LONDON – Britain’s economic recovery from the coronavirus pandemic will more than halve should the country fail to strike a post-Brexit trade deal with the European Union, KPMG forecast on Wednesday.
Gross domestic product (GDP) growth will reach 4.4% in 2021 without a deal, the accountancy group estimated.
That compared with a 10.1% expansion following a deal, KPMG predicted.
Reports suggest that London and Brussels are inching towards a trade agreement ahead of a year-end deadline.
KPMG also forecast that the UK economy will have slumped by 11.2% this year on Covid-19 restrictions.
“The impact of Brexit will single the UK out among advanced economies next year,” said Yael Selfin, chief economist at KPMG UK.
Selfin urged the UK government to increase investment on infrastructure and skills “to alleviate the longer-term impact that Brexit will have on productivity and growth”.
Britain formally quit the European Union in January but has continued to observe all its rules during a transition period that ends at 2300 GMT on December 31.
While Britain’s economy enjoyed a record third-quarter rebound from its deepest ever recession, experts predict another slump amid fresh coronavirus restrictions to curb the pandemic.
UK gross domestic product expanded by 15.5% in the July-September period, after an initial coronavirus lockdown was eased, recent official data showed.
Activity bounced back after shrinking by almost a fifth in the second quarter on the first lockdown.
Britain's Covid-19 death toll has meanwhile passed 50,000 -- the highest in Europe. – AFP, November 18,2020
