So where’s the Brexit chaos? German bank hails UK economy after EU withdrawal

Farage praises ‘big victory for Brexit Britain’

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More than five years after Britons voted for Brexit, critics continue to claim Britain is in a much worse position – economically, politically and socially – than it would be had it chosen to remain in the EU. But a growing number of officials in countries within the bloc are publicly declaring Brexit has done Britain far more good than harm.

An article published in the corporate blog of German bank IKB Deutsche Industriebank on Wednesday highlighted that, despite predictions of post-Brexit chaos, the British economy has not collapsed, investments have proven to be robust and neither corporate nor consumer confidence have noticeably deteriorated.

Dr Klaus Bauknecht, chief economist at IKB, wrote that most of Britain’s current economic woes can be pinned not on Brexit but on the Government’s response to Covid.

Given this, he adds that many of the same problems – for example, a reduction in potential growth – can also be seen in Germany.

Dr Bauknecht wrote that, for the most part, Brexit did not worsen the financial struggles met by the British Government during the Covid pandemic.

He said: “Brexit did not make the [NHS staff shortage] situation worse, as the number of doctors in Great Britain did not decrease between 2016 and 2020.”

Dr Bauknecht also noted: “The slump in GDP a year and a half ago initially seemed to confirm the pessimists.

“But the British economy is now in relatively good shape again – especially compared to the German economy.

“That is why the Bank of England is already considering the first rate hikes, especially since estimates of potential growth support the thesis that the negative consequences of Brexit could remain manageable.

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While some pundits paint a picture of Brexit Britain faring far worse in its efforts against Covid than its European – particularly its EU – counterparts, Dr Bauknecht said “it has now followed a similar course”.

On delivery problems, he added: “The concern that the corona effects, in combination with Brexit, will lead to significantly stronger distortions on the supply side and thus more serious delivery bottlenecks, is currently not reflected in either the actual or expected inflation trend.”

His overall view is that criticism of Britain’s withdrawal from the EU is “much ado about nothing”.

IKB expects that Britain will see a GDP growth of 7.5 percent in 2021 and 5.2 percent in 2022.

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The bank is headquartered in Düsseldorf, Germany’s most populous state.

It also noted that Britain is closer than Germany to returning to its pre-pandemic GDP level.

Earlier this month, the German Bundesrat, which represents the county’s 16 federal states, called on the federal government to make use of the “opportunities offered by Brexit”.

It added that not just Germany but Europe as a whole should “strive for the closest and fairest possible partnership with the United Kingdom in the future”.

Shortly after this, GDP data revealed that Britain’s economic recovery from the costs of locking down is set to outpace that of the eurozone.

And Britain’s economic outlook could improve further still.

Economist Julian Jessop, who describes himself as a “Brexit optimist”, wrote in the Telegraph that “the prospects for the UK are brightening”.

He joked: “And yes, that is ‘despite Brexit’.”

Additional reporting by Monika Pallenberg.

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