This is the vote that May postponed in early December — the one she knew she would lose — for a deal that neither Remainers nor Brexiteers, Conservatives nor Labour likes. With the nature of the post-Brexit border between Northern Ireland and the Republic of Ireland still a touchy subject, and the EU’s refusal to negotiate further, it’s unclear whether May’s latest, tweaked proposal will pass.
If it doesn’t, Parliament will have to decide whether to push for a last-minute alternative deal, or allow the U.K. to crash out of the EU in March, which would have a drastic short-term impact on imports, exports, Britons’ ability to travel abroad and a host of other regulations.
There could also be a second referendum, a no-confidence vote in the government – and a new election that could usher in Labour as Britain’s new leaders. There is also talk of a “managed no-deal,” which would temporarily soften the blow of a hard exit, but it’s unclear how long a period of emergency measures agreed by the U.K. and EU could last.
The big banks and consultancies have taken a variety of scenarios into account, and the overall result is grim. Capital Economics offered the best outlook, with a growth forecast of 2.2 percent, and inflation of 2 percent if a version of May’s deal passes in January. The worst outlook is from Fathom: The consultancy is looking at 0.5 percent growth and 2.1 percent inflation. It cited a drop in household spending and companies deciding to freeze investment.
This story was reported by WWD and originally appeared on WWD.com. To read the full story, please go to WWD.com.