Reversing Brexit would give ‘significant’ boost to UK: OECD

Secretary-General of the Organisation for Economic Co-operation and Development (OECD), Angel Gurria speaks during a press conference to present the latest Economic Survey of the United Kingdom, in London. (AFP)
Updated 18 October 2017

Reversing Brexit would give ‘significant’ boost to UK: OECD

LONDON: Reversing Britain’s shock referendum to leave the EU would “significantly” boost the economy, the OECD said on Tuesday, while the government inisted there were no plans to cancel Brexit.
“In case Brexit gets reversed by political decision (change of majority, new referendum, etc) the positive impact on growth would be significant,” the Organization for Economic Co-operation and Development (OECD) said in a new report.
The Treasury responded saying: “We are leaving the EU and there will be no second referendum.”
A spokesman for British Prime Minister Theresa May also reiterated the government’s position that there should not be a second referendum, with Brexit due to take place in March 2019.
The OECD meanwhile left its economic growth forecasts for Britain unchanged at 1.6 percent in 2017 and one percent in 2018.
The OECD, which advises industrialized nations on economic policy, said Britain should seek to maintain close economic ties with the European Union to weather the impact of Brexit.
The Paris-based organization warned that a “disorderly Brexit,” one in which no trading relationship was arranged, would constitute a medium-term shock to Britain’s economic growth prospects.
“Business investment would seize up, and heightened price pressures would choke off private consumption,” the organization said.
“Negotiating the closest possible EU-UK economic relationship would limit the cost of exit.”
Britain voted to leave the EU in a shock referendum in June last year.
Speaking to MPs earlier, Bank of England governor Mark Carney blamed a pick-up in inflation to 3.0 percent on the tumbling value of the pound since the Brexit vote, and said that a transition agreement for Britain’s withdrawal from the EU was in “everyone’s interest.”
The country must now “stay calm and carry on,” said OECD Secretary-General Angel Gurria at the presentation of the report.
Asked whether the UK should pursue a longer transition period for exiting the EU, Gurria said: “Common sense was invented by the British — if you need more time then give it more time.”
The OECD also said that Brexit could exacerbate Britain’s existing productivity problem by increasing uncertainty and reducing business investment.
Reviving labor productivity growth was a challenge “compounded by Brexit,” it said, calculating that leaving the EU could reduce total factory productivity by about three percent after 10 years due to reduced trade.
The OECD recommended investment targeted at increasing productivity, such as “spending on repair and maintenance or soft investment” if growth weakens further ahead of Brexit.
British finance minister Philip Hammond said that weak productivity was one of the issues he would focus on when he presented his annual budget on November 22.


Libya’s NOC says production to rise as it seeks to revive oil industry

Updated 22 September 2020

Libya’s NOC says production to rise as it seeks to revive oil industry

  • Libya produced around 1.2 million bpd – over 1 percent of global production – before the blockade
  • Libya’s return to the oil market is sustainable

LONDON: Libya’s National Oil Company said it expected oil production to rise to 260,000 barrels per day (bpd) next week, as the OPEC member looks to revive its oil industry, crippled by a blockade since January.
Oil prices fell around 5 percent on Monday, partly due to the potential return of Libyan barrels to a market that’s already grappling with the prospect of collapsing demand from rising coronavirus cases.
Libya produced around 1.2 million bpd — over 1 percent of global production — before the blockade, which slashed the OPEC member’s output to around 100,000 bpd.
NOC, in a statement late on Monday, said it is preparing to resume exports from “secure ports” with oil tankers expected to begin arriving from Wednesday to load crude in storage over the next 72 hours.
As an initial step, exports are set to resume from the Marsa El Hariga and Brega oil terminals, it said.
The Marlin Shikoku tanker is making its way to Hariga where it is expected to load a cargo for trader Unipec, according to shipping data and traders.
Eastern Libyan commander Khalifa Haftar said last week his forces would lift their eight-month blockade of oil exports.
NOC insists it will only resume oil operations at facilities devoid of military presence.
Nearly a decade after rebel fighters backed by NATO air strikes overthrew dictator Muammar Qaddafi, Libya remains in chaos, with no central government.
The unrest has battered its oil industry, slashing production capacity down from 1.6 million bpd.
Goldman Sachs said Libya’s return should not derail the oil market’s recovery, with an upside risk to production likely to be offset by higher compliance with production cuts from other OPEC members.
“We see both logistical and political risks to a fast and sustainable increase in production,” the bank said. It expects a 400,000 bpd increase in Libyan production by December.
The Organization of the Petroleum Exporting Countries and allies led by Russia, are closely watching the Libya situation, waiting to see if this time Libya’s return to the oil market is sustainable, sources told Reuters.