Andrew Bailey believes the UK needs European allies amid the rivalry between the US and China.
LONDON – Andrew Bailey, Governor of the Bank of England, has called for the restoration of the United Kingdom’s trade ties with Europe, arguing that Britain needs allies in a world increasingly dominated by rivalry between superpowers.
Speaking at a BOE conference on Friday, Bailey said the UK, as an open economy, remains vulnerable to shifts in the global order.
He noted that the influence of multilateral institutions is weakening while competition between the United States and China continues to intensify both economically and strategically, according to Bloomberg.
“Because we are an open economy, we need allies and I think efforts to rebuild trade relations with Europe are a sensible step,” Bailey said.
“Maintaining and supporting multilateral structures is extremely important for us. Without them, the world would become far more difficult, especially for the United Kingdom.”
Bailey’s remarks come as the Labour Party government seeks to strengthen ties with the European Union amid criticism over the economic impact of Brexit.
Several media reports suggest Prime Minister Keir Starmer is set to outline new measures to reset relations with the European Union in a speech next week, following poor local election results that have increased pressure on his leadership.
Discussing Brexit’s economic impact, Bailey referred to the ideas of Scottish economist Adam Smith, who emphasised the importance of free trade as a driver of economic growth.
“We learned from Adam Smith about the relationship between trade and growth, so let us not forget that,” Bailey said.
He also renewed calls to strengthen multilateral institutions such as the International Monetary Fund and the World Trade Organization, both of which have recently faced challenges from the administration of US President Donald Trump.
“Without those structures, I think the world would be in a far more dangerous place,” Bailey said. “We must give the IMF the confidence to speak truth to power.” (DK/LM)
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