Analysis commissioned by The Independent has discovered that the combined benefit of all the new trade deals signed in the wake of Brexit ‘barely scratch the surface’ compared to the economic damage caused by leaving the EU.
The boost from new deals, notably those with Australia and New Zealand, amounts to just 0.01-0.02 of GDP – or less than 50p per person.
However, data from the Office for Budget Responsibility shows that the damage caused by leaving the single market is worth more than £1,250 per person.
The Independent reports that the majority of new FTAs signed by the UK government, including those with Singapore and South Korea, are merely replacing treaties that the UK had already previously enjoyed as a member state.
However, a spokesperson from the Department for International Trade commented on the new report that: “Our Global Trade Outlook – published in September – shows the centre of gravity on global trade is moving away from Europe and towards fast-growing markets in Asia-Pacific.
“Our strategy is latching the UK economy to these markets of tomorrow, and seizing the huge economic opportunities as an agile, independent trading nation.”
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However, academics from the UK Trade Policy Observatory noted that any new trade deals the UK signs would never conceivably cover the economic losses of Brexit.
They noted that: “Non-EU partners account for about half of UK total trade and so, to counteract the OBR’s 4 per cent loss from Brexit, would require agreements with each and every one of them to induce trade changes that create a 4 per cent increment to UK GDP. That is nowhere in sight in the numbers in the table.
“The sad answer is that the government is happy to accept, on our behalf, the economic losses from Brexit in return for political benefits (sovereignty), and trade agreements with other countries are merely making the best of a bad job from an economic perspective.”