We all know that Britain’s foreign owned tabloids have a lot to answer for when creating an atmosphere of fear and hate against the EU and foreign immigrants. We also know the same papers love to downplay any good economic news emanating from the Eurozone, while at the same time creating an illusion the economic prowess of the UK is unrivalled, certainly compared to other G7 economies. But an Express article by Brexit bimbo @katiemansfield_on July 5th really takes the biscuit with the following headline:
“Britain’s economy to outperform France, Germany and Eurozone, says bombshell report”
Having just read that ONS for the second time had to downgrade UK GDP Growth recorded for the first quarter of 2017 from 0.3% to 0.2% growth, naturally I was surprised. On that basis the annual growth rate for Brexit Britain would amount to just 0.8%, hardly something to write home about.
On the other hand is was widely reported, that the Eurozone Economy seems to be powering ahead. On a similar annual basis, CNN Money reported that the eurozone grew by 1.7% or more than twice as fast than the UK!
I am quite used to rags like the Express not actually providing HTML links to the reports their shoddy reporters claim to have read. Certainly the providers of the report ‘Oxford Economics’ make no mention of the report on their web site. On the contrary, all I could find is older bad brexit news stories! So contacted their service help desk and they kindly provided me with copies and a link where the Daily Express quoted report can be downloaded from. See that wasn’t so hard to do was it Katie? Now some actual quotes rather than Katies fanciful imagination:
The impact of Brexit on Trade
“Since Brexit the UK economy has slowed, with a sharp weakening in the first quarter of 2017. The preliminary estimate of UK GDP growth of just 0.3% was significantly below the 0.7% achieved at the end of 2016 [ML: and was since then further revised downwards to 0.2% by ONS]”
Here it should be noted that the report quoted by the Express makes an assumption that the UK would leave the EU in early 2019 and that this is followed by a three year transitional arrangement followed by a comprehensive Free Trade Agreement (FTA) with the EU. Those who follow the brexit news know that this ‘soft brexit’ scenario is far from certain as we speak. Over the alternative ‘hard brexit’ scenario that most Express readers lust after the report says:
“This would be a economically damaging outcome and would mean our forecasts are far too optimistic……….The increase in trading costs that would result would lead to a degree of Trade destruction.”
“On balance our baseline forecast shows slower growth in both exports and imports as a result of Brexit with the slower exports causing, and the slower imports caused by, slower GDP growth than would otherwise have occurred.”
UK economic performance over the next decade (after Brexit)
Are you still with me dear reader? So far we have seen optimistic assumptions and pessimistic outcomes predicted for Brexit. Now we come to the bit that poor old Katie tries to sell you as “bombshell good brexit news”. IF ( and it’s a big if) David Davis MP manages to negotiate that elusive Free Trade Deal with Europe and the much more sensible Chancellor Philip Hammond and the CBI get their three year transitional brexit period, than maybe, maybe the following report prediction might come true….
“We forecast an average increase in UK GVA of 1.9% a year in the period 2018–27. This means that the UK will grow more slowly over the next decade than in the period leading up to the financial crisis, but will continue to outperform many of its peers, including those in the Eurozone”
I’ll let that sink in: The UK will grow more slowly out of the EU! and if (and it’s a big if based on unsafe assumptions) the UK grows 1.9% a year after brexit it might outperform the dreaded Eurozone. Only we’ve just seen that the Eurozone is already growing at 1.7% and we’re still in the doldrums with just 0.8% growth.
Conclusion: More unsubstantiated Express UK bullshit…. Shame on you Katie Mansfield! Like me more discerning readers of the Oxford Economics report clearly must come to the conclusion you haven’t actually read the report you write about?
Eurozone recovery is the real bombshell surprise economic story of 2017!
Read more about this in the FT here