Do we need to rethink Brexit’s impact on UK-EU trade?
With the weekend approaching, allow me to furnish you with a classic conversation starter for the pub or a dinner party; have you heard that the OBR might have overstated the impact of Brexit on the UK’s trade with the EU? In my experience this kind of line serves as a perfect icebreaker or an ideal stimulant during a conversational lull. You’re welcome.
The question would go down particularly well should you find yourself seated next to former chancellor Jeremy Hunt, who has penned a foreword to a new report from the Policy Exchange think tank which argues that the UK’s official bodies have indeed been making a series of errors in the way they’ve assessed the impact of Brexit on our trade with the EU.
Contrary to my opening advice in this column, Hunt suggests that “those who seek to relitigate Brexit are deeply mistaken” – and he claims that “neither business nor the population at large would thank the government for reopening these questions.” He does, however, add his weight (as a Remain-supporting Tory) to the think tank’s argument that the models used by the OBR (and others) to calculate the impact of Brexit on UK exports to the EU are fundamentally flawed and the real impact is in fact “only a fraction of what has been assumed.”
Among the small but determined band of militant Remainers who continue to shout online, it’s common to see wild claims and dodgy graphs showing a catastrophic collapse in UK-EU trade, but while nobody disputes the emergence of quite serious friction for some goods, a more granular look at the trade data reveals a much more nuanced picture. It’s vital that organisations such as the OBR put forward accurate data on trade given that ministers and officials will use that information to formulate policy positions – something that is happening right now as the government attempts to ‘reset’ our trading relationship with the bloc.
The foreign secretary will today address an international trade conference hosted by the British Chambers of Commerce, with much of the day devoted to exploring ways to improve UK-EU trade. This is entirely sensible, as long as everyone starts with a clear understanding of how exactly trade has altered since Britain left the EU. So, while Hunt is right that nobody really wants to argue about Brexit anymore, there is still some merit in discussing it and the Policy Exchange report is a good place to start.