U.K. Chancellor of the Exchequer, Rachel Reeves, said the Brexit deal implemented in 2020 had caused long-term damage done to the U.K. economy, in her remarks at a key international economic committee at the International Monetary Fund (IMF).
According to BBC news, in remarks published over the weekend of October 18-19, the chancellor told the world's leading finance ministers and central bankers that the U.K.'s productivity challenge had been “compounded by the way in which the U.K. left the European Union."
She quoted the Office for Budget Responsibility's calculation of a 4% long-term hit compared with remaining in the EU, and said the U.K. "acknowledges this" in seeking stronger trade ties. The issue will play into the U.K.’s budget, which is to be announced on November 26.
The Brexit deal announced in 2020 was negotiated by the Conservative government led by Boris Johnson, although the Labour Party, now in power, agreed a deal to "reset" relations between the U.K. and the EU in May 2025.
BBC says the issue is sensitive right now with the U.K. government deciding on negotiating positions for a Brexit "reset" that includes scrapping most post-Brexit checks on food and farm trade, and helping U.K. manufacturers join consortia to bid for Europe's surging defense budgets.
