Lord Paul Myners, who served under Gordon Brown, said a post-Brexit Britain now appeared “a lot less attractive” to potential investors after Theresa May confirmed that she would be looking to pull out of the single market.
The ex-Marks & Spencer chairman predicted export prices to the European bloc would rocket in the aftermath of the EU divorce.
He told BBC Radio 4’s World at One: “What the Prime Minister has now said is we’re leaving the single market and we’re almost certainly going to leave the customs union.
Lord Myners said investors will turn to the EU instead of the UK
If you’re an international investor or a manufacturer, the UK has suddenly become a lot less attractive as a place to locate your business over at least the next few years
Lord Paul Myners
“And accordingly, if you’re an international investor or a manufacturer, the UK has suddenly become a lot less attractive as a place to locate your business over at least the next few years.
“Who knows over the longer term, but over the next few years exporting products manufactured in the UK or services produced in the UK into the EU is going to become much more expensive and much more complicated.”
Lord Myners said businesses would look to the EU to set up shop in his damning assessment.
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“If you have a choice, if you’ve got to build a factory in Germany or Spain or the UK, the balance is tilted away from the UK and more in the direction of other EU countries,” he added.
The businessman said the Government needed to assess the “economic impact” of Britain’s Brexit deal before suggesting exiting the EU was “more complicated than people thought".
He said: “Corporation tax, value-added tax, pay-as-you-earn income tax will all be lower as a result of these moves taking place, so one of the things which we clearly need to reach is an informed decision, on [whether] the final exit package is a good estimate of the likely economic impact.
“And one of the things we’re beginning to appreciate about the EU is that withdrawal is much more complicated than people thought and it’s going to be much more expensive in terms of the impact on Government revenues.”