By Ian McConnell
Business Editor
FORMER Brexit minister Lord Frost claimed in a speech yesterday that Brexit “is working”.
He also declared, at UK in a Changing Europe’s The World Beyond Brexit conference in London, that the view Brexit is damaging the UK economy and trade “cannot be supported by any objective analysis of the figures”.
UK in a Changing Europe is a UK-wide network of academics and researchers coordinated from King’s College London, and its conference yesterday was six years to the day since the referendum on Brexit.
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Lord Frost said: “Is Brexit working? That’s my exam question. And I’ll cut to the chase and probably not surprise any of you by saying up front that I think it is working. I don’t think we have any cause for regret about the decision the country has taken and the solutions to the remaining problems that we have are not to be found in going backwards but they’re to be found in completing the process and following through on this logic.”
He added: “The view that Brexit is hitting us from an economic and trade perspective is in my view generated by those with a bit of an axe to grind on this subject and cannot be supported by any objective analysis of the figures.”
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Lord Frost, who was as chief Brexit negotiator one of the leading architects of the UK’s departure from the European Union and the single market and customs union, declared yesterday that Brexit was fundamentally “about democracy”.
The Organisation for Economic Cooperation and Development forecast earlier this month that the UK will next year stagnate and be the worst-performing economy among the Group of Seven leading industrialised nations by a significant margin.
In its latest economic and fiscal outlook, published in March, the independent Office for Budget Responsibility says: “With little evidence to suggest that we revise our assumption about the negative effect of Brexit on UK trade flows, we continue to forecast little growth in export and import volumes and a fall in the trade intensity of the economy over the medium term.
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“The financial crisis, Brexit and the pandemic are all expected to have long-term consequences for potential output.”
The comparison with other G7 countries is stark.
The OBR observes: “Comparing our recent overall trade performance with other advanced economies suggests that the UK saw a similar collapse in exports as other countries at the start of the pandemic but has since missed out on much of the recovery in global trade. UK and aggregate advanced economy goods export volumes fell by around 20 per cent during the initial wave of the pandemic in 2020. But by the fourth quarter of 2021 total advanced economy trade volumes had rebounded to 3% above their pre-pandemic levels while UK exports remain around 12% below. The UK therefore appears to have become a less trade intensive economy, with trade as a share of GDP (gross domestic product) falling 12% since 2019, two and a half times more than in any other G7 country.”
It adds: “Our forecast continues to assume that leaving the EU will result in the UK’s total imports and exports being 15% lower than had the UK remained a member state...We assume productivity is ultimately 4% lower after a 15-year period.”
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