The political pressure is mounting on Boris Johnson’s new un-elected government to avoid the catastrophic consequences of a “no-deal” Brexit. Assurances by the British government that there may yet be a deal with the EU seem unconvincing.
As the UK’s gross domestic product (GDP) fell by 0.2% in the second quarter of 2019, the decline in the UK’s GDP is the first of its kind since the last quarter of 2012 and is worse than original projections of zero growth.
The British government underscored the significance of the global economic slowdown, pointing to expectations that the UK is on course to outperform Germany, Italy, and Japan in terms of annualized growth.
Critics point out that the data released by the UK’s Office for National Statistics (ONS) on Thursday were far worse than originally projected.
Negative growth reflects a slowdown in the manufacturing output, particularly in the auto industry. Construction is also affected.
The Bank of England has warned that at this point the UK is likely to experience a recession regardless of whether the country leaves the EU without a deal or not.
Meanwhile, the pound continues to sink both against the dollar and the euro, not least due to market expectations of an interest-rate cut in January 2020.
The EU has said the withdrawal agreement negotiated by Theresa May will not be re-opened, especially the so-called Irish “backstop,” which aims to keep the border between Ireland and Northern Ireland open.
New Europe / ABC Flash Point EU News 2019.