UK grows faster in January

The UK economy grew faster in January, and is now growing faster than the Euro area, France, Germany and Italy. Thanks to Brexit!

The latest annual figures for the main advanced economies shows tax cutting USA way out ahead with 3.1% gr0wth in  2018, the UK at 1.3%, France at 0.9%, Germany at 0.6% and Japan at 0.3%. Italy has spent the last half year in recession.

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43 Comments

  1. javelin
    Posted March 12, 2019 at 11:46 am | Permalink

    Linklaters concludes

    “the English courts are likely to continue to follow the Walford lead and conclude that this type of obligation [negotiate in good faith] is unenforceable under English law.”

    https://www.linklaters.com/en/insights/publications/tmt-news/uk—obligations-to-negotiate-in-good-faith-where-does-english-law-stand

    • javelin
      Posted March 12, 2019 at 11:50 am | Permalink

      If you read the whole text – unless there are detailed parameters describing what it means to act in bad faith the it is unenforceable.

      However, where an obligation to use good faith to negotiate does not sufficiently prescribe the parameters and objectives of the negotiation (for example, a “binding” commitment letter incorporating an obligation to negotiate in good faith and attaching a termsheet setting out the basis of the detailed negotiations to follow) then the English courts are likely to continue to follow the Walford lead and conclude that this type of obligation is unenforceable under English law.

    • Richard1
      Posted March 12, 2019 at 12:32 pm | Permalink

      Yes I have always understood that a clause containing an agreement to agree is worthless. So now we have it: there is no change to the terrible WA, the side letters mrs may has agreed aren’t worth the paper they are written on. MPs need to vote this down. I think when the vote for an extension comes, as it surely will, we may as well go for replacing the whole WA period with extended membership.

      One other thought though: we need to be free to agree an FTA with the US whilst a Trump is still in office.

    • Denis Cooper
      Posted March 12, 2019 at 12:39 pm | Permalink

      The English courts are also very likely, I would say almost certain, to continue to acknowledge that the UK Parliament is sovereign in matters of UK law, and so if Parliament passes an Act expressly disapplying some or all of the provisions of a new treaty with the EU and its member states which was previously approved by an Act of Parliament then the treaty provisions in question will be duly disapplied on the domestic plane, so making it impossible for the UK government to continue to accept those terms on the international plane.

      I ask once again: did the older hands in the ERG, such as our host, ever accept that the UK could not leave the EU because until December 2009 the treaties made no provision for an EU member state to withdraw, whether by a unilateral decision or by agreement with the EU and its continuing member states?

      Reply Yes we worried about it and pressed for Art 50

      • Denis Cooper
        Posted March 13, 2019 at 10:06 am | Permalink

        Not as I recall, JR.

    • Hope
      Posted March 12, 2019 at 3:28 pm | Permalink

      May was given a request by parliament to replace the backstop. Brady amendment not even considered by her. May stated she would seek legally binding changes to it. May continues today she has got the legally binding changes parliament asked for.

      JR, May knows she has not got legally binding changes to the withdrawal agreement or backstop but stated she got the legal binding changes parliament required. That is a lie isn’t it? This does not even fulfil what she said in November!

  2. Christopher Huddon
    Posted March 12, 2019 at 11:53 am | Permalink

    Are we there yet?

    Lol

    • Posted March 12, 2019 at 12:25 pm | Permalink

      ”Lol” never does add much to an argument. It might work on Facebook though.

  3. Bryan Harris
    Posted March 12, 2019 at 11:58 am | Permalink

    Is this why the chancellor has promised extra £billions for the UK if we stay in the EU pen?

  4. Norman
    Posted March 12, 2019 at 12:00 pm | Permalink

    The BBC gives a different slant – there’s a surprise!
    https://www.bbc.co.uk/news/business-47535182

  5. Christopher Huddon
    Posted March 12, 2019 at 12:06 pm | Permalink

    What have we learnt?

    That they will move

    Let’s nudge them again and vote for no deal

    No deal saves us £39 billion

    • Denis Cooper
      Posted March 12, 2019 at 12:43 pm | Permalink

      They have not moved.

  6. Lifelogic
    Posted March 12, 2019 at 12:07 pm | Permalink

    Indeed and this also despite being hugely over taxed, over regulated everwhere, over charged for green crap energy, having a fairly dire health care and education systems system, having very restrictive planning, having a dishonest, PC, doppe as PM with a broken compass & zero vision, having vast waste in the state sector and suffering an appalling over complex and idiotic tax system and chancellor. Plus hugely uncompetitive and over regulated banking.

    Despite also the very real possibility of a Communist Corbyn/McDonnall/SNP government.

    • Lifelogic
      Posted March 12, 2019 at 12:30 pm | Permalink

      With the above government and EU obstacles removed the UK could easily double its GDP per Cap – rather like Singapore have, but with rather more natural advantages and better economies of scale.

      Vince Cable just now says – the EU have fallen over backwards to be helpful! Sure Vince! Then went on to call for a blantantly fixed second referendum between May’s Brexit in name appalling trap and no Brexit at all. What planet are these dire non Liberal non Democrats on?

    • Lifelogic
      Posted March 12, 2019 at 2:26 pm | Permalink

      Charles Walker MP Chair of the Procedure Committee now trying to threaten people with a general election in a few days with the appalling Appeaser May still as party leader!

      Pathetic and very transparent – the deal is so bad only a complete idiot or a traitor could vote for it! If it goes through the Tories will be done fore.

      Just leave you idiots.

    • Mike Wilson
      Posted March 13, 2019 at 1:08 am | Permalink

      Green energy is not crap.

  7. Posted March 12, 2019 at 12:07 pm | Permalink

    And if Mrs May gets her way and we DON’T leave – how will these figures be affected? And when will the downturn begin?

    • John Hatfield
      Posted March 12, 2019 at 2:53 pm | Permalink

      “And if Mrs May gets her way and we DON’T leave”
      Not sure you are pointing the right way there LJ. Unless of course it is all part of Theresa’s cunning plan.

  8. formula57
    Posted March 12, 2019 at 12:23 pm | Permalink

    And without Chancellor Hammond, UK growth might have been close to that seen in the USA!

    • Lifelogic
      Posted March 12, 2019 at 12:37 pm | Permalink

      Tax to death project fear pusher and economic illiterate Hammond and his dire wrongheaded (PPE) side kick Carney. Plus we have the useless Mayor of London even advertising (using tax payers money) how dreadfully dirty the air is – just to help confidence further. (Or rather just to justify another tax he had introduced, I suppose he needs the money to finance the ads).

      IHT ratters Hammond (and Osborne) haver been driving wealth creators and wealth out of the UK. Economic lunacy from them.

  9. Ian wragg
    Posted March 12, 2019 at 12:45 pm | Permalink

    You forgot “despite brexit ” I e just seen Crispin Blunt being interviewed by BBC and he made an excellent case for voting down the preposterous WA.I also watched Junker making veiled threats to the UK. What a etc ed.

  10. hefner
    Posted March 12, 2019 at 12:46 pm | Permalink

    GDP, the gift that keeps on giving: a bit of history. GDP was created by Simon Kuznets in the 1930s to describe the economic situation of the USA before, during and after the depression (“National Income 1929-1932”, the first published report mentioning GDP) . Already in this report (p.7) Kuznets was pointing out “The welfare of a nation can therefore scarcely be inferred from a measurement of national income as defined above”. But it was (relatively) easy to calculate so time-series of it would indicate how well a country was doing. After WWII this easy-to-produced statistics became the norm that most Western countries adopted to check how they were doing internally and compared to others. More or less from the beginning there were people, economists or social scientists, who pointed out that GDP was not a standard to judge the actual prosperity of the population in a given country, nor a standard to intercompare countries. From the 60s onwards various other possible indicators were studied. Within the last ten years the Happy Planet Index, the Legatum Prosperity Index, the Social Progress Index have appeared. They usually account for something more complex than basic economic inputs/outputs: Basic Human Needs (Nutrition & Basic Medical Care, Water & Sanitation, Shelter, Personal Safety), Foundations of Well-Being (Access to basic knowledge, Access to information and communications, Health and Wellness, Ecosystem sustainability), Opportunity (Personal rights, Personal freedom and choice, Tolerance and inclusion, Access to advanced education).
    With these new indices, the UK appears after Norway, Sweden, Finland, NL, CH, DK, Spain. So not too bad, but not really at the very top of the range.
    And one can wonder why politicians still make monthly announcements about GDP (not even GDP per person). Is it because GDP being one number is easy to understand and politicians do not think the population at large would be able to get anything more complicated? Is it because politicians are still stuck in the mud of the 50s when GDP sustained growth was used to fight the propaganda coming from the Communist countries?
    Whatever the reason, I find indirectly demeaning this stress on GDP, specially when it comes to “mine is bigger than yours”.

  11. villaking
    Posted March 12, 2019 at 1:16 pm | Permalink

    Sir John,

    It would be interesting to understand how you connect the current growth rate (itself unremarkable) with Brexit (an event that has not occurred yet and which you are likely to vote against this evening). As a small businessman I am very aware of the opposite effect of a (possible) Brexit: widespread concern, delayed investment due to the uncertainty, and money being spent on FX hedging and stockpiling of imported goods squeezing out other potential uses of cash for example. I am intrigued as to how a potential Brexit has led to 1.6% growth in your opinion. I would also be most interested to learn about the implied connection between committed membership of the EU and a lower than normal growth rate in Germany. I would have attributed this to factors such as slower global growth, threats to global trade caused by the US and new pollution legislation. Surely these factors might have a negative influence on a country driven by manufacturing exports?

  12. Den
    Posted March 12, 2019 at 2:23 pm | Permalink

    SJ you forget the usual remainer tag, “Despite Brexit”!! LOL.
    If the Country does so well while in the process of leaving, just imagine what we can do once we are completely free of the heavy shackles put upon us by the Brussels cabal. Roll on independence.

  13. robert valence
    Posted March 12, 2019 at 2:53 pm | Permalink

    “Thanks to Brexit!”
    Sir John, I’m surprised at you;
    had you been the BBC it would have been “In spite of BREXIT”!!

    • margaret howard
      Posted March 12, 2019 at 4:29 pm | Permalink

      Robert

      “Had you been the BBC it would have been “In spite of BREXIT”!!

      And a good deal nearer to the truth. And we haven’t left yet – the real horrors are yet to come

      As Kevin Rudd put it with typical Australian bluntness:

      “UK plan to trade with Commonwealth nations after Brexit is ‘utter b**locks’, former Australian PM says”

      https://www.independent.co.uk/news/uk/politics/brexit-uk-trade-commonwealth-kevin-rudd-australia-a8818996.html

      • Edward2
        Posted March 12, 2019 at 10:25 pm | Permalink

        Very strange story because barely a few days ago the FT and other proper papers ran a big story stating how the Australian government would be happy to do a fast trade deal with the UK in the event of a no deal. .
        Mind if it is in the Independent the top on line “newspaper” it must be right eh Margaret?

      • libertarian
        Posted March 13, 2019 at 9:28 am | Permalink

        Morning Margaret

        Been out of circulations for a while away on business. I’m just back from Pakistan, setting up some trading links, now whats this all about from the socialist, non business person Mr Rudd telling us that we can’t trade with the Commonwealth countries …..hmmm

      • Mitchel
        Posted March 13, 2019 at 11:45 am | Permalink

        Kevin Rudd speaks more as a fully paid up globalist than a former PM-have a look at the portfolio of roles he has taken on since leaving Australian politics.

    • Richard1
      Posted March 12, 2019 at 4:53 pm | Permalink

      The BBC explains a slight filip in UK growth as stockpiling ahead of a possible no deal-crash-out-cliff-edge-everybody-might-die Brexit.

  14. hans christian ivers
    Posted March 12, 2019 at 3:20 pm | Permalink

    Sir JR,

    The tax cuts in the US have led to a government deficit of more then 4% and the increased growth is unfortunately not leading to significantly higher tax revenue

    • Edward2
      Posted March 12, 2019 at 4:30 pm | Permalink

      I note you say ” not significantly higher”
      Income taxes up 6% in 2018 raising 14 billion more despite big cuts.
      Excise taxes up 13%
      Not too bad.
      The deficit is due to spendthrifts in Congress not reigning in spending.

      Would it gave better to keep taxes high and have sacrificed economic job and wage gains so the government could collect a bit more tax ?

      • hans christian ivers
        Posted March 13, 2019 at 6:38 pm | Permalink

        Edward 2

        The budget has been agreed between Congress and the President and is much much bigger due to the tax cuts than the extra revenue.

        You missed the point again, the deficit is close to US$ 1 trillion

    • libertarian
      Posted March 12, 2019 at 7:29 pm | Permalink

      Dear Hans

      Whoops

      Federal Revenues Hit All-Time Highs Under Trump Tax Cuts

      https://www.investors.com/politics/editorials/trump-tax-cuts-federal-revenues-deficits/

      • hans christian ivers
        Posted March 13, 2019 at 6:40 pm | Permalink

        Libertarian,

        Nothing compared to the size of the increased deficit size there is no whoops

  15. Eric Cire
    Posted March 12, 2019 at 5:23 pm | Permalink

    UK growth includes the minus contributions made by the celtic regions – imagine the growth for England combined with England being in busget surplus to the tune of more than £10bn (UK is minus £26bn)

  16. Chris Rooke
    Posted March 12, 2019 at 6:30 pm | Permalink

    Sorry John but it’s ridiculous that you and rest of ERG are voting against. You are putting purity over parliamentary arithmetic. This deal at least gets us half out of the door. If it goes down we in all likelihood don’t leave at all.

  17. STOP THE BBC
    Posted March 12, 2019 at 7:23 pm | Permalink

    BBC News channel also forget themselves and think they are the Establishment news channel as they have experts on saying ‘no one wants Theresa Mays job right now’, err, dont they mean no one in the globalist Establishment cabal wants her job right now? I would have her job in a heart beat.
    Also, BBC News channel giving endless coverage to those presenting passionate pleas for TMs ‘agreement’, like that Bilderburg favourite Rory Stewart for example. Then when they go to their EU correspondant it is some woman who tells us the EU have bent over backwards to please us etc etc. This and much more (it is all agonizing to watch).

    According to BBC News channel all MPs not willing to support TM now are “not willing to compromise”, presented as irrational extremists, “hardline”.

  18. Alex Green
    Posted March 12, 2019 at 7:48 pm | Permalink

    What evidence do you have that the higher UK growth rate is because of Brexit? How do you know we wouldn’t be further ahead if the referendum had never taken place?

  19. Steve
    Posted March 12, 2019 at 8:26 pm | Permalink

    I write shortly after May’s capitulation was voted down.

    So, the next vote concerns deal or no deal.

    It has to be no deal, or else.

  20. Posted March 12, 2019 at 8:36 pm | Permalink

    Please excuse me going off topic to try to bring something out into the open. Various folk e.g. ‘Gina’ have tried to use legal means to stop Brexit. Can Brexiteers now use similar tactics to ensure that Brexit happens by 29th March. – What is good for the goose (Gina) is good for the gander! Surely the tight time frame is ripe for such tactics?

  21. Anonymous
    Posted March 12, 2019 at 8:38 pm | Permalink

    It took but a single speech and that was it – she was gone. A giant of the era. Thatcher. Easy peasy.

    May on the other hand …

    I suppose we are all used to the groundhog monotony of forty years of rap ‘music’. Dum da da dum daa dum-da dum dum… and on and bloody on. Sing up everybody !

    (Not you, Andy. Ode to Joy for you.)

    • Mitchel
      Posted March 13, 2019 at 11:48 am | Permalink

      Thatcher was breaking the Establishment mould,May was poured into that mould – and set solid.

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    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

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