Amid a pandemic which is battering the UK economy and public health, Prime Minister Boris Johnson heaped more misery on the population today with news that the country should “get ready” for the prospect of a ‘no deal’ scenario with the EU on January 1.
Speaking from Downing Street after an EU summit both sides said was the deadline for reaching a trade deal, Johnson said the UK was heading for what he termed “the Australian solution”. The premier claimed that Brussels had “abandoned” the ambition for a Canada-style deal with the UK.
The PM left a glimmer of hope open for a deal with the UK’s biggest export market by adding: “What we’re saying to them is come here, come to us, if there’s some fundamental change of approach.”
The UK left the EU on 31 January this year.
In 2017, international trade secretary Liam Fox claimed that coming to a free trade agreement with the EU should be “one of the easiest in human history.” Johnson himself promised an “oven ready” Brexit deal with the EU on multiple occasions before the 2019 general election.
According to a CNN Business analysis based on forecasts from Citi and the Institute for Fiscal Studies, failing to secure an agreement with the EU could shave more than $25BN off the UK economy in 2021 compared to a scenario where a limited free trade deal is agreed.
The pound fell by a cent against the dollar after Johnson’s statement today, but quickly recovered to trade at just under $1.29.
Meanwhile, much of the UK, including major cities London, Manchester and Liverpool, are returning to tighter lockdown conditions amid a concerted second wave of the coronavirus, which has seen new cases reach more than 18,000 in consecutive days this week and deaths of more than 135.