A cabinet minister has conceded Brexit and the subsequent political turmoil under the Conservatives has dealt a heavy blow to efforts to attract investment to the UK.
Work and Pensions Secretary Mel Stride accepted on Tuesday that creating “frictions” between Britain and the European Union will have had an impact.
His concession came after Paul Drechsler, chairman of the UK International Chamber of Commerce, said Labor is now winning the business argument.
Drechsler, who was a skills adviser to former Tory prime minister David Cameron, blamed Brexit and the chaos that followed for reducing companies’ willingness to invest in Britain.
Asked about the businessman’s comments, Stride told the BBC’s The World At One programme: “I think if you have a situation where you create friction between yourself and your main business partners, I think you have to accept that that will have an impact. ”
Stride, who voted to Remain in the 2016 referendum, admitted it was “taking a bit of time” to benefit from the trade opportunities of Brexit, but added: “They’re pulling through, you can see them pulling through.
“We’ve made progress now and I accept that and I can’t argue now that there aren’t great opportunities, what we need to do now is go out and capitalize on them and that’s what we are determined to do.”
His comments also come amid concerns from prominent Brexit supporters about a “secret” summit attended by Cabinet minister Michael Gove seeking to address Brexit challenges.
Downing Street suggested that Rishi Sunak did not know in advance that Gove would be attending and the prime minister insisted that he is focused on the benefits of Brexit.
Britain is struggling with high inflation rates and the International Monetary Fund has predicted that it will be the only G7 nation, including Russia, to see its economy shrink this year.
Bank of England policymaker Jonathan Haskel has said Brexit caused investment in UK companies to stagnate and led to a £29bn worth of productivity penalty.
Drechsler, the former head of the Confederation of British Industry, blamed former Prime Minister Boris Johnson’s threats to break international law over Brexit and his illegal prorogation of Parliament as one of the problems preventing companies from investing in Britain.
“If there was one thing that could be depended on in the UK for centuries it was adherence to the rule of law, but in the last few years we have prorogue Parliament, we have rejected the international treaties we have just signed,” he said. saying.
“We have spoken of our judges as enemies of the people and now we are about to scrap thousands of EU laws with no alternative that companies can trust.
“It is evident that the trend up to 2016 has changed significantly in the last six years.”
He said companies are “struggling” to employ people with the right skills for the jobs.
“That is a self-created obstacle to economic growth,” he said.
He said Mr Sunak’s conservatives are “incredibly fragmented, incredibly divided and don’t have a brilliant narrative to attract investment.”