The Financial Times (FT) and others reported on the 13th (local time) that the UK suffered a 45 trillion won productivity loss after Brexit (withdrawal from the European Union). Analysts say that three years have passed since Brexit in January 2020, and the economic losses suffered by the UK as a result of the drop in corporate investment are becoming evident one after the other.
According to the FT, Jonathan Haskell, monetary policy commissioner at the Bank of England (BOE), the UK’s central bank, said in an interview with the economic media ‘Overshoot’ released on the day, “Compared to surrounding areas. countries, where business investment has increased since Brexit, the UK has The loss in productivity in the country is estimated to be 1.3% of gross domestic product (GDP).” The total loss is 29 billion pounds (about 44.7 trillion won), which is about 1,000 pounds (about 1.54 million won) per household. Professor Haskell said, “The result reflects tangible investments such as cars and intangible investments such as research and development (R&D) and software.
Professor Haskell said, “It is true that production in the UK slowed down around 2016, when the Brexit referendum took place, but private investment was active then. Since then, it has fallen to the bottom among the seven major countries (G7),” he said. On the other hand, foreign media reported that US business investment increased by approximately 24% from 2016 to last year.
Earlier this month, the BOE said, “Assuming that the UK has not left the European Union (EU), trade in goods with foreign countries is estimated to have fallen by around 10 to 15%,” and “a hit of around 3.2 % of GDP.” The International Monetary Fund (IMF) has presented a comment that the UK economy will contract negatively by 0.6% this year, the only one among the G7. It was a bleaker outlook than Russia (0.3% growth), where Western sanctions were intensified after the invasion of Ukraine last year.
In January, a poll showed that 65% of the British people said they should hold a referendum on whether they should rejoin the EU. It is an increase of 10 percentage points compared to the same survey last year, and it seems that the feeling of ‘Bregret (regret for Brexit)’ is spreading. The local media reported that Britons were suffering from living difficulties due to interest rate hikes and real wage cuts by the authorities to curb the annual inflation rate of more than 10 percent. On the 1st, 500,000 people, including teachers, civil servants, and train drivers, staged a massive strike and took to the streets to demand higher wages.