by David Milliken

WASHINGTON (Reuters) -Brexit is likely to continue to weigh on Britain’s economic growth over the coming years, and that should serve as a warning to the rest of the world about the damage caused by trade barriers, Bank of England (BoE) Governor Andrew Bailey said on Saturday.

The BoE has long said that the 2016 vote to leave Britain from the European Union (EU) penalized the country’s exports by increasing regulations, despite the 2020 agreement to maintain tariff-free trade between Britain and the bloc.

“If you ask me what the impact is on economic growth… the answer is that for the foreseeable future it is negative, but in the longer term there should be a positive, albeit partial, counterbalance,” Andrew Bailey told the Group of Thirty, a think tank that brings together central bankers and financial officials in Washington.

The American capital was the center of attention in the week which ended with the annual meetings of the International Monetary Fund (IMF) and the World Bank which gave ample space to the impact of the customs duties wanted by President Donald Trump.

Andrew Bailey says Brexit proves that businesses can adapt to tougher trading conditions, but it takes time and growth will always fall short of its potential.

“If you make an economy less open, growth will be limited, but in the longer term, trade will adjust and rebuild. This is what seems to have happened. The same argument applies to the global economy and tariffs,” he explained.

Forecasts from Britain’s Office for Budget Responsibility show that Brexit will reduce the country’s long-term productivity levels by 4% compared to remaining in the EU.

(Reporting David Milliken; Claude Chendjou)

Copyright © 2025 Thomson Reuters