Understanding the UK with Professor Menon

On Thursday 6 February, Canning House hosted a roundtable with Professor Anand Menon that provided an audit of the current state of the United Kingdom. Professor Menon is a foreign policy academic at King's College London and the Director of the academic think tank UK in a Changing Europe (UKICE). He provided insight for a selected, senior Latin American audience into the state of the nation, giving a briefing on the significant impact on the UK economy of Brexit, and the idiosyncrasies of the UK political system.

For Professor Menon, a firm grasp on the UK’s current economic situation required an understanding of the consequences of Britain's exit from the European Union. Overall, he reflected that Brexit would have a slow burn impact on the UK economy, characterised by a decrease in goods trade and investment. At the same time, as one guest highlighted, there are increased pressures on the labour market, with higher unemployment possibly looming.

However, in the context of the UK’s relationship with Latin America, some attendees believed Brexit has potential; freedom from the EU’s cautious approach to regulation on emerging technologies could allow the UK to position itself as an industry leader in new markets. In combination with the uncertainty created by a Trump presidency, there is an opportunity for the UK to increase its interaction with Latin American markets by extending an offer as a business-friendly economy.

Professor Menon was keen to express that much of the current situation is a product of the UK’s political system. The UK’s high tax burden and public spending commitments leave little room for fiscal manoeuvre. Simultaneously, Menon pointed to a shortage of candour amongst politicians about tax, and a lack of transparency about policy trade-offs, which have helped to create low levels of trust in politics.

A salient point of the discussion was the fragile nature of the government’s majority: it is based on a precariously small share of the votes. This has created a large number of marginal seats and voters that cannot be taken for granted. The professor predicted that this will create an increasingly fragmented party system.

Canning House is grateful to Professor Anand Menon for joining us and delivering such an informative and engaging session, and to our guests for their stimulating contributions.