Today’s International Monetary Fund (IMF) forecast, predicting the UK to be the slowest growing major economy in the world, highlights the vital need to protect the economic benefits of the Protocol and also to build a new and more prosperous Ireland in the long term, SDLP Stormont Leader and Brexit spokesperson Matthew O’Toole MLA has said.
The IMF’s January update to its widely respected World Economic Outlook forecast UK negative economic growth (i.e. contraction) of 0.6 per cent, slower even than Russia – a pariah state which has been sanctioned out of large parts of the global economy.
Higher inflation in the UK is forecast to persist for longer, exacerbated by tighter fiscal and monetary policy imposed by UK policymakers after the disastrous market panic caused by Liz Truss’s mini budget for millionaires last September, but also made necessary by lower UK growth prospects created by radically reduced trade volumes and economic activity post-Brexit.
Several studies, including from NIESR, have indicated that the Protocol has protected Northern Ireland from some of the most damaging impacts of hard Brexit, but its potential has yet to be fully realised due to political instability. Today’s data from the IMF will only further spotlight the damaging effects of Brexit, amplifying not just short-term arguments for the protecting dual market access under the Protocol, but the longer term need to plan a new economic future for the north – consistently the lowest performing part of the UK – back inside in the EU, in a new Ireland.
Matthew O’Toole MLA said:
“Post-Brexit Britain is an unprecedented economic mire, caused by the largest act of self-harm in any modern state in peacetime. For the UK to be contracting while every other major economy grows – including Russia, which is sanctioned out of large parts of the world economy – is a shocking indictment of the hard Brexit forced through by Tories with the connivance of the DUP.
“It is also a tragedy for public services and underpaid workers, which are experiencing the impact of lower growth through less investment and below inflation pay settlements. This grotesque act of self-harm was not the wish of the people of Northern Ireland, but we do have a way to undo some of the worst consequences.
“First, we need to protect economic benefits of the Protocol, which has already been shown to not just protect NI-EU trade, but to offer us a huge and unique selling point: dual market access. But we also need to plan for an entirely new future, back inside the EU. The damage wrought by hard Brexit isn’t simply about trade or growth, it means less investment in the health services, schools and the transition to net zero.
“In Northern Ireland we have a route back into the EU via an inclusive and social democratic new Ireland. With every piece of appalling UK economic data, and every passing day without basic governance in Stormont, delivering that vision becomes more urgent.”