Economy

Country likely to leave EU without deal: minister

Country likely to leave EU without deal: minister

Britain is more likely than not to leave the European Union without a deal on trade, the UK's global trade minister warned on Sunday.

Mr Fox told the paper that he had not thought the likelihood of no-deal was higher than 50-50, but the risk had increased.

He said Mr Barnier had dismissed the UK's proposals in the Chequers plan thrashed out by Theresa May and the cabinet simply because "we have never done it before".

The most likely outcome of the Brexit process is leaving without a deal, according to global trade secretary Liam Fox, amid growing concerns of a chaotic departure from the EU.

But Mr Fox, a staunch Leave campaigner in the 2016 referendum, said European Union officials had a "theological obsession" with sticking to rules, which they prioritised over "the economic well-being of the people of Europe".

"It's up to the EU27 to determine whether they want the EU Commission's ideological purity to be maintained at the expense of their real economies", he added.

He said: "If our message on "no deal" is becoming more credible and resonating with those we are negotiating with in Europe, then our negotiating hand is getting stronger every day and we shouldn't do anything to undermine that".

Carney said consumer prices were likely to rise in the case of a no-deal Brexit as companies enacted contingency plans to keep supply chains operating.

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But he said that the United Kingdom financial system was robust and could withstand any post-Brexit shocks.

On Friday, Bank of England Governor Mark Carney was described as the "high priest of project fear" after he warned the prospect of a future trading deal between Britain and the European Union was uncomfortably high.

But unlike Mr Fox, Ms Patel does not back the Chequers deal, which has already led to a number of resignations from the government - including David Davis as Brexit secretary and Boris Johnson as foreign secretary.

Mr Rees-Mogg said: "Mark Carney has always been the high priest of Project Fear, whose reputation for inaccurate and politically motivated forecasting has damaged the reputation of the Bank of England".

One cabinet source said: "We've been telling business for two years that no deal isn't going to happen, and we still believe that it's a very small chance, but it's not a 0% chance so government has got to prepare".

"[It will be] the worst of both worlds - effectively out of Europe but still run by Europe".

Supporters of Brexit say there may be some short-term pain for Britain's $2.9 trillion economy, but that long-term it will prosper when cut free from the EU, which some of them cast as a failing German-dominated experiment in European integration.