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UK Government May Need to Borrow $65Bln to Boost Post-Brexit Economy

© AFP 2023 / Justin Tallis A businessmen walks past the entrance to a HSBC bank branch in London (File)
A businessmen walks past the entrance to a HSBC bank branch in London (File) - Sputnik International
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Additional UK government investment in infrastructure is the "best type of fiscal response" to falling growth, as the country will have a "sharp slowdown" in growth in 2017, according to the report of UK-based multinational banking and financial services company HSBC.

Pro-Brexit flags fly from a fishing boat moored in Ramsgate on June 13, 2016. - Sputnik International
Brexit Backlash: Post-EU Economic Damage Set to Outweigh Modest Gains
MOSCOW (Sputnik) — The UK-based multinational banking and financial services company HSBC said Monday that the UK government might need to borrow $65.4 billion more than it had initially planned in an effort to support the economy in the wake of the Brexit vote.

The report authored by HSBC economists Simon Wells and Liz Martins, and which was obtained by The Financial Times newspaper, said that additional UK government investment in infrastructure is the "best type of fiscal response" to falling growth, as the country will have a "sharp slowdown" in growth in 2017.

A member of public flies a giant Scottish Saltire flag outside the Houses of Parliament shortly before Scotland First Minister Nicola Sturgeon posed with newly-elected Scottish National Party (SNP) MPs during a photocall in London on May 11, 2015 - Sputnik International
Sturgeon Announces $130Mln Stimulus Package for Post-Brexit Scottish Economy
The United Kingdom faces a "choice between enacting near-term economic stimulus at the possible cost of storing up problems for future governments or taking near-term economic pain and the potential for higher future prosperity," the report concludes.

On June 23, the United Kingdom held a referendum to determine whether or not the country should leave the European Union. According to the final results, 51.9 percent of voters, or 17.4 million people, decided to support Brexit, while about 16.1 million opposed it. In the fallout from the referendum result, the UK pound plunged around 10 percent against the dollar, falling from $1.48 per pound to around $1.3 per pound, its lowest level since 1985.

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