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London 'draining life' from rest of UK economy

By DANICA KIRKA

LONDON (AP) a¿¿ There's London. And then there's the rest of the country.

A tale of two Britains has increasingly emerged since the Great Recession. While the government trumpets the country's recovery from the financial crisis and its status as the world's fastest-growing developed economy, the rhetoric hides an increasing divide: One that pits London's boom against the malaise in cities such as Manchester and Birmingham that are struggling to remain vibrant in the 21st century.

Buoyed by foreign investment and a resurgent financial industry, the economy of London and the rest of Britain's South East region has expanded almost twice as fast as the rest of the country since the 2008 financial crisis. A chasm that began opening with the decline of Britain's textile and coal industries a century ago is widening as London's ability to attract jobs and investment leaves the rest of the country struggling.

Britain's economy is, by some calculations, the most dependent on a single urban area among the world's most industrialized nations.

"It's almost the definition of polarization," said Danny Dorling, a professor of geography at Oxford University. "It's pulling apart in a quite dramatic way."

Policymakers are considering a range of ideas to address the imbalance. Among them is building a 43 billion-pound ($71 billion) high-speed rail network to connect London with Birmingham, Manchester and Leeds, helping the northern cities become viable alternatives for businesses to locate. Another idea is for Manchester and Liverpool to merge into a super-city that could better compete with London for investment.

The issue of economic inequality a¿¿ how to get more people to share the fruits of the recovery a¿¿ is of growing concern for governments around the world.

It is also central to the political fortunes of Prime Minister David Cameron, whose Conservatives are trying to broaden their base into traditional Labour Party strongholds outside southeastern Britain in hopes of winning next year's election. The Conservatives were forced to form a coalition with the Liberal Democrats after failing to win a majority four years ago after 13 years of Labour governments.

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