Liam Fox dismisses Chancellor’s warnings on no-deal Brexit


International Trade Secretary Liam Fox has dismissed warnings from Cabinet colleague Philip Hammond over the long-term impacts of a no-deal Brexit.

Dr Fox, who is in Singapore touting UK trade opportunities to Asian governments and businesses, said the Chancellor’s warning that GDP could fall and borrowing could be around £80 billion a year higher by 2033/34 if Britain resorted to WTO terms was “hard to swallow”.

His comments came after Theresa May poured cold water on the warning — stating that no agreement with the EU “would not be a walk in the park” but “wouldn’t be the end of the world”.

Dr Fox, speaking to the BBC, said: “Some of us remember the supposed economic shock we were going to get if Britain voted to leave the European Union and the result of the referendum itself was going to cost us half a million jobs, it was going to see investors desert the UK and our economy plunge into recession.

“What has in fact happened: We’ve added 600,000 jobs to the economy, we saw a record number of inward investment projects land in the UK last year and our economy has continued to grow.”

He added: “That was over a two-year time horizon, so projections over a 15-year time horizon are rather hard to swallow.”

The Chancellor was accused by Tory backbenchers of launching another “project fear” by referring to disputed provisional analysis which claimed GDP could fall and borrowing could be around £80 billion a year higher by 2033/34 if Britain resorted to WTO terms.

Mr Hammond said such an impact on GDP would have “large fiscal consequences”.

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He also said this analysis was undergoing a “process of refinement” ahead of a parliamentary vote on any deal.

Mrs May, asked about the timing and content of Mr Hammond’s intervention, said she had previously labelled the data as a work in progress.

Speaking to reporters on her trade mission to Africa, the PM added: “Look at what the director of the World Trade Organisation has said.

“He said about a no-deal situation that it would not be a walk in the park, but it wouldn’t be the end of the world.

“What the Government is doing is putting in place the preparations such that if we’re in that situation we can make a success of it, just as we will make a success of the good deal I believe we’re able to get and the good deal we’re working to get.”

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Mrs May was also challenged on whether she would order her MPs to vote for no deal if her preferred approach – agreed following talks at Chequers – was not secured with the EU.

She replied: “I’ve said right from the beginning that no deal is better than a bad deal.

“I think it’s absolutely right that the Government is putting the preparations in place for no deal, because we don’t know what the outcome of this is going to be.

“But alongside that what we’re doing is working for a good deal.

“I believe what we’ve set out in the Chequers arrangement, set out in the white paper, is a deal that benefits not just the United Kingdom but benefits the European Union as well.”

Eurosceptic Tories have criticised the Government’s proposals, which include a “common rulebook” with the EU on goods, amid fears it could restrict the UK’s ability to do trade deals.

Mrs May also said the UK was working to secure a deal by October and within a timetable which meant Brexit could occur in March 2019.

On whether Tory MPs face a backlash from their local party associations for supporting a second EU referendum, Mrs May added: “I believe that what matters to local associations is what the Conservative Government is delivering for them – and what we’re delivering is what the people voted for.”

Mrs May also reiterated the UK Government’s desire to end free movement is “non-negotiable”.


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