Scrap UK tariffs on imports and give the UK a four per cent boost in GDP say Brexit-backing wonks
Scrapping all tariffs on imports into the UK would add as much as four per cent to GDP after Brexit, a group of economists has claimed.
A cabal of Brexit-supporting academics argue that the end of all import tariffs would cut prices in the UK and improve both productivity and competition in the UK.
The newly re-branded Economists for Fair Trade, led by Cardiff Business School professor Patrick Minford, argue the UK should drop charges on goods, regardless of negotiations with the EU.
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Minford said: “Any strategy that involves the UK putting up tariffs against the EU will cause significant self-harm, which is entirely avoidable.
“Our analysis shows that embracing global free trade, even if the EU does not reciprocate, will mean the UK is far better off compared to the status quo.”
Chancellor Philip Hammond has already voiced disapproval for the unilateral approach, telling the Treasury Committee in mid-December that it would represent the UK giving up bargaining chips when it comes to lowering trade barriers for British goods going to other countries, despite conceding the hypothetical appeal of such an approach.
“It is much more difficult in a world where we are seeking to negotiate, potentially, access to third-country markets and have very little to offer if we have already unilaterally opened our own markets,” Hammond said.
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Responding yesterday, Capital Economics founder Roger Bootle said: “I wouldn't give up on Philip Hammond. I think we can convince him.”
Speaking at the same event, Tory peer Lord Flight added that he is also confident London would one of remain the global financial capitals after Brexit, regardless of its treatment by the EU.
“The two areas where the Single Market is of some import have been banking and investment banking, but I would argue that London is more important to the EU than vice versa,” Flight said.
“I don't rule out the EU shooting themselves in the foot, [but] if they actually bothered to understand the situation they need us more than we need them.”