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07 February 2018, 12:54 | Austin Hogan
London's economy is the only one forecast to rise in all scenarios
And it comes as Theresa May's top team is already divided over whether the United Kingdom should stay in some form of customs union - which allows us to trade with the EU tariff free, but could harm our chances of striking new trade deals around the world.
Both David Davis, the Brexit secretary, and Liam Fox, the trade minister, have come out against remaining in the EU customs union.
"The conditions are clear, very clear".
The European Union will be able to punish Britain for breaking the rules of its post-Brexit transition period under plans agreed by Brussels on Tuesday, EU sources said. "Our negotiating team starting straight away - tomorrow certainly - on an intensive period of negotiation, and we are confident that we can get that political agreement at the March Economic Council".
Being in a customs union restricts Britain from conducting trade deals with other countries as it would have to apply EU tariffs on any country that doesn't already have an EU trade deal in place.
Britain laid its cards on the line on Monday by declaring it could not remain in the EU customs union after leaving the block next year in a significant victory for hardline pressure for an independent trade policy.
"My feeling is that we have not a minute to lose because we want to achieve a deal", Mr Barnier declared on arrival in the British capital.
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British Prime Minister Theresa May speaks at the China-UK Business Forum in Shanghai on February 2, 2018.
The sides should progress by October in producing a joint report, transition period and the future relationship, Barnier said.
The claims in the Telegraph are set to spark another Cabinet row with the Brexiteers pushing Theresa May to not accept rules from Brussels after the end of Article 50. "We are 19 months since the referendum, we are nine months to go and we still don't know what it is we want". Indeed, it's also possible that this could mean shipping delays as the admin is done.
Mr Barnier later met with Labour leader Jeremy Corbyn, shadow Brexit secretary Sir Keir Starmer and shadow foreign secretary Emily Thornberry.
But Trade Secretary Liam Fox told Bloomberg: "It is very hard to see how being in a customs union is compatible with having an independent trade policy because we would therefore be dependent on what the EU negotiated in terms of its trading policies and we'd be following behind that". We're now about nineteen months after the referendum, and it's not clear what we want and it's not clear what the European Union will accept.
After a weekend of conflicting statements from government officials, May's office told the Press Association on Monday that it is not their policy to be in a customs union.
Last month at the World Economic Forum in Switzerland, Mr Hammond caused fury among Brexiteers when he suggested Britain's relationship with the European Union might only change "very modestly" after withdrawal.
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