Military parades, outdoor concerts and a pudding competition: whilst the UK prepares its lavish celebrations of Queen Elizabeth II’s platinum jubilee, marking her 70 years on the throne, her Prime Minister, Boris Johnson, faces a less glorious present. Weakened by the so-called ‘Partygate’ affair (relating to “recreational get-togethers” held at 10 Downing Street during lockdown), the PM has seen his popularity collapse in lockstep with that of Brexit, whose supposed benefits have yet to materialise. One year after the UK’s effective withdrawal from the EU Single Market, the balance of opinions about the country’s new solo adventure has never been so negative (50% of the population believe that it was a bad decision; only 38% think the opposite, with 12% not offering an opinion[1]).
Although the shock of the Covid-19 pandemic makes analysis harder, the costs of Brexit are clear in a number of trends, starting with figures for international trade. Compared to pre-pandemic levels, trade volumes have fallen by far more than in any other advanced economy. Whilst Eurozone trade has pretty much returned to Q4 2019 levels, the UK’s exports of goods and services at constant prices are still down 21%[2]. Unsurprisingly, it has been trade with the European Union, where border formalities have been reintroduced (VAT declarations, sanitary checks and so forth), that has taken the biggest hit.
Nor indeed is inward direct investment what it once was. In anticipation of Brexit, many foreign banks, particularly those from the US, reallocated their portfolios towards the Eurozone[3]. Without completely inverting, net direct investment flows, which the UK traditionally attracted, were cut by eight since the Leave vote in 2016[4]. There is no sign of Mr Johnson’s much vaunted ‘Global Britain’ in the numbers.
Indicators: quarterly changes
