The Foreign Secretary has said it would be “perfectly OK” for Britain to fail to negotiate a trade deal with the EU and crash out of the bloc on the hardest World Trade Organisation terms.
Boris Johnson criticised “apocalyptic” warnings that the approach would spell disaster and said Britain’s “robust economy” would allow it to make trade deals with the rest of the world to compensate.
His comments come after The Independent revealed that Treasury officials believe such an episode would trigger an “economic shock” and have “the most negative long-term impact” on the UK of all the ways of doing Brexit.
George Osborne, the former Chancellor, said this month that such an eventuality would be the “biggest single act of protectionism in the history of United Kingdom” and that “no amount of trade deals with New Zealand” were going to make up for it.
But Mr Johnson appeared undeterred, telling ITV’s Peston on Sunday programme: “I think that actually, as it happens, we would be perfectly OK if we weren’t able to get an agreement, but I’m sure that we will.”
He continued: “I don't think that the consequences of 'no deal' are by any means as apocalyptic as some people like to pretend.
“Actually, I think what you’ve seen in the Budget from Philip Hammond last week are preparations for Britain over the next few years.
“We have a very strong, very robust economy and we have a chance now to do free trade deals… with countries we have not been able to engage with properly for 44 years.”
However Lord Heseltine, former Tory deputy PM told the same programme as Mr Johnson: “That’s rubbish, isn’t it. When I listen to Boris, who I like, actually, he has turned the art of political communication into a science in which waffle, charm, delay, anything to stop answering questions. He does it magnificently.”
Mr Johnson’s Cabinet colleague, International Trade Secretary Liam Fox, this morning said he believed that “you couldn’t have no deal without disadvantaging both UK citizens and European Union citizens”.
The influential House of Commons Foreign Affairs Select Committee warned in a report released on Saturday night that there was little evidence the Government was properly preparing for Brexit.
Speaking on Sunday morning, Brexit Secretary David Davis said Whitehall was now drawing up contingency plans for such an eventuality.
What experts have said about Brexit
What experts have said about Brexit
1/11 Chancellor of the Exchequer Philip Hammond
The Chancellor claims London can still be a world financial hub despite Brexit “One of Britain’s great strengths is the ability to offer and aggregate all of the services the global financial services industry needs” “This has not changed as a result of the EU referendum and I will do everything I can to ensure the City of London retains its position as the world’s leading international financial centre.”
2/11 Yanis Varoufakis
Greece's former finance minister compared the UK relations with the EU bloc with a well-known song by the Eagles: “You can check out any time you like, as the Hotel California song says, but you can't really leave. The proof is Theresa May has not even dared to trigger Article 50. It's like Harrison Ford going into Indiana Jones' castle and the path behind him fragmenting. You can get in, but getting out is not at all clear”
3/11 Michael O’Leary
Ryanair boss says UK will be ‘screwed’ by EU in Brexit trade deals: “I have no faith in the politicians in London going on about how ‘the world will want to trade with us’. The world will want to screw you – that's what happens in trade talks,” he said. “They have no interest in giving the UK a deal on trade”
4/11 Tim Martin
JD Wetherspoon's chairman has said claims that the UK would see serious economic consequences from a Brexit vote were "lurid" and wrong: “We were told it would be Armageddon from the OECD, from the IMF, David Cameron, the chancellor and President Obama who were predicting locusts in the fields and tidal waves in the North Sea"
5/11 Mark Carney
Governor of Bank of England is 'serene' about Bank of England's Brexit stance: “I am absolutely serene about the … judgments made both by the MPC and the FPC”
6/11 Christine Lagarde
IMF chief urges quick Brexit to reduce economic uncertainty: “We want to see clarity sooner rather than later because we think that a lack of clarity feeds uncertainty, which itself undermines investment appetites and decision making”
7/11 Inga Beale
Lloyd’s chief executive says Brexit is a major issue: "Clearly the UK's referendum on its EU membership is a major issue for us to deal with and we are now focusing our attention on having in place the plans that will ensure Lloyd's continues trading across Europe”
8/11 Colm Kelleher
President of US bank Morgan Stanley says City of London ‘will suffer’ as result of the EU referendum: “I do believe, and I said prior to the referendum, that the City of London will suffer as result of Brexit. The issue is how much”
9/11 Richard Branson
Virgin founder believes we've lost a THIRD of our value because of Brexit and cancelled a deal worth 3,000 jobs: We're not any worse than anybody else, but I suspect we've lost a third of our value which is dreadful for people in the workplace.' He continued: "We were about to do a very big deal, we cancelled that deal, that would have involved 3,000 jobs, and that’s happening all over the country"
10/11 Barack Obama
US President believes Britain was wrong to vote to leave the EU: "It is absolutely true that I believed pre-Brexit vote and continue to believe post-Brexit vote that the world benefited enormously from the United Kingdom's participation in the EU. We are fully supportive of a process that is as little disruptive as possible so that people around the world can continue to benefit from economic growth"
11/11 Kristin Forbes
American economist and an external member of the Monetary Policy Committee of the Bank of England argues that the economy had been “less stormy than many expected” following the shock referendum result: “For now…the economy is experiencing some chop, but no tsunami. The adverse winds could quickly pick up – and merit a stronger policy response. But recently they have shifted to a more favourable direction”
“The possibility of ‘no deal’ is real enough to require the Government to plan how to deal with it. But there is no evidence to indicate that this is receiving the consideration it deserves or that serious contingency planning is underway,’ said committee chair and Conservative MP Crispin Blunt.
He added: “The Government has repeatedly said that it will walk away from a ‘bad’ final deal. That makes preparing for ‘no deal’ all the more essential. Such preparation reinforces that stance.”Reuse content