Jeremy Corbyn: Theresa May set to launch '˜trade war' with EU

Labour leader Jeremy Corbyn. Picture: John Devlin

With speculation mounting that the Prime Minister will announce the UK is to leave the single market, the Labour leader said she was pursuing an “extremely risky” strategy.

He sharply criticised a warning by Chancellor Philip Hammond the Government could retaliate by slashing corporation tax if UK firms faced new tariff barriers outside the EU.

“It seems to me a recipe for some kind of trade war with Europe in the future. That doesn’t really seem to me a very sensible way forward,” he told BBC1’s The Andrew Marr Show.

He said the Prime Minister’s negotiating strategy risked damaging British exporters.

“She appears to be heading us in the direction of a bargain basement economy on the shores of Europe where we have low levels of corporate taxation, we will lose access to half our export market,” he said.

“It seems to me an extremely risky strategy. There needs to be more discussion, more consultation and recognise that there is a close co-operation with Europe that is going to have to continue when we are outside the EU.”

Mr Corbyn confirmed that Labour would not seek to block the Government from triggering Article 50 - marking the start of the formal two-year negotiating period - but indicated it could seek to ally with MPs from other parties in the Commons to influence what shape Brexit takes.

“The Brexit vote isn’t a one-off thing. It has got to be agreed by 27 national parliaments, it has got to be agreed by the European Parliament. There is quite a long way to go on this,” he said.

“It is going to have to keep coming back to the House of Commons and we will make sure it does keep coming back to the House of Commons. We will keep on pressing the Government on this.

“There are MPs in all parties that must be concerned about the future of industries in their constituencies, must be concerned about the future trade relationships we have.”