(G.N.S) Dt. 22
“As well as this crucial fact, the rest of the world is doing way better than many people would have thought a year ago, so it makes it easier for the UK.”
Britain’s economy, the world’s sixth-biggest, looks set to have slowed only slightly in 2017 when it probably grew around 1.8 percent, according to economists.
Higher inflation caused by the pound’s fall after the Brexit vote has pinched consumer spending power and many firms are wary about what Brexit means for them.
While growth has been less impacted by Brexit than many economists forecast, Britain has grown more slowly than other rich nations.
The Bank of England has forecast growth for the UK of 1.6 percent in 2018, but O’Neill predicted stronger expansion as he expected global GDP growth of at least 4 percent.
A report this month by Cambridge Econometrics, an economics consultancy, suggested Britain’s economy could be as much as 3 percent smaller by 2030 than it would be if Britain left the EU with no transition or trade deal.
“If that’s the worst that Brexit will deliver, then I wouldn’t worry about it,” O’Neill told the BBC in an interview aired on Monday.
“Now, my own view is if we go for a really hard Brexit or a no-deal Brexit, we’ll probably suffer more than that 3 percent.
“But if it is only 3 percent, what’s going on with the rest of the world – helping us – and with productivity improving, that will easily dwarf a 3 percent hit over 13 years, easily.”
He said key sectors such as car production and pharmaceuticals still faced threats because of the government’s plan to leave the customs union and the single market.