Brexit LIVE: Hard Brexit for Britain could plunge Germany into RECESSION – shock warning

Posted on Jun 18 2019 - 6:15pm by admin

European Research Group member Mark Francois is backing Boris Johnson for leadership, saying the Tory frontrunner is “absolutely determined to leave on 31st October, whatever the circumstances”. The outspoken Brexiteer maintained a Leave voter should lead the country through Brexit – but suggested leaving the EU with a trade deal would be better than leaving without a deal at all. However, the risk of a hard Brexit has increased as a result of the continued robustness of the UK economy and political uncertainty – wiith powerhouse states like Germany at risk of recession as a knock on effect of a hard exit.

IKB economist Klaus Becknecht said if the Bank of England assumes a worst-case Brexit drop of up to 10 percent in the UK, that means there will be fundamental disruptive factors across Europe.

For Germany there would be GDP growth losses of 2 percent in the first and second year. If GDP dropped n the UK, it would be enough to significantly increase the recession risk in Germany.

Meanwhile, writing in Brexit Central, Mr Francois said an attempt to revive the “dead” withdrawal deal, as promised by Tory leadership rivals would lead to absolute parliamentary trench warfare”.

Mr Francois said: “We should tell the European Council instead that because it will never pass the House of Commons, we have decided to junk it completely and transition straight to the Future Relationship and indeed that achieving a Free Trade Agreement (FTA) is now our desired end state – rather than leaving with No Deal.

“It seems extremely unlikely that our members in the country will pick a final winner who voted Remain in 2016.

 A UK hard Brexit would have knock on effect on GDP across Europe sparking recession in Germany

A UK hard Brexit would have knock on effect on GDP across Europe sparking recession in Germany (Image: GETTY)

“The only candidate who has had the courage – and frankly leadership – to acknowledge that the Withdrawal Agreement is dead, and to propose instead transitioning straight to the Future Relationship and arguing for a comprehensive Free Trade deal, that would allow us to trade to our mutual advantage with our European partners, with low or no tariffs, into the foreseeable future, is Boris Johnson. In short, no deal is still better than a bad deal – but a trade deal is better than both of them.”

The six remaining Tory leadership candidates, including Dominic Raab and Rory Stewart, are due to take face party voting on Tuesday,

Hopefuls will need to find at least 33 Conservative MPs backing their race – or face the exclusion from it.

Plans for Brexit – and how Britain will achieve it’s October 31 deadline – will top the agenda when leadership candidates go head-to head in a second televised leadership debate tonight.

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12.00pm update: Barclay asks Barnier to consider citizens’ regardless of Brexit outcome

Writing to Michel Barnier, the Brexit secretary said joint efforts should remain focused on ensuring an agreement is reached, to allow the UK to leave with a deal.

But Mr Barclay suggested officials “continue to work on how we best protect citizens’ rights in all scenarios”.

He wrote: “I believe we collectively have an opportunity to address these concerns and that we should make sustained efforts to do so, including by fully considering these proposals and the technical issues raised in your letter.

“I note that there is gathering support from Parliamentarians in the European Parliament and other Member States for so doing.”

It comes following a successful amendment tabled by Alberto Costa to guarantee citizen’s rights – which was passewd without opposition in March – although Theresa May warned that the EU would not be able to strike a deal of this kind.

Brexit live: Mr Barclay wants to ring fence citizens' rights regardless of Brexit outcome

Brexit live: Mr Barclay wants to ring fence citizens’ rights regardless of Brexit outcome (Image: GETTY)

11.30am update: Economist says hard Brexit will push Germany into a recession

Writing in German financial publication Das Investment, IKB economist Klaus Becknecht says the risk of a hard Brexit has increased as a result of the continued robustness of the UK economy, the chaos in the British Parliament and the increasing impatience of the British over political uncertainty.

In addition, the economic consequences of an uncoordinated EU exit from the UK and a consequent disruption of economic relations are significantly greater than marginal price increases imposed by selective US tariffs.

Markets, as well as the media, are currently focusing mainly on US trade policy and Trump’s latest tweets, while next door a significantly greater risk is slumbering, especially for the German economy.

But Mr Becknecht said neither the UK Parliament nor May’s successor candidates recognise the agreement between the May government and the EU – while the Eu has said no alternative or re-neogitations will take place.

If the Bank of England assumes a worst-case Brexit drop of up to 10 percent in the UK, that means there will be fundamental disruptive factors across Europe. Such a UK decline would undoubtedly push the German economy into a severe recession. For Germany there would be GDP growth losses of 2 percent in the first and second year.

ut mR to IKB estimates, even a slight decrease of GDP in the UK would be enough to significantly increase the recession risk in Germany.

Additional reporting by Monika Pallenberg

Brexit Live: Mark Francois says Boris should look to a Future Relationship with the EU

Brexit Live: Mark Francois says Boris should look to a Future Relationship with the EU (Image: GETTY)

11.15am: Gary Lineker and Emily Maitlis reported over anti-Brexit tweets

Gary Lineker has come under fire over his pro-Remain tweets and has received numerous complaints for allegedly spreading anti-Brexit propaganda.

Tory MP John Whittingdale, the former Culture Secretary has lashed out against Mr Lineker and BBC’s Newsnight’s Emily Maitlis for failing to remain political neutral over their Brexit views.

Mr Whittingdale, who oversaw the BBC in his former ministerial role, told The House Magazine: “I have much more problem with, for instance, BBC employees expressing highly political views. I have made several complaints about that.”

He added: “I do think the BBC perhaps needs to have further thought about it on the basis that – it’s not their fault – but this argument [Brexit] is going to go on for a very long time.

“The strength of opinion on both sides – people get very angry.

“On the one hand, you’ve got a lot of Brexit supporters who think the BBC is clearly biased and very unbalanced, then you’ve got Andrew Adonis on the other side who calls it the Brexit Broadcasting Corporation, on what possible basis I have no idea.”

Gary lineker and Emily Maitlis are under fire for their

Brexit Live: Gary Lineker and Emily Maitlis are under fire for their “anti-Brexit’ Tweets (Image: GETTY)

10.45am update: Ruth Davidson says Tories should not team up with Brexit Party

Ms Davidson has warned Tories against forming an alliance with Nigel Farage’s Brexit Party in a bid to save Brexit, insisting it would signal an outright “defeat”

Writing in the Daily Telegraph, the Scottish Tory MP said: “We have a prime minister with one foot out the door and a leadership election which has split the party between cheerleaders for the frontrunner and anyone-but-the-frontrunner.

“Collective cabinet responsibility has broken down, reports suggest donors are withholding support, local associations are moving to deselect sitting MPs, while other MPs have already given up the Conservative whip in order to sit as independents or throw their weight behind a new party which ended up being dead on arrival.

“It’s no wonder that even lifelong Tories are openly suggesting a formal electoral pact with the Brexit Party as the best or only way to keep Jeremy Corbyn from the door of Number 10.

“While I may agree, in part, with the diagnosis – I strongly disagree with the proposed cure.

“To survive, (the Conservatives) do need the right response. Doing a deal with the Brexit Party would be an admission of defeat. And we’re not dead yet.”

Brexit live: Ms Davidson said Tories should not united with Brexit Party

Brexit live: Ms Davidson said Tories should not united with Brexit Party “under any circumstances” (Image: GETTY)

10.20am update: Johnson’s former leadership rival Leadsom backing him for leadership

Boris Johnson got a further boost in his campaign to become Britain’s prime minister on Tuesday when a second former rival in the race backed him to lead the country out of the Brexit crisis.

Ms Leadsom declared her support for Johnson, telling LBC radio: “He is the best placed to get us out of the EU at the end of October.

“Secondly, I do believe he is an election winner.”

READ MORE: Tory Leadership Live: Michael Gove in desperate plea as Rory Stewart surges ahead

Brexit live: Boris' former leadership rival now backs the leadership frontrunner for office

Brexit live: Boris’ former leadership rival now backs the leadership frontrunner for office (Image: GETTY)

10.00am: Hammond “prepared to resign” over May’s legacy spending plans

Chancellor Philip Hammond has warned he owuld be prepared to resign after he was asked to free up funds from his Brexit war chest.

Sources told the Press Association that tension between officials at the Treasury and the Mrs May’s office had reached boiling point over May’s spending intentions according to a report by ITV.

It claimed Mrs May’s intention to spend up to £9billion per year on education over three years, including plans to build new schools and pay teachers higher wages have sparked tension.

These funds would be taken from the £26.6billion chest Hammond has reserved in the case of no deal Brexit

But the chancellor has opposed those plans and would resign over the issue, according to a well placed source.

Brexit live: Mr Hammond said he would resign if no deal Brexit funds were spent on schools

Brexit live: Mr Hammond said he would resign if no deal Brexit funds were spent on schools (Image: GETTY)

9.30am update: Germany’s EU affairs minister: “no chance of renegotiating deal”

Michael Roth reiterated Germany’ stance that it will not renegotiate the terms of the UK’s departure from the EU.

Arriving in Luxembourg for a meeting with EU counterparts, Mr Roth said: “”I don’t see any chances to renegotiate the package, the withdrawal agreement is the withdrawal agreement, and I don’t see any appetite to start new negotiations within the European Union.”

Brexit Minister Steohen Baclary is also in Luxemborug attending the regular member state meeting.

Mr Javid pointed the finger at leadership rival Rory Stewart over his 'remain' Brexit stance

Mr Javid pointed the finger at leadership rival Rory Stewart over his ‘remain’ Brexit stance (Image: GETTY)

9.10am update: Home Secretary says Stewart wants to “remain” in EU

Sajid Javid said hisa Tory leadership rival Rory Stewart has “told us he wants to remain”.

He told the Today programme: “I think he’s effectively telling us that we should remain in the EU and there is a small constituency amongst my colleagues that would rather remain than leave, and I think that is part of the challenge that we have to deal with.

“And so I think up to a point Rory can attract that support but it’s not going to get us any further.”

Following the interview, Mr Stewart: “I’m sure Sajid didn’t mean that. He knows how fiercely and passionately we have both campaigned to get the withdrawal agreement through – and how although I – like he – voted Remain, we have fought together sincerely as fellow Cabinet Ministers for a moderate and pragmatic .”

Brexit Live: Rory Stewart

Brexit Live: Rory Stewart (Image: GETTY)

8.45am update: Rory Stewart would “love” to go against Mr Johnson

Tory leadership hopeful Rory Stewart has said he has “no problem” being the “stop Boris” candidate.

He told BBC Radio 4’s Today programme. “I have no problem with that and I would love to go against him in the final two in order to give members the chance to choose whether they want Boris’s  or mine,”

The International Development Secretary also faced questions about his back story, amid reports that he allegedly worked as a spy.

Asked if former spies could, under the law, answer honestly whether they worked for MI6, he said: “No, and in fact the law wouldn’t allow newspapers to reveal the identity of intelligence officers.

“I definitely would say I served my country and if somebody asked me whether I am a spy I would say no.”

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