From now on until Britain has left the EU, CPA are going to post regular blogs for the comments we have seen in the press and elsewhere about Brexit, which is perhaps the most momentous event that will happen to the UK for a very long time and will have long-term implications for every citizen living in this country for good or ill. We aim to be balanced in our reports which will be divided into three categories;
- Category 1 – Positive comments on Brexit
- Category 2 – Negative comments on Brexit
- Category 3 – Neutral comments on Brexit
We posted our first blog on 12th May 2017 (CPA Brexit blog on 12/5/2017)
We posted our second blog on 16th May 2017 (CPA Brexit blog on 16/5/2017)
Please find below our third Brexit blog which has been compiled today on 17th May 2017:-
BREXIT; NEGATIVE COMMENT:
On 12th May in an article by Angela Monaghan in The Guardian headed “Brexit bites as output falls and trade gap grows” she pointed out that “industrial output dropped by 0.5% in March, sharper than the 0.3% fall predicted by economists.” She mentioned that “The National Institute of Economic and Social Research estimates that the pace of economic growth slowed to 0.2% in the three months ending in April, from 0.3% in the three months ending in March.”
The gloomy article ended by saying “A 0.7% fall in construction output in March added to the raft of weaker-than expected data and reinforced fears that the UK economy is facing a renewed slow-down, as uncertainty about Britain’s future outside the UK takes hold.”
BREXIT; POSITIVE COMMENT:
On 15th May in an article by Roger Bootle, under ‘Business Comment’ in The Daily Telegraph, he said that many analysts and commentators, including himself, have for some years been forecasting that an EU country would leave the euro or the whole euro currency union would break up. He pointed out that euro has had a couple of good months and that the Eurozone economy has been picking up well, but that conversely the barriers facing the new French President are considerable and that recent news from Germany has been disappointing.
Also that “Thanks to higher inflation, the European economic environment will become more testing later this year.” He thinks that the Eurozone commentators’ belief that their economy will receive a boost from Brexit by the shifting of money in businesses from the UK is likely to be erroneous and that the effect from people in the Capital will be minor. He believes that there are severe weaknesses in the Italian economy and that without Eurozone reform of the election of a Eurosceptic Government in Rome could all deal the euro a fatal blow.
BREXIT; POSITIVE COMMENT:
On 15th May in an article in by Jillian Ambrose in The Daily Telegraph headed “Growth at a high as cost pressures rise and UK firms drop EU suppliers”, she stated that “Business activity in England grew at its fastest rate so far in 2017 last month, with growth expected to continue into the summer, even as cost pressures accelerate to pre-recession levels.”
She went onto say “The health-check index gives England a score of 57.1 for April, its second highest reading since mid-2015 and well above the 50-point mark which signifies growth.”
BREXIT; NEUTRAL COMMENT:
On 15th May in an article by Jack Maidment in The Telegraph the headline was “Anti-Brexit left line up to create a new party if Corbyn gets humiliated.” Also that it emerged that allies of Tony Blair were drawing up plans for a new party in an effort to combine the forces of anti-Brexit Labour, Liberal Democrat and Green politicians.
BREXIT; POSITIVE COMMENT:
On 15th May in an article in The Daily Telegraph the headline was “Little Brexit impact as student property investment grows.” It stated that Brexit fears appear to have little impact on investment in student accommodation in the UK, with levels increasing by 17% this year, according to Savills, who went onto say “The sector was particularly boosted by international investors, who increased their market share to 64% last year from 35% in 2015.”
BREXIT; NEUTRAL COMMENT:
On 15th May in an article by David Rankin, Director of Insolvency at Creditfix, in The CICM monthly Magazine, he opened by saying “Despite much speculation, nobody really knows what impact Britain’s decision to leave the EU will have on the economy and personal finances. While many are predicting a major upheaval, it is impossible to say whether the country will ultimately be in a stronger or weaker position than before.”
Under the heading of Employment, the article said that whilst government figures show that unemployment is at its lowest since 1975, some (negative) commentators are predicting an economic slow-down once the Brexit negotiations get underway. The Bank of England estimates that as many as 250,000 jobs could be lost in the coming years.
The article further pointed out that a slump in sterling is not necessarily bad news as it could help firms to become more attractive to overseas buyers. There were areas of concern in financial services, particularly in London if there are greater costs in obtaining licences for London from the European Central Bank.
The final paragraph mentioned that until negotiations get underway, there is no knowing how people’s finances will fare, but that so far economists’ predictions that Britain was teetering on the edge of another recession, have proved unfounded and the economy is still continuing to grow.
BREXIT; NEUTRAL COMMENT:
On 16th May in a link from Bloomberg we saw that European Union governments tightened their Brexit negotiation position as they prepare for talks with the U.K. over its departure from the bloc.
The EU toughened its language on a future transitional arrangement that would help companies adapt to Britain’s new status, specified demands on citizens’ rights and clarified the role of European courts, according to the latest draft negotiating directives obtained by Bloomberg News.
Any transitional phase, from the time the U.K. formally exits the EU to the start of a possible trade deal, must be “clearly defined, limited in time and subject to effective enforcement mechanisms,” the draft, dated May 15, said.
The draft directives became public a day after U.K. Brexit Secretary David Davis rejected the EU’s timetable for the talks and warned there would be a “row” over that as well as arguments over the Irish border and the European Court of Justice’s status in post-Brexit Britain. The negotiating mandate forms the basis of the EU’s approach to the talks, which are scheduled to begin after the U.K. general election on June 8.
The original draft of the mandate, published by the EU’s Brexit chief Michel Barnier earlier this month, already reinforced the bloc’s hard-line approach to the talks. Barnier demanded the U.K. “settle its accounts” and accept ECJ oversight.
The latest draft, which has undergone revisions by envoys from the EU’s 27 national governments and is scheduled to be approved by member states on Monday, adds that the ECJ should guarantee the implementation of the Brexit deal. It also emphasises that discussions about future trade in services will not start until there’s been progress on the U.K.’s financial contributions, Ireland and the rights of EU citizens in the U.K. and British nationals living in the EU.
Those citizens should be entitled to rights “which are in the process of being obtained, including the possibility to acquire them under current conditions after the withdrawal date,” according to the latest document.
The document sets out additional details on the rights to be protected, adding those of free movement, equal treatment in health care and access to educational courses for workers’ family members.
Arriving for a meeting, foreign ministers in Brussels on Monday, U.K. Foreign Secretary Boris Johnson echoed Davis’s remarks about the need to talk about a future trade deal at the same time as Britain’s withdrawal. “You would expect all of this to be done as a bundle,” he told reporters. “You’ve got to look at the money, the whole thing, the free-trade arrangement; you have to look at that as a package.”
BREXIT; NEGATIVE COMMENT:
On 16th May published by The Week there was a headline “Unemployment will rise next year, says think-tank, but warnings of a wage squeeze could be bigger problem” and a separate study by the Chartered Institute of Personnel and Development pointed out that there could be a major squeeze for workers, leading the article to say “All of which combines to suggest the economy could face a difficult time over the next year as the UK navigates its path ahead after Brexit” but that “To some degree, however, the unemployment issue is not as bad as it may at first appear”. Also, “At the predicted rate of 2019, the UK would still be well below the EU average for unemployment”.
BREXIT; POSITIVE COMMENT:
On 16th May in an internet blog from Reuters there was a headline that “Smooth Brexit should allow solid UK growth”, Bank of England’s Governor, Mark Carney says. The Bank of England said “Britain should enjoy solid growth if Brexit goes smoothly, but in the short run households are likely to be hit by inflation prompted by the decision to leave the European Union.”
It went onto say The Bank of England said it could “only do so much to offset a Brexit hit to the economy”, and Carney said “the two-year process of leaving the EU did not mean its hands were tied over monetary policy”. Also that “this could mean a rate rise around the time Britain leaves the EU at the end of March 2019”.
BREXIT; POSITIVE COMMENT:
On 16th May in The Daily Mail in an editorial headed “The Last Remoaners” a new poll suggests that just 22% of Britons want to stay in the EU. Even among those who voted ‘Remain’ they are now a minority.
A supporting article on the front page stated that the above figures are far below the 41% polled by the ‘Remain’ last June. By contrast, “68% of voters now want now want the government to deliver Brexit. This includes a solid 45% of voters who backed Brexit”.