Bank of England chief Andrew Bailey calls for EU ties to be ‘rebuilt’ to stop long-term UK decline – as he warns of global trade risks following Trump election win_Nhy
The Bank of England governor has called for the ‘rebuilding’ of ties with the EU as he warned of global trade risks after Donald Trump‘s bombshell election win.
Andrew Bailey insisted the ‘consequences’ of Brexit could not be ignored as he bemoaned the economy’s lacklustre performance since the 2008 Credit Crunch.
In his Mansion House speech last night, Mr Bailey stressed that he had no political position on the decision to leave the bloc.
But he argued that the move had ‘weighed on’ UK plc and urged the government to ‘welcome opportunities to rebuild relations while respecting the decision of the British people’.
Amid fears over Mr Trump’s vow to impose a swathe of trade tariffs on US imports, Mr Bailey expressed concern about the ‘impact of geopolitical shocks and the broader fragmentation of the world economy’.
Chancellor Rachel Reeves echoed the position in her own address to City leaders, underlining Labour’s push for a ‘reset’ with Brussels as they made a seemingly coordinated pitch.
But Ms Reeves and Keir Starmer are facing a delicate balancing act as they try to foster warm relations with Mr Trump at the same time as strengthening ties with the EU.
Andrew Bailey insisted the ‘consequences’ of Brexit could not be ignored as he bemoaned the economy’s lacklustre performance since the 2008 Credit Crunch
Chancellor Rachel Reeves echoed the position in her own address to City leaders, underlining Labour’s push for a ‘reset’ with Brussels as they made a seemingly coordinated pitch
Mr Bailey said during his speech that he takes ‘no position on Brexit per se’.
‘But I do have to point out the consequences,’ he said. ‘The changing trading relationship with the EU has weighed on the level of potential supply.
‘The impact on trade seems to be more in goods than services, that is not particularly surprising to my mind.
‘But it underlines why we must be alert to and welcome opportunities to rebuild relations while respecting the decision of the British people.’
In an apparent nod to uncertainty after the US election, he added: ‘The picture is now clouded by the impact of geopolitical shocks and the broader fragmentation of the world economy.’
Mr Bailey said there was not a ‘good story’ in the UK since 2008, contrasting the performance with that of the US.
Ms Reeves said that alongside beefing up ties with Europe she wanted to improve trade links with the US and China.
She said: ‘We will not be reversing Brexit or re-entering the single market or customs union, but we must reset our relationship.’
Keir Starmer has been looking for ways to bolster ties with the EU, although he insisted Brexit will not be reversed
