Chancellor confirms Brexit hit overseas trade

The Chancellor of the Exchequer Rishi Sunak confirmed when giving evidence to a Commons Treasury Committee on Monday March 28^th, that Brexit has hit overseas trade.

Sunak in confirming the hit said it was “inevitable” that UK trade with the EU would fall as a result of Brexit, adding that it was too early for the benefits of trade deals struck since to kick in.

He was challenged by Committee Chairperson, Tory MP Mel Stride, about new figures from the Office for Budget Responsibility (OBR), showing that while other countries’ “trade intensity” had come back “quite strongly” since Brexit and the pandemic, the UK’s had not.

Sunak replied saying that it was always inevitable that there would be a change in our trade intensity with Europe as a result of the change in the relationship.

Stride again challenged him saying: “Doesn’t that tell you that the main distinction between ourselves and them is that we went through Brexit and they didn’t?

Disagreeing with the chairperson, Sunak commented that it was too soon to disentangle Brexit from the Pandemic, before acknowledging that leaving the bloc had had a negative impact.

He went on to say: “We are still trying to work through what all the impacts are,” he said.

“It was always inevitable that there would be a change in our trade intensity with Europe as a result of the change in the trade relationship.

“Without doubt we are changing our trading relationship with the EU and that means a different set of controls and things people will have to do and that will obviously have an impact.

“That is, I am sure, a big part of the reason why this is happening. I think it is maybe a bit early to be definitive about which bits are doing what.”

Sunak was also challenged with allegations that the UK was becoming “a more closed economy”, to which he replied the intention of the government was to be open to world trade:

He said: “The benefit of new trading relationships takes time. They don’t happen all over night. Of course, that will happen over a period of time.”

The Chancellor is the most senior minister to confirm that Brexit had hit overseas trade, providing a more realistic view on the situation.

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