Economic lookahead: w/c 12 March

Unemployment figures released, second Greek bailout discussed, and goldbugs debating at the IEA.

Monday

  • Eurozone finance ministers meet, and are expected to approve the second Greek bailout now that the country has fulfilled it requirements by convincing creditors to drop more than €100bn of debt'
  • UN World Water Development Report says demand for water is threatening all major development targets.
  • World Travel & Tourism Council say that air passenger duty is costing the UK economy billions.
  • Centre for Economics & Business Research blame rising commodity prices for a fall in real disposeable income in the UK.
  • FSB's Voice of Small Business Index released.

 

Tuesday

  • Annual review of the inflation basket. Previous years have seen the introduction of Blu-ray players and flatscreen TV's, and the merging of "women's trousers" and "women's skirts".
  • OECD harmonised unemployment rates; released the day before the UK's own unemployment figures, these serve as a useful international comparator.
  • Department for Communities and Local Government release their house price index. The only government-collated house price index, these will be the figures to use to examine the NewBuy program.
  • ONS releases the UK trade figures.

 

Wednesday

  • UK unemployment figures released. Expected to show a rise in unemployment and youth unemployment.
  • Mark Hoban, Financial Secretary, will be up in front of the European Scrutiny Committee talking about the eurozone debt crisis.
  • Consumer Credit Counselling Service will release their annual statistical yearbook. Personal debt has fallen out of the spotlight, but there's growing consensus that if there is another debt crisis, this is the sector it will fall upon.
  • Lord Turner, chairman of the FSA, will interviewed by the Treasury Select Committee about mortgages.

 

Thursday

  • OECD launch their report on the medium term environmental outlook.
  • IEA host a discussion on the return to the gold standard, 6:30pm, London.
  • Debate on lowering the price of motherhood at the Resolution Foundation, 10:30am, London.
  • IMF board to discuss the second Greek bailout.

 

Friday

  • Financial policy committee of the Bank of England to meet.
  • Japan releases its monthly economic report.

 

The basket of goods which determines inflation is set to change. Credit: Getty

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Theresa May gambles that the EU will blink first

In her Brexit speech, the Prime Minister raised the stakes by declaring that "no deal for Britain is better than a bad deal for Britain". 

It was at Lancaster House in 1988 that Margaret Thatcher delivered a speech heralding British membership of the single market. Twenty eight years later, at the same venue, Theresa May confirmed the UK’s retreat.

As had been clear ever since her Brexit speech in October, May recognises that her primary objective of controlling immigration is incompatible with continued membership. Inside the single market, she noted, the UK would still have to accept free movement and the rulings of the European Court of Justice (ECJ). “It would to all intents and purposes mean not leaving the EU at all,” May surmised.

The Prime Minister also confirmed, as anticipated, that the UK would no longer remain a full member of the Customs Union. “We want to get out into the wider world, to trade and do business all around the globe,” May declared.

But she also recognises that a substantial proportion of this will continue to be with Europe (the destination for half of current UK exports). Her ambition, she declared, was “a new, comprehensive, bold and ambitious Free Trade Agreement”. May added that she wanted either “a completely new customs agreement” or associate membership of the Customs Union.

Though the Prime Minister has long ruled out free movement and the acceptance of ECJ jurisdiction, she has not pledged to end budget contributions. But in her speech she diminished this potential concession, warning that the days when the UK provided “vast” amounts were over.

Having signalled what she wanted to take from the EU, what did May have to give? She struck a notably more conciliatory tone, emphasising that it was “overwhelmingly and compellingly in Britain’s national interest that the EU should succeed”. The day after Donald Trump gleefully predicted the institution’s demise, her words were in marked contrast to those of the president-elect.

In an age of Isis and Russian revanchism, May also emphasised the UK’s “unique intelligence capabilities” which would help to keep “people in Europe safe from terrorism”. She added: “At a time when there is growing concern about European security, Britain’s servicemen and women, based in European countries including Estonia, Poland and Romania, will continue to do their duty. We are leaving the European Union, but we are not leaving Europe.”

The EU’s defining political objective is to ensure that others do not follow the UK out of the club. The rise of nationalists such as Marine Le Pen, Alternative für Deutschland and the Dutch Partij voor de Vrijheid (Party for Freedom) has made Europe less, rather than more, amenable to British demands. In this hazardous climate, the UK cannot be seen to enjoy a cost-free Brexit.

May’s wager is that the price will not be excessive. She warned that a “punitive deal that punishes Britain” would be “an act of calamitous self-harm”. But as Greece can testify, economic self-interest does not always trump politics.

Unlike David Cameron, however, who merely stated that he “ruled nothing out” during his EU renegotiation, May signalled that she was prepared to walk away. “No deal for Britain is better than a bad deal for Britain,” she declared. Such an outcome would prove economically calamitous for the UK, forcing it to accept punitively high tariffs. But in this face-off, May’s gamble is that Brussels will blink first.

George Eaton is political editor of the New Statesman.