AS evidence of the relentless economic damage to Scotland and the rest of the UK from Brexit has kept on piling up this week, providing a whole heap of room for dismay, there was a welcome glimmer of hope.
The hope, of course, is nothing to do with the fantastical, ideological dreams of the arch-Brexiters, with their misconceptions of the UK’s place in today’s world and the country’s future prospects in the wake of their longed-for exit from the European Union.
It has been somewhat demoralising to see Nigel Farage return to the fray with the launch of his Brexit Party. True to form, in terms of his typically populist moves to woo sections of the electorate which seemingly prefer soundbites that they can repeat to detailed analysis, has placed a bet on the Brexit Party dominating the European Parliament elections next month. You would dearly hope the UK electorate might yet ignore this gimmickry, and focus on the serious issues. Then again, given many voters’ apparent appetite for the Brexiters’ bluster back in the summer of 2016, and splits within the Conservatives and Labour over the EU, we should perhaps not be surprised opportunity-spotter Mr Farage appears to be appealing once again to the UK’s Leave die-hards.
Given these latest dismal political developments, the glimmer of hope offered by European Council President Donald Tusk certainly lifted the spirits.
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Mr Tusk, briefing the European Parliament in Strasbourg on Tuesday on last week’s EU summit at which the floundering Prime Minister was granted a delay of Brexit until October 31, called for the dream that the UK might give up on leaving the EU not to be dismissed.
He continues to demonstrate a degree of patience that is perhaps surprising, given how difficult the deeply divided Conservative Government must have been to deal with for our long-suffering EU neighbours. It is almost impossible to tell where things will go from here but it is heartening indeed to see Mr Tusk take such an approach. And the UK public, whatever Mr Farage, other arch-Brexiters and the Leave-supporting media might tell them, should be thankful for this patience.
After all, it is ordinary people’s living standards that will be influenced by what happens on the Brexit front. And the ultimate cost to households will make the £1,000 bet placed by Mr Farage on Brexit Party success look like chicken-feed.
While significant economic damage has been done already by the Brexit vote, even before the UK reaches the exit door, it is still possible that a further heavy toll on households and businesses across the country can be avoided if this whole folly is ultimately abandoned. And such a possibility has to be kept alive by the EU giving the UK chance after chance to do the sensible thing, as all that evidence of the consequences of Brexit continues to pile up.
Mr Tusk told the European Parliament he was responding to one national leader in the EU who had warned “dreamers” not to think “Brexit could be reversed”.
He declared: “At this rather difficult moment in our history, we need dreamers and dreams. We cannot give in to fatalism. At least I will not stop dreaming about a better and united Europe.”
The UK certainly finds itself in a difficult place. The country is in a political crisis, albeit this is at the current juncture a good thing given it presents a chance to abandon what is, to be clear, a hard-Brexit path being pursued utterly pitilessly by Theresa May. And UK growth, already hit hard by the Tories' ongoing savage austerity programme, has all but ground to a halt as Brexit uncertainty has hammered business investment and made households worried about making big purchases.
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The University of Strathclyde’s Fraser of Allander Institute warned this week that the risks to the Scottish economy from Brexit “remain high”, with the danger of recession persisting and the delay in the UK’s departure providing welcome but only temporary respite.
What is surely doubly frustrating for the Scottish electorate is that it voted decisively to stay in the EU, yet has to pay the price for the ill-judged UK-wide Brexit call.
In its worst-case scenario of a no-deal Brexit with no policy response from the UK Government or Bank of England, Fraser of Allander projects a deep recession with a peak-to-trough fall in Scottish gross domestic product of 5.5 per cent. With a “maximum” policy response to a no-deal scenario, it projects a 1.9% peak-to-trough fall.
Its central forecast, based on an “orderly departure at some point in 2019”, is that the Scottish economy will grow by 1.1% in 2019, 1.4% next year, and 1.5% in 2021. These growth rates are way below Scotland’s long-term average annual growth rate.
A Scottish Chambers of Commerce survey published this week shows companies north of the Border are facing major recruitment difficulties and remain wary of investing.
Tim Allan, president of Scottish Chambers, warned: “There is an immediate urgency to deal with Brexit, which is hampering our ability to compete on the international stage. We see this borne out in the decline in confidence, difficulties in recruitment and challenges in exporting.”
This is the reality of the situation. And it is notable how starkly this picture contrasts with that painted for the electorate in 2016 by the Leave camp, which would have had us believe the EU was holding back mighty Blighty on the world stage.
The Brexiters promised a brave new world of big trade deals. However, lots of glad-handing by the UK Government has still, about three years on, failed to produce any signs that anyone is going to be signing a major trade deal with Britain any time soon. Even with the fall in sterling in the wake of the June 2016 referendum, reflecting the UK’s diminished economic prospects, exporters have struggled badly as Brexit has weighed heavily. Sterling weakness has meanwhile led to a surge in companies’ costs.
Mr Tusk’s dream makes for a good antidote to the utter nightmare brought upon us by former prime minister David Cameron’s decision to hold a referendum on EU membership and the Brexiters’ temptation of the UK electorate to vote Leave (and continued by Mr Farage et al).
Hopefully, in coming months, more and more people will wake up to the reality of the situation before much greater damage is done.
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