In their mission for growth, the Labour Government is currently starting at an open goal with closer EU alignment on the table. But, rather than putting the ball in the back of the net, it appears they’re doing kick-ups on the goal-line.
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Will the UK seek closer EU alignment? It makes financial sense
Keir Starmer and his colleagues have insisted they won’t move to undo Brexit, stubbornly sticking to their so-called ‘red lines’. However, new research from Frontier Economics (and commissioned by Best for Britain) shows the UK a possible way forward.
Their data considers the impact of a ‘deep EU alignment’, where Britain would agree to a much closer trading relationship in goods and services, without having to rejoin the single market or customs union. The projections are something to behold.
What would a ‘deep EU alignment’ mean for Britain?
As per the financial experts, the UK would even stand to benefit more than our continental neighbours. It’s estimated that an economic boost of $32.9bn – or roughly £26.5bn – could boost the country’s GDP by more than 2%.
Andrew Lewin, chair of the UK Trade and Business Commission and serving Labour MP, told LBC on Sunday morning that the government ‘are looking’ at these numbers – which would help deliver a huge boost in the search for economic growth:
“Deep alignment in goods and services benefits all aspects of trade for the UK and the EU, with the relative effect being stronger for the UK. Once again, in monetary terms, the economic benefit for both the UK ($32.9bn) and EU ($29.7bn) are roughly equal.”
“This has the potential to grow the UK’s GDP by up to 2.2%, recovering around half of the OBR’s estimated 4% hit to UK GDP as a result of Brexit and the subsequent losses to trade incurred by moving from EU membership to the TCA.” | Frontier Economics
Undoing the damage of Brexit, without undoing Brexit, could be possible…
To many, this appears to be a common sense policy. According to Frontier Ecomonics, this move would also have an immediate benefit for regions across the UK – helping to level-up regions that have recently been shafted by the reality of Brexit.
“Deep alignment in goods regulation reduces trade costs affecting goods, and therefore has a particular benefit to regions that are intensive in goods exports. For all regions, the alignment scenarios help to at least offset – or even dominate – the effects of tariffs.”
“We see particular strong shielding effects in the Midlands, North East, Yorkshire, Scotland, Wales and Northern Ireland. Regulatory alignment in services, by reducing trade costs, can also have a beneficial impact on goods trade.” | Frontier Economics