British economic growth is stable, and analysts expect a growth rate of between 1.5 and 2.2 percent in 2018.
In 2017, U.K. government deficits were the lowest in ten years, and investment was surprisingly high, especially in the tech sector. While inflation has increased to 3.1 percent, the Bank of England anticipates that it will fall this year.
Why is all this relevant to you? Because it shows that 18 months after the June 23, 2016 Brexit vote, the U.K.'s economy is doing much better than many commentators had expected. It shows that national sovereignty and the globalized economy can coexist in harmony.
And that's a very different narrative to what we heard from most in the media after Britons voted to leave the European Union. In the New York Times, Philippe Legrain suggested that "businesses are likely to continue to put investments on hold. Consumers may pull back, too. The resulting downturn will cause the government’s budget deficit, already large, to swell."
At the Washington Post, Sebastian Mallaby was "anticipating the recession that is likely to come."
Dave Zirin of the Nation described Brexit as one of "the greatest humiliations." (In his defense, his column correctly also applied that description to England's soccer loss to Iceland.)
Ryu Spaeth gave the New Republic's view, declaring that Britain "has doomed itself to be a smaller, weaker country."
Amusingly, the naysaying continues to this day. Writing in the New Yorker recently, John Cassidy declared that even though the U.K.'s economy is doing far better than the commentariat expected, Britain's economy must still be considered bad because a left-wing think tank says it's bad.
Still, the results are clear: Britain is well positioned to minimize the short-medium term economic fallout of Brexit.
Personally, I believe that the U.K. would be seeing higher growth had it voted to remain in the E.U. and thus ensure business and foreign investment confidence for the foreseeable future. Yet, in Theresa May's effective (if slow-to-gain-momentum) approach towards negotiations, the Prime Minister is delivering for Britain. Since December, May has seen increasing success in winning concessions to safeguard British economic interests. These developments find reflection in the increasingly strong British pound and should lead to strong investment in 2018. And while the Brexit negotiations remain complex and weighted in the E.U.’s favor, the next steps should be positive in that Britain offers capabilities in areas such as intelligence sharing that the E.U. desperately needs.
Regardless, the simple point is this: Those who said Brexit and sovereignty were recipes for economic doom must fess up to the fact that they spoke from ignorance and have been proven completely wrong.
