Last Updated: January 27, 2023, 18:35 IST
New economic projections have shown Brexit causing a major, long-term hit to the UK economy. (Reuters Photo)
The Bank of England and the UK government’s own fiscal watchdog, however, believe that the economy has already entered recession on fallout from rampant consumer price inflation
Britain’s finance minister on Friday dismissed “gloom” over its recession-threatened economy and vowed to tap into Brexit opportunities and tackle rampant inflation to boost growth during a cost-of-living crisis.
Jeremy Hunt laid out the Conservative government’s growth plan in London’s City finance district, following recent criticism from the business community — and insisted that the nation was not in decline.
“Declinism about Britain was wrong in the past — and it is wrong today,” Hunt said.
“Some of the gloom is based on statistics that do not reflect the whole picture.”
The Bank of England and the UK government’s own fiscal watchdog, however, believe that the economy has already entered recession on fallout from rampant consumer price inflation.
The finance chief outlined how Britain would benefit from “freedoms” as a result of its exit two years ago from the European Union, after voting to leave in 2016.
“Like every G7 country, our growth was slower in the years after the financial crisis than the years before it. But since 2010, the UK has grown faster than France, Japan and Italy.
“Since the Brexit referendum, we have grown at about the same rate as Germany.”
He added: “If we look further ahead, the case for declinism becomes weaker still. The UK is poised to play a leading role in Europe and across the world in the growth sectors which will define this century.”
Hunt, whose official title is chancellor of the exchequer, will oversee a strategy aimed at boosting poor productivity and focused on key sectors including digital technology, green industries, life sciences, advanced manufacturing and creative industries.
He added that it was necessary to look beyond “short term” business fallout from Brexit, such as border delays, red tape and staff shortages.
“It’s a big change in our economic relations with our closest neighbours, and of course that is going to need adaptation and of course there is some short term disruption,” he noted.
“But I think it is completely wrong to just focus on that without looking at the opportunities.”
Hunt shunned calls to slash taxes from his own lawmakers, arguing that tackling rampant inflation would instead put more cash in Britons’ pockets.
“The best tax cut right now is a cut in inflation,” he told the business audience.
Prime Minister Rishi Sunak wants UK inflation, which is running close to a 40-year peak at 10.5 percent, to be cut by half this year.
It has started cool from a peak of above 11 percent as the Bank of England raises interest rates.
Sunak’s predecessor, Liz Truss, was ousted from Downing Street last year after her tax-slashing budget sparked markets chaos, crashed the pound and prompted emergency BoE intervention to safeguard financial stability.
Hunt added Friday that Sunak’s administration offered a new plan for “long term prosperity”.
“Our plan for growth is a plan built on the freedoms which Brexit provides. It is a plan to raise productivity,” he said.
“It is a plan to use the proceeds of growth to support our public services at home, to support businesses in the new low-carbon economy and to support democracy abroad.
“It is the right course for our country and the role in the world to which we aspire.”
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(This story has not been edited by News18 staff and is published from a syndicated news agency feed)