OUTGOING Bank of England Governor Mark Carney today took aim at the hot favourite to become the next prime minister, Boris Johnson, as he dismissed his claims that the UK can avoid EU tariffs in a no-deal Brexit.
Carney, who steps down on January 31 next year, told the BBC that leaving the EU without a transition deal should be a choice taken with “absolute clarity” about what it would mean for the economy, which would take short-term and long-term damage.
Johnson claimed in a leadership debate this week that the UK could leave the EU tariff free “under GATT 24, or whatever it happens to be”, referring to a clause in the General Agreement on Tariffs and Trade which permits trade to continue unchanged between two parties if they so decide. But Carney said such an arrangement applied only when a trade deal was in place or about to be in place, which is not the case in a no-deal scenario.
He said: “We should be clear that not having an agreement with the European Union would mean that there are tariffs, automatically, because the Europeans have to apply the same rules to us as they apply to everyone else.”
The Governor has previously warned about the economic impact of a no-deal Brexit, prompting anger among Brexiteers.
Johnson is pushing for an EU exit on October 31 with or without a deal.
