Hunt questions watchdog forecast of 4% hit to UK economy from Brexit

(Bloomberg) — U.K. Chancellor of the Exchequer Jeremy Hunt disputed predictions by Britain’s fiscal watchdog that Brexit would shrink the size of the economy, saying leaving the European Union could actually make Britain richer.

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“What I don’t accept is that the long-term impact of this decision is going to make us poorer,” Hunt told Sky News in an interview on Thursday, when asked about the Office for Budget Responsibility’s 4 percent Brexit forecast. Remaining in the EU was hit. “I don’t accept 4 percent.”

Hunt said the forecast did not take into account the potential benefits of regulatory changes planned by the British government, citing areas such as new medicines and artificial intelligence. His comments come as evidence mounts that Brexit is hurting the economy – through higher trade barriers with the UK’s largest trading partner – and as Britons show signs of regret.

READ MORE: UK seeks Brexit benefits as promised ‘freedoms’ fade

“We have a lot of opportunity to be richer than we were before,” Hunt said, adding that his aim was to make the UK the next Silicon Valley. “Being able to make your own rules means you can do things in a way that wasn’t possible.”

Since the 2016 Brexit referendum, the UK government has yet to implement major legislative changes of major benefit to business. Instead, companies have had to grapple with rising trade paperwork costs, a tightening labor market as a drop in EU immigration and a weaker pound increasing import costs. Brexit also comes with a political cost of heightening tensions in Northern Ireland and damaging diplomatic relations with the EU.

This week, Hunt said he wanted to stick to Boris Johnson’s zero-tariff, zero-quota trade deal with the EU and dismissed reports that Britain was considering a closer Swiss-style relationship with the bloc.

“It’s not the right deal for the UK,” Hunt told Sky television when asked about the EU’s relationship with Switzerland, which gets greater market access in exchange for payments to the EU budget and other concessions. “As an independent sovereign nation, we will have different regulations.”

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