The Brexit effect: how leaving the EU hit the UK | FT Film
TLDRThe video script discusses the economic and political ramifications of Brexit on the UK. It highlights the lack of a coherent case for Brexit's benefits, the rise in costs and bureaucracy for businesses, and the negative impacts on trade, investment, and prices. The script also touches on the division Brexit has caused within the UK and the lack of a clear Brexit dividend. It emphasizes the economic self-harm aspect of Brexit, the slow puncture effect on the UK economy, and the need for an honest debate about its effects. The speaker criticizes the government's handling of Brexit and the lack of transparency about its implications, suggesting that the UK's decision to leave the EU has led to a less competitive and less productive economy.
Takeaways
- 📉 The 'mini' Budget was seen as a culmination of economic policies since the Brexit vote, leading to a decline in the UK's economic standing.
- 🚫 Post-Brexit, the UK faced significant trade barriers with the EU, with businesses struggling to ship goods due to new regulations and costs.
- 💰 Brexit has had clear negative effects on prices, investment, and trade, which are distinct from the impacts of the pandemic or energy crises.
- 🇪🇺 The UK's decision to leave the EU resulted in the hardest version of Brexit, with no membership in the single market or customs union, leading to increased costs and bureaucracy.
- 📈 The immediate economic cost of Brexit was calculated to be about £870 per household, with inflation rising due to increased import prices.
- 📦 Businesses have experienced increased freight costs and complexities in trade since the UK stopped using the EU's regulatory framework.
- 📉 The UK's trade recovery post-pandemic has been flat compared to other G7 countries, indicating a lag in trade intensity due to Brexit.
- 🏭 Smaller UK companies have seen a drop in trade relationships with their EU counterparts, affecting their growth and expansion opportunities.
- 🤝 The number of business relationships between the UK and the EU fell by about a third in the first six months after the Trade and Cooperation Agreement.
- 💵 Long-term impacts of Brexit include reduced wages, with estimates suggesting a hit of £470 per person, and a shift of economic activity from the UK to the EU.
- 🚫 Non-tariff barriers have effectively put the UK 'behind a wall,' leading to less efficient trade with the EU and a loss of business for UK companies.
Q & A
What was the main idea behind the 'mini' Budget and how does it relate to Brexit?
-The 'mini' Budget was the culmination of economic policies put in place since the Brexit vote, reflecting a particular idea of sovereignty over economic good sense. It signifies an attempt to make Brexit work despite the challenges it has presented to the UK's economy.
How has Brexit impacted the UK's ability to ship goods to the EU?
-Brexit has significantly impacted the UK's ability to ship goods to the EU, with the statement indicating that initially, nothing could be shipped to the EU. This has led to increased costs, bureaucracy, and a decrease in trade.
What has been the political stance on discussing the effects of Brexit?
-There is a political conspiracy of silence around the effects of Brexit, spanning across the government and the Labour Party, with neither side openly discussing the negative impacts it has had on the UK.
What are the immediate economic effects of Brexit that were observed?
-The immediate economic effects of Brexit included a drop in the pound's value by about 10 per cent, making imports more expensive and raising inflation by about 2 to 3 per cent, which made people poorer.
How has Brexit affected the UK's trade intensity compared to other G7 countries?
-After the pandemic, while all other G7 countries experienced a trade recovery, the UK's trade recovery has been flat, indicating that the UK fell behind in its trade intensity due to Brexit.
What has been the impact of Brexit on small businesses and their trade relationships?
-Brexit has led to a drop in the number of trade relationships between smaller UK companies and their foreign counterparts, affecting their growth and expansion into the European single market.
How did Brexit affect the costs and logistics for businesses like Aston Chemicals?
-For businesses like Aston Chemicals, Brexit led to increased freight costs and the need to pay in more expensive sterling for goods costed in dollars. It also caused disruptions in shipping and added layers of bureaucracy.
What was the immediate cost to households as a result of Brexit?
-The immediate cost of Brexit to households was calculated to be about 870 pounds per household, due to increased import prices and the drop in the pound's value.
What has been the impact of Brexit on the UK's ability to attract and retain talent in various sectors?
-Brexit has led to a recruitment crisis in sectors like construction, hospitality, social care, and agriculture, as the end of free movement has made it harder to attract and retain European talent.
How has the Northern Ireland Protocol affected the UK's relationship with the EU?
-The Northern Ireland Protocol, which keeps Northern Ireland in the EU single market for goods, has created tensions and poisoned EU-UK relations, as the UK government has tried to renegotiate its terms.
What are the long-term economic implications of Brexit that have been identified?
-The long-term economic implications of Brexit include a reduction in GDP, lower wages, less productivity, increased bureaucracy for businesses, and a potential shift of business operations outside of the UK.
Outlines
🇬🇧 Economic Aftermath of Brexit
The first paragraph discusses the consequences of Brexit on the UK's economy, highlighting the lack of a clear economic benefit and the rise in costs and trade barriers. It mentions the 'mini' Budget's impact on markets and borrowing costs, the government's struggle to make Brexit work, and the negative effects on prices, investment, and trade. The narrative also touches on the immediate financial hit to households and the increased freight costs for businesses post-Brexit.
📉 Brexit's Impact on Business and Trade
This section delves into the experiences of businesses post-Brexit, emphasizing the increased bureaucracy and the decline in trade relationships. It outlines the shift of business operations from the UK to the EU due to new trade barriers and the challenges faced by small businesses in adapting to new regulations. The narrative also includes personal accounts from business owners who have had to move their operations or face significant losses in the EU market.
💷 Investment Stagnation and Economic Outlook
The third paragraph focuses on the stagnation of business investment in the UK since the Brexit vote and contrasts it with the growth in other G7 countries. It discusses the government's attempts to stimulate investment through incentives like the superdeduction and the broader economic implications of Brexit on the UK's growth forecast. The narrative also addresses the potential long-term dangers for the British economy as smaller companies are deterred from expanding into European markets.
🤝 Northern Ireland Protocol and EU-UK Relations
This part of the script addresses the contentious Northern Ireland Protocol, its effects on EU-UK relations, and the economic benefits it has inadvertently brought to Northern Ireland. It discusses how the protocol has given Northern Ireland a unique trading position within both the UK and EU markets and criticizes the political backlash against it. The narrative also touches on the broader political implications of Brexit and the reluctance of political parties to engage in an honest debate about its economic impact.
🏙️ The City of London and Brexit's Ripple Effects
The fifth paragraph explores the impact of Brexit on the City of London, the UK's financial hub. It discusses the gradual relocation of businesses and the loss of the city's natural advantage for financial business post-Brexit. The narrative also considers the demographic impact of Brexit, particularly on younger generations who voted against it, and their reduced ease of travel and investment within Europe.
🛑 Economic Self-Harm and the Sovereignty Debate
The final paragraph summarizes the economic view of Brexit as an act of self-harm and discusses the broader implications of sovereignty and the UK's new responsibilities. It criticizes the lack of transparency and information provided to the public regarding Brexit's outcomes and the economic costs. The narrative also addresses the political reluctance to acknowledge the negative impacts of Brexit and the need for a more honest and informed debate about the UK's future economic direction.
Mindmap
Keywords
💡Brexit
💡Sovereignty
💡Economic Self-Harm
💡Free Trade Agreement
💡Northern Ireland Protocol
💡Non-tariff Barriers
💡Regulation and Deregulation
💡Customs Union
💡Single Market
💡Inflation
💡Project Fear
Highlights
The 'mini' Budget was the culmination of economic policies put in place since the Brexit vote, prioritizing a particular idea of sovereignty over economic good sense.
Post-Brexit, the UK faced significant trade disruptions, unable to ship goods to the EU.
Brexiteers have not formulated a clear case for how Brexit will deliver economic benefits.
There is a political conspiracy of silence around the effects of Brexit, spanning across government and Labour Party.
The UK's decision to leave the EU is described as an act of economic self-harm, with negative effects on prices, investment, and trade.
The immediate cost of Brexit was calculated to be about £870 per household.
Brexit has increased bureaucracy and caused struggles for small businesses.
The number of trade relationships between UK small businesses and their foreign counterparts has significantly dropped.
The Resolution Foundation calculated that the long run hit to wages will be £470 per person due to Brexit.
Brexit has led to a recruitment crisis in sectors like construction, hospitality, and agriculture.
The Northern Ireland Protocol has given Northern Ireland a unique trading position within both the UK and EU single markets.
Brexit's long-term danger is that smaller UK companies may stop expanding into European markets.
The Office for Budget Responsibility estimates Brexit will cause the UK to be 4% worse off economically.
The notion of a Brexit dividend based on deregulation is seen as creating extra costs and bureaucracy for businesses.
Brexit has led to a reduction in money paid to the UK economy as businesses relocate operations to the EU.
The City of London, a major financial hub, has seen a slow drip of business and people relocating to other places post-Brexit.
The impact of Brexit on the younger generation, who voted against it, includes reduced ease of travel and work within Europe.
Brexit Opportunities Minister role signifies the government's focus on finding benefits in Brexit, although they remain unclear.
The 'Get Brexit Done' slogan was effective but did not address the complexities of post-Brexit arrangements.
Sovereignty from Brexit comes with ownership and responsibility for decisions and outcomes.
Transcripts
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