Global Britain, November 7, Catherine McBride
THE OBR (Office for Budget Responsibility) published its annual report evaluating its fiscal forecasting record last month. The report doesn’t mention Brexit specifically but does admit that:
‘Net trade was less of a drag on growth than expected across both the March 2021 and March 2022 forecasts, respectively contributing 1.0 and 1.5 percentage points more to GDP growth than forecast. This is partly due to stronger-than-expected export growth.’
So, will the OBR still stick with its forecast that Brexit would cause UK trade to be 15% lower than if we had remained in the EU?
The UK’s trade data certainly doesn’t show such a decline – thankfully for us all, however we may have voted. And the changes that do exist are certainly not due to Brexit. There was a massive fall in trade with all countries during Covid and a massive increase in oil and gas imports from non-EU countries since Russia invaded Ukraine. Neither was caused by Brexit. For most industries, UK trade with both EU and non-EU countries has been very similar since the UK left the EU.
But as Brexit could only possibly alter trade with the EU, which only makes up 42% of total UK trade, then for total UK trade to fall by 15% the OBR must still be expecting UK trade with the EU to fall by 36%. This doesn’t look likely.
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