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Brexit: Mark Carney warns of no-deal "economic shock"



  Governor of the Bank of England Mark Carney

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Reuters

The Governor of the Bank of England has called on MPs to solve Brexit's impasse to warn of a growing threat to the global economy.

Mark Carney said that failure to agree to a Brexit deal would trigger an "economic shock" for Britain.

It would also send the wrong message as protectionism rose worldwide.

"It is in the interest of everyone, probably everywhere" that a Brexit solution is found, he said.

It comes one week after the bank cut its growth forecasts for the UK in 201

9, partly because of the uncertainty surrounding Brexit.

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In a speech at Barbican in London, Carney said there is "a high degree of uncertainty" about Brexit and it's clear that "companies are holding back to make big decisions. "

He also stressed the importance for the UK economy of securing a withdrawal agreement with the EU and ensuring a smooth transition.

"A no deal would be an economic shock to this country, and this would be a global signal for the re-establishment of globalization, which would be regrettable," he said.

He also described Brexit as "acid testing", "whether a way can be found to enhance the benefits of economic" openness while improving democratic accountability. "

Global Concerns

At the global level Carney said that growth in "all regions" slowed to peak at 4% in 2016.

He said that growth is likely to stabilize, but warned that a further slowdown in China, rising trade tensions and complacency

Therefore, policymakers around the world had to avoid being "complacent" about economic risks such as rising consumer debt and the introduction of trade barriers.

"The frequency of financial crises in history is at stake Part of the fact that the memories diminish, the financial lobbies mä are financially viable and the costs of relapse in the financial reform are initially invisible, "he said.


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