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ECB officials doubt 'small country' Britain's post-Brexit future

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The UK won't be able to retake complete control of its destiny though Brexit, European Central Bank Chief Economist Peter Praet said.

[LONDON] The UK won't be able to retake complete control of its destiny though Brexit, European Central Bank Chief Economist Peter Praet said.

"It's kind of dishonest to say 'I can regain control,'" he said at a conference in London on Thursday.

"It's an interconnected world and small countries know that. The UK is a small country."

Pro-Brexit campaigners argued last year that withdrawing from the EU would let the country "take back control" of immigration and government budgets.

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Prime Minister Theresa May plans to initiate formal talks to leave by the end of March, kicking off two years of negotiations to decide new relationships for trade and financial services.

Mr Praet, a Belgian, said that there will certainly be more friction in trade when Britain leaves the bloc, and though he's optimistic, "things can turn nasty very quickly". He also said that financial stability is always fragile and that regulators will have to be vigilant.

"Regaining control as a nation state in a multilateral environment is extremely complicated," Mr Praet said.

"It's an illusion."

And Bundesbank President Jens Weidmann, speaking in Frankfurt, called into question the closeness that any bilateral trade deal between the EU and the UK can recreate.

"It is probable that the UK will be less closely connected through trade with the EU than Norway, which at least is part of the European Economic Area, or Switzerland, which has bilateral agreements with the EU," he said.

"Open markets and a competitive economic order are the pillars upon which our prosperity rests."

Separately, Austrian Chancellor Christian Kern said in a Bloomberg Television interview that Britain's bill for leaving the EU "is for sure going to be very costly", highlighting how tough the negotiations might become.

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