Brexit places a strain on the British economy
Since the Brexit took effect in January 2021, the British economy has been facing headwinds.
More complicated import-export procedures, VAT and customs fees have stalled trade with the continent causing a decline in the pound and a reluctance of foreign investors to locate in the UK.
In order to determine the impact of the Brexit on the British economy, the Centre for European Reform compared the UK's statistics with those of a group of twenty-two developed countries. According to the study, the British economy has not collapsed. However, it has gradually lost its luster and since the referendum of 23 June 2016:
- country growth: -5.2% compared to selected countries,
- investments: -13,7%,
- trade in goods: -13.6,
- services: -7.9%.
Other sources agree with the Centre for European Reform's findings. The Office for Budget Responsibility (OBR), a non-departmental public body charged with providing independent economic forecasts and analysis, predicts a loss of 4 percentage points of GDP in the ten years following the Brexit.
The Office for National Statistics (ONS) estimates that the new post-Brexit trade rules will lead to a decline in investment and trade, a drop in the sterling exchange rate and a drop in income of about 470 GBP (574 USD) per person over the next decade.
