During the meeting of the International Monetary Fund, Rachel Reeves pointed to long-term losses resulting from the Brexit 2020 agreement. As reported by the BBC, estimates by the Office for Budget Responsibility (OBR) amount to 4%. GDP. Reeves stressed that the UK must pursue stronger trade links to mitigate these impacts.
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Brexit remains one of the key topics in British politics and economy. Its effects are felt in declining productivity, investment and commercial performance. As the BBC reports, with the November budget approaching, this topic is gaining importance as the government faces the need to introduce new measures. Even tax increases are being taken into account. It is also a signal of a change in the approach of the Labor Party, which has so far avoided open criticism of Brexit.
“The UK productivity challenge has been compounded by the way in which the UK has left the European Union” – said Reeves during a meeting with leading finance ministers and central bankers in the world, and the chancellor's words were quoted by the BBC. She also added that the UK “recognizes” the long-term losses resulting from Brexit and seeks to strengthen trade relations.
Brexit costs the British 4%. GDP. The government is preparing a reset
As reported by the BBC, the Brexit 2020 agreement negotiated by Boris Johnson's government brought significant changes to trade relations with the EU. Economists point to a decline in investment and weakening trade in goods, which has resulted in lower productivity. At the same time, they note that Great Britain has gained new opportunities to conclude trade agreements around the world, which may be an opportunity to improve the situation.
At their conference, the Conservatives pledged to cut public spending by £47 billion a year, which would include, among others: social welfare and foreign aid.
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According to BBC reports, the government is preparing to “reset” relations with the EU, which includes, among others, abolition of some trade controls after Brexit and support for British manufacturers in access to European defense budgets.
At the same time, in the face of the upcoming budget, the government must face the need to introduce new financial resources. The OBR is expected to explain in detail the impact of Brexit on the economy in its forecast.
