The British economy has registered its poorest quarter for growth since it was dragging itself out of the Great Recession in 2012. There is nothing inevitable about this showing. It is true that a great trading economy such as Britain – there is no irony attached to this boast (yet) – will inevitably be affected by the slowdown in international trade, and the outbreak of trade wars, and that this has pushed the reading down.
However, the “uncertainties around Brexit”, as they are euphemistically described, are something the country does not have to labour under, and certainly not without a final democratic say by the people on what should happen next, politically and, thus, economically. As chancellor, Philip Hammond used to like to say that no one in 2016 voted to become poorer – well, now is the moment to prove that once and for all.
These “Brexit uncertainties” have been distorting the figures for some time, in different directions. The car manufacturers brought forward their autumn shutdowns to March and April to cope with the expected chaos, depressing output. On the other hand, government stockpiling and consumer panic buying artificially boosted GDP up in the spring, as the 29 March deadline approached. When it came and went, the effect subsided. Now that the air is full of talk about no-deal Brexit, no doubt retail sales will be boosted, for a time. Much of this will wash out in succeeding months; but there is one element of GDP that is unlikely to recover, and which has shown a consistently dismal showing since the 2016 referendum – investment.
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