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Treasury Leaders Summit 3: Strategic view and implications of Brexit

The standout session on the second day was the presentation by Lord Malloch Brown, former Deputy Secretary General, United Nations whose presentation “Keynote: Through the Fog: what really matters in the age of uncertainty” was an illuminating and impressive broad brush review of the main global trends and pressures - more about this later when we receive the slides. His approach was to bring major trends together and then say what he thought was happening and the consequences.
On Brexit, in answer to a question on whether the impact of the UK withdrawing from the EU would be that the EU would unravel? He explained that in his opinion the EU reaction was to deepen their relationship with new sharing and integration procedures, and have ever closer union even though there are some countries misbehaving, e.g. Italy. This interesting, but his assessment on Brexit was devastating:
    1.    “Having seen what is happening in the UK (due to Brexit), member countries (including Italy) have backed away from any thought of leaving the EU. It has cemented everyone else into Europe.”
    2.    He also explained that today we need a strong and reforming Europe to resist the challenges of the pressures from China and security challenges from Russsia, and the declining USA, but instead we have a very weakened Europe, and Brexit makes it worse. “It is not that we are leaving a sinking ship. I take the opposite view that Europe desperately needs the leadership in diplomacy, security, etc., of the UK. The rift will become a self fulfilling prophecy, e.g. 10 years from people will say ‘now we told you that.’ But it will be costly that we pulled the first brick out and the European project is dismantled.”
    3.    “Brexit will cost the UK through lost trade and increased costs. And lost influence.”

CTMfile take: As my learned consultant friend (who rang while I was writing this post) said, “Brexit is bollocks.” A more balanced analysis is given in The Financial Times today in which Philip Stephens explains ’The Brexit road to Britain’s collapse.’

This item appears in the following sections:
Cash & Liquidity Management in Europe
Global Cash & Liquidity Management

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