When do we talk about a recession? According to the theory, if an economy records contraction for two quarters in a row. From then on, an analyst might add to the word recession the aggressive designation of ‘mild’, ‘moderate’ or ‘rapid’. But whatever adjective precedes it, a recession is a recession and it affects the economy and the political strategy of every country.

The British economy seems to be heading in this direction. Figures from the Office for National Statistics (ONS) for the July-September quarter were revised just on Friday and showed a contraction in Gross Domestic Product of 0.1%, down from the initial estimate of 0%. At the same time, on the same day, the service reviewed the data for the quarter of April – June, and from 0.2% growth it finally became zero.

Analysts see sluggish growth for 2024

The government’s only hope in London – to avoid recession – seems to be the census of the last quarter of the year, with Downing Street appearing optimistic. The Office of the Budget (OBR), however, predicts growth in the October-December quarter at a fragile 0.1%.

Capital Economics economist Ashley Webb told the BBC that “regardless of the ‘mini-recession’ the broad picture of analysts paints a sluggish UK economy for 2024”. With national elections just a breath away as they are expected at the end of next year, the economy is predicted to be the main ‘key’.

The landscape is expected to become clearer in February, when the figures for the last quarter of 2023 are published. In general, the country’s growth is among the weakest among the G7 group. Specifically for the period October – December 2019 to the period July – September 2023, the data showed that the United Kingdom is sixth on the list with 1.4% growth. Only Germany is behind him.

Is Brexit to blame?

The weak picture of the economy comes to intersect once again with Brexit. Although the effects on investments, according to economic analyses, are not entirely clear, what is certain is that it has negatively affected the labor market.

In recent years, European workers have been moving away from the British market, creating a serious problem for British entrepreneurs. The labor market and how it is formed is one of the “keys” to a country’s development. It determines whether a business will grow and whether employees will receive higher salaries or suffer unexpected cuts.

At the same time, the export deals and full freedom demanded by the Brexiteers, after the “breaking” of the ties from the EU, are not going as the conservative government had hoped. The most recent example is cheese exports to Canada. According to a Guardian report, as of January 1, British cheese makers will face tariffs of up to 245%.

Months of negotiations between the two countries failed miserably, with the Commonwealth country rejecting any British proposal. In fact, he didn’t even extend the regime already in place – which still operates under EU rules – with Trade Minister Cammy Beydenock left “hanging” despite her own assurances.

The numbers of the above items are typical. It is estimated that it will cost the British cheesemaker up to £50 more per kilo of cheese. The importance of the cooperation between the two countries is also reflected in the official figures, as in 2022 British cheesemakers exported cheese worth 18.7 million pounds to Canada.