UK must stop talking itself down, says Badenoch as report shows Brexit hasn’t hurt trade
Business and trade secretary Kemi Badenoch will say today that the UK needs to stop talking itself down after a new report argued Brexit hasn’t damaged UK-EU trade to the extent some might have feared.
The report by the Institute for Economic Affairs (IEA) said that contrary to initial concerns, Brexit has not had a detrimental impact on UK–EU trade.
“Trade data doesn’t support the Office for Budget Responsibility (OBR’s) claims that Brexit has caused significant negative impacts on the UK economy,” economist Catherine McBride argued in the new paper.
Badenoch, who is expected to speak at the launch of International Trade Week in London today, is set to describe the IEA review as “excellent” and say: “This is why I just don’t agree with the narrative that Brexit has ‘severely damaged’ our economy.”
She will add: “We should stop talking ourselves down, and instead talk ourselves up.”
IEA research claims that trade grew between 2016 and 2020, while UK goods exports rose 13.5 per cent to EU nations and 14.3 per cent to non-EU countries between 2019 and 2022.
UK services exports rose by 14.8 per cent to EU countries and 22.1 per cent to non-EU countries over the same period, and the IEA says this is due to varying demand levels, and that UK trade patterns compared to other G7 countries have not changed since Brexit.
This runs counter to the OBR’s latest figures. As of April 2023, they forecast that post-Brexit trade “will reduce long-run productivity by four per cent relative to remaining in the EU”.
But Catherine McBride pushed back.
“A false narrative that Brexit has harmed UK trade is now firmly entrenched in the British public psyche, but this just isn’t true,” she said. “The vast majority of UK and EU trade is conducted by multinational companies who manage to sell goods all over the world… but the UK media somehow assumes these companies are too stupid to cope with some additional EU paperwork.”