Chancellor Rachel Reeves and the EU: Brexit ice is beginning to thaw

AT a Mansion House dinner in the City of London just a few weeks ago, the Governor of the Bank of England, Andrew Bailey, stopped short of offering an opinion on Britain’s departure from the European Union, preferring instead to ‘point out the consequences’ of Brexit.
Not her cup of tea: Chancellor Rachel Reeves is in Brussels to discuss a 'more business-like' relationship with the EU as she decries the chaos and division that went before this Labour Government (photo: PA)Not her cup of tea: Chancellor Rachel Reeves is in Brussels to discuss a 'more business-like' relationship with the EU as she decries the chaos and division that went before this Labour Government (photo: PA)
Not her cup of tea: Chancellor Rachel Reeves is in Brussels to discuss a 'more business-like' relationship with the EU as she decries the chaos and division that went before this Labour Government (photo: PA)

It isn’t unusual for BoE governors to refrain from engaging with contentious issues, which is precisely why him stating that Brexit had ‘weighed’ on the economy, small exporters in particular, represents a warning that must be heeded.

In the wake of the parting of ways from the EU, there has been an accumulation of evidence, anecdotal and empirical, that supports the case for both leave and remain: services, for example, have enjoyed strong export levels, in contrast to the experience of goods exporters.

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And yet there remains the immutable hand of democracy, grasping tightly the result of the EU referendum: there can be no escaping the fact that more people voted to leave than voted to remain in the EU, and it is in that context we must view Chancellor Rachel Reeves’ foray into what is arguably the most politically toxic of topics in a generation.

The conundrum for the Chancellor is an intractable one: her self-styled raison d’être is to strategically and structurally set the United Kingdom on a growth trajectory, leaving opportunity and prosperity in its wake.

Today, her remarks indicate a thawing of hostilities between the UK and our European neighbours, the quality of life of people living in this country put before partisan, populist politics. The Chancellor makes no bones about previous fractiousness, reminding us of the chaos and division of the previous Government. It is as delicate as it is invidious; deft diplomacy will be required in spades if she is to win both the trust of trading partners and the electorate.

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