Bank of England governor warns no-deal Brexit would cost more than COVID-19

Bank of England Goverr Andrew Bailey recently warned that ecomic cost of a -deal Brexit would be bigger in long term than dam caused by unprecedented coronavirus pandemic. While responding to a question from a lawmaker on what would happen if UK government does t complete a deal before December 31 deline, Bailey said that he thinks “long-term effects would be greater than long term effects of COVID”. He ded that, however, it would be better to have a tre deal and re is “ question about it”. 

As Brexit transition expires at end of December, Bailey said that failure to agree to a deal would cause disruption to cross-border tre and dam goodwill between London and Brussels needed to build a future ecomic partnership. Speaking to MPs on Commons Treasury committee, he ded that it takes a much longer period of time for what he calls “real side of ecomy” to just to change in openness and to change in profile in tre. 

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Previously UK chancellor Rishi Sunak said that Britain should t accept a deal with EU at any price, insisting that virus outbreak posed a much greater threat to ecomy that a -deal scenario. However, Bailey on vember 23 said that it was in “best interest of both sides” for re to be a tre agreement. 

Brexit negotiation 

Meanwhile, with little more than a month before transition period ends, a tre deal between London and Brussels is close to being finalised. However, officials have repeatedly warned that risk remains of an accidental deal if compromises cant be reached. negotiators have been trying to hammer out a deal that will allow for tariff-free tre to continue. But as progress has been slow, chief EU negotiator Michel Barnier warned that “fundamental differences” still need to be resolved. 

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UK business groups, on or hand, have been pushing PM Boris Johnson to secure a deal, saying that several companies have been stretched to breaking point by pandemic and ar round of lockdowns. Without EU deal, Britain-based firms face hefty tariffs, quotas and or barriers to doing business with country’s biggest export market starting on January 1. 

United Kingdom wants to take back control of its water, however, European Union is seeking access as most of its ships fish in English waters 89-90 per cent of time. But negotiations have hit a speed-breaker because UK sells majority of its fish exports to EU and bloc is threatening to impose tariffs if it doesn't allow its vessels to fish in English waters. It is said that British Prime Minister Boris Johnson is amant on a "better deal" for United Kingdom, even though it means a -deal outcome.  

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