Brexit was a 'historic economic mistake', says former US Treasury chief

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Brexit was a "historic economic mistake" that helped fuel high inflation in the UK, says former US Treasury chief Larry Summers.

The senior US economist also said he would be "very surprised" if Britain avoided a recession in the next two years.

Mr. Summers said Brexit and other policies mean Britain's economic difficulties are "frankly more acute than they are in most cases". other major countries."

"UK economic policy has been seriously flawed over the past few years," he told Britain's Today program. BBC Radio 4.

“Brexit will be remembered as a historic economic mistake that reduced the competitiveness of the UK economy, put downward pressure on the pound and upward pressure on prices, limited imports of goods and limited in some ways the supply of labor,” he said. "All of this has contributed to higher inflation."

Mr. Summers - who advised Presidents Bill Clinton and Barack Obama - also criticized the Bank of England, suggesting that interest rates had been kept too low for too long.

He said the Higher inflation levels were "reinforced by very misguided monetary policies that have been significantly too expansionary for too long".

The US economist said the only option was to hold the course with base rate increases. The Bank of England has raised rates 12 times since the end of 2021, taking them to 4.5% last month.

Mr. Summers said this would inevitably affect activity and growth, adding that he would be "very surprised if two more years go by without the UK going into recession."

Brexit was a 'historic' mistake that hurt the UK, says Larry Summers

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"I think it's a particularly dire concern in the UK that you have very significant entrenched inflation, it's going to be very difficult to eliminate that entrenched inflation without a significant slowdown in the economy," Mr Summers said.

He added: "Usually when you are prescribed medication, even though the medications are not so pleasant on their own and even though they may have side effects, i. . .