On 17 October 2019, the UK government and its EU counterparts concluded a renegotiation of the previous withdrawal agreement and political declaration which sets out the framework for their future ...relationship. The government hoped that this would enable the UK to leave the EU on 31 October 2019 and then, after a transition period lasting to the end of 2020, trade with the EU under a free trade agreement while negotiating new trading arrangements with other countries.
COMMENTARY Hantzsche, Arno; Young, Garry
National Institute economic review,
05/2018, Volume:
244, Issue:
244
Journal Article
Peer reviewed
Open access
In his Spring Statement, the chancellor said that he saw light at the end of the fiscal tunnel. We are afraid that this will turn out to have been an illusion. While public borrowing has been reduced ...to sustainable levels, our analysis of the prospects for the public finances points to severe challenges ahead. Sustainable borrowing has been achieved by cutting back on public services and restraining public sector pay. But ‘austerity fatigue’ is now setting in, and emerging recruitment difficulties and concerns about the quality of public services mean that there are already strong pressures for public spending to rise. On top of that, the demand for public services is increasing sharply to meet the needs of an ageing population. That provides a difficult background for the 2019 Spending Review. With debt already at an uncomfortable level, increasing public spending by substantially more than currently planned would need to be financed with higher taxation or more direct charging for services. The alternative option of continued spending restraint would not be palatable unless government can find significant ways to improve efficiency and get better value for money.
PROSPECTS FOR THE UK ECONOMY Hantzsche, Arno; Young, Garry
National Institute economic review,
11/2019, Volume:
250, Issue:
250
Journal Article
Peer reviewed
Open access
The economic outlook is clouded by significant economic and political uncertainty; a general election is widely expected and Brexit unresolved. The outlook depends critically on the nature of the ...trading relationship between the United Kingdom and the European Union and other countries.
PROSPECTS FOR THE UK ECONOMY Hantzsche, Arno; Young, Garry
National Institute economic review,
05/2019, Volume:
248, Issue:
248
Journal Article
Peer reviewed
Open access
The main development since our last forecast is that the United Kingdom's exit from the European Union did not take place on 29 March as had been planned. Instead, the exit date has been pushed back ...to 31 October 2019, with the possibility of leaving earlier if some way around the existing parliamentary impasse can be found before then. This means that the recent period of high political and economic certainty is set to continue and probable intensify.
Prospects for the UK Economy Hantzsche, Arno; Young, Garry
National Institute economic review,
08/2019, Volume:
249, Issue:
1
Journal Article
Peer reviewed
The short-term outlook for the UK economy is very murky indeed, with a significant risk that a severe economic downturn will begin within the next 6 months. With economic growth already faltering, a ...disorderly no-deal Brexit could cause widespread disruption to trade a sharply lower exchange rate, higher inflation and lower living standards.
USING NiGEM IN UNCERTAIN TIMES Hantzsche, Arno; Lopresto, Marta; Young, Garry
National Institute economic review,
05/2018, Volume:
244, Issue:
244
Journal Article
Peer reviewed
This paper introduces a special issue of the Review on how the National Institute Global Econometric Model (NiGEM) is being used to navigate uncertain times. NiGEM is the leading global macroeconomic ...model, used by both policy-makers and the private sector across the globe for economic forecasting, scenario building and stress testing. The paper summarises the main features of NiGEM and describes some standard model simulations to illustrate how the model responds to monetary, fiscal and technology shocks.
PROSPECTS FOR THE UK ECONOMY Hantzsche, Arno; Kara, Amit; Young, Garry
National Institute economic review,
02/2019, Volume:
247, Issue:
247
Journal Article
Peer reviewed
With less than two months to go before the Article 50 EU exit date, the spectrum of Brexit outcomes remains as wide as ever. The House of Commons overwhelmingly rejected the government's exit deal ...and on 30 January the Prime Minister signalled her intention to renegotiate the deal with the European Union (EU). If agreement cannot be reached then, under current law, the UK will leave the EU on 29 March without a deal. Exiting without a deal is nevertheless far from inevitable for the simple reason that Parliament has rejected a no-deal Brexit in an amendment on 29 January. These developments, together with the weight of contradictions that afflicts all plausible scenarios, keep open the likelihood of any of them emerging. This is not to say that the impasse cannot be broken (Aidt et al., 2019) but until a mechanism to resolve these contradictions emerges, there is a non-negligible possibility of a wide variety of outcomes ranging from an extension of the Article 50 deadline, a second referendum or citizen assemblies, membership of the European Economic Area, no deal or even a version of the government's deal emerging as the final outcome. Some of these will not be known until well after March 2019 for the simple reason that negotiations related to the future relationship will only begin after the UK exits the EU.
PROSPECTS FOR THE UK ECONOMY Hantzsche, Arno; Kara, Amit; Young, Garry
National Institute economic review,
11/2018, Volume:
246, Issue:
246
Journal Article
Peer reviewed
Open access
What is striking about political and economic developments in the UK over the past few months is the disconnect between the two. Negotiations with the European Union on the Withdrawal Agreement and ...the Political Declaration appear to have reached a roadblock on the Irish border issue even though the government appears ready to make concessions on its White Paper proposal. At the same the, the ruling Conservative Party, Parliament and the country, more generally, remain divided on the future relationship with the EU.
PROSPECTS FOR THE UK ECONOMY Kara, Amit; Hantzsche, Arno; Lennard, Jason ...
National Institute economic review,
08/2018, Volume:
245, Issue:
245
Journal Article
Peer reviewed
The UK economy has strengthened since the middle of 2017. Growth has been supported by a buoyant global economy and the weak exchange rate, which together have helped rebalance overall growth away ...from domestic demand and towards net trade. This rebalance remains a key feature of our forecast.
The World Economy: World Overview Naisbitt, Barry; Hantzsche, Arno; Lennard, Jason ...
National Institute economic review,
02/2019, Volume:
247, Issue:
1
Journal Article
Peer reviewed
After two years in which world economic growth has been boosted by tailwinds, such as accommodative financial conditions and a US fiscal stimulus, our forecast sows global economic growth slowing as ...headwinds, especially from increased uncertainty over trade prospects, have mounted. The rebound from under-performance in 2016 and the boost from the US stimulus is now waning as increased trade uncertainty, higher US interest rates and slowing Chinese growth moderate global growth.
PDF
