By: Alex CurranAs Brexit negotiations continue and the threat of a no-deal Brexit is becoming a real possibility, one question looms: What will happen to the British economy? Also, what is currently happening in the UK’s economy? Although it appears to be smooth sailing, the government is preparing for the worst.Despite being bogged down by endless negotiations, Britain’s economy is actually performing better than comparable European economies. For instance, consumer spending is up and the unemployment rate is at a multi-decade low of 3.9%, compared to the Eurozone’s much higher 7.8%. Additionally, the UK’s annualized growth rate is 1.3%, which is modest, but much greater than other large economies. For instance, France and Germany only have growth rates of 0.9% percent and 0.6% respectively (Constable, “How a Chaotic Brexit”).Part of this outperformance is simply because the government has not been interfering with Britain’s thriving markets. For the past couple of years, the government has been so focused on Brexit that it has not gotten in the way of a flourishing economy.The Central Bank is also taking a backseat, as it has left the key interest rate unchanged at 0.75%. Its members unanimously voted to keep the rate stable, as they believe that the future moves entirely with Brexit (“UK Requests Three-Month Brexit Extension”). This rate has remained the same since August of last year.According to Mike Jakeman, a senior economist at PwC, it would be “inconceivable” for the Bank to raise rates due to the sheer number of possible outcomes to the Brexit process (“UK interest rates on hold”).However, this positive state is not set to last long, as the government is already preparing for the worst. For instance, just this week, the British government announced that in the event of a no-deal Brexit, it would slash tariffs to zero on 87% of imports into the UK and wave checks on goods going across the Irish border (“Fact Check: what will a no-deal Brexit actually mean?).This emergency tariff regime is intended to prevent a £9 billion price shock to businesses and consumers, but has many worried for illegal smuggling across borders. Nevertheless, even with protections, many feel that a no-deal Brexit would cause a “national emergency” and would be “felt by generations to come” (McLaughlin, “Brexit Talks in Turmoil”).Following a no-deal, the UK would have to face such consequences as the EU’s external tariffs and limitations on its exports into EU-bound countries. Citizenship qualifications could also change and many people could be forced to leave either the UK or EU. Another major concern is the fate of the Irish border between Northern Ireland and the Republic of Ireland. With a no-deal, there would be pressure to enforce customs and immigration controls (Sandhu, “What is No-Deal Brexit?”). So, it is apparent that a no-deal Brexit can sink the British economy, but the real question is: Will the UK be able to avoid this metaphorical iceberg? Sources:https://inews.co.uk/news/brexit/no-deal-brexit-what-meaning-uk-leave-uk-consequences/https://edition.cnn.com/2019/03/21/uk/brexit-delay-theresa-may-eu-gbr-intl/index.htmlhttps://www.forbes.com/sites/simonconstable/2019/03/21/how-a-chaotic-brexit-has-been-great-for-britains-economy/#451a73b67bf6https://www.theweek.co.uk/fact-check/95547/fact-check-what-a-no-deal-brexit-really-meanshttps://www.wsj.com/articles/u-k-requests-three-month-brexit-extension-market-talk-roundup-11553165691?mod=searchresults&page=1&pos=3https://www.bbc.com/news/business-47653440https://www.euronews.com/2019/01/15/campaigners-demand-people-s-vote-with-titanic-brexit-stunt