. This would reduce output.

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