Carney In No Deal Warning
It is shocking to anybody who has looked into the consequences of a “no deal, no transition” exit from the EU, or read any of the official governmental papers that anybody could embrace “no deal” as a desirable and innocuous conclusion to Brexit. However, some politicians and activists are actively championing such a scenario. They are simply not prepared to believe that mandatory checks on freight (notably livestock and fresh food) would cause massive delays on roads into Dover and that EU points of entry would just “wave through” UK shipments. They seem to think that WTO rules relating to customs and tariffs are somehow optional and that we will simply “muddle through”.
In an interview with Sky News yesterday, the Governor of the Bank of England, Mark Carney, was pulling no punches on the risk of a “no deal” exit from the EU. He said that the risk of a “disorderly” Brexit was now “alarmingly high”. Whilst acknowledging that “real progress” had been made on contingency plans for a “no deal” exit he noted that there were still “lots of things to worry about”, he derided the idea that such a situation could be easily managed as “absolute nonsense”.
Speaking of the current political situation, Carney said: "We're in a situation where the expressed will of Parliament is for some form of deal, so to put it in the double negative - Parliament is against no deal, the government, as expressed by the prime minister, is against no deal, the European Union is against no deal, and yet it is a possibility, it is the default option. So no deal would happen by accident, it would happen suddenly, there would be no transition - it is an accidental disorderly Brexit."
Carney was equally dismissive of Brexiters who claim that the UK would be able to enjoy free trade with the EU under GATT Article 24 which suggests such an arrangement might be possible whilst negotiations are taking place: "Forget the fiction, it's absolute nonsense. It needs to be called out. I might point out that they want to become better acquainted with the Secretary of State for Trade [Liam Fox] who in Parliament has made the point that it cannot apply unless both parties agree, and unless you're moving towards a - guess what - a customs union."
The one area in which Carney was upbeat should a disorderly exit occur was financial services. "There are a lot of things to worry about in the event of a no-deal Brexit, but the financial sector is not one of them," he said.
Developments in the Commons yesterday may make the potential for a “no deal” much less likely as a bill (legislation) put forward by Labour MP Yvette Cooper squeaked home with a majority of just one vote. More on this later.