NO-DEAL BREXIT TO BLUDGEON UK ECONOMY, EXPERT WARNS
A no-deal Brexit would be twice as damaging for the British economy as coronavirus in the long term, Prof. Jonathan Portes of King’s College London warned in an analysis written for The Independent.
“Our modelling with the London School of Economics of the impact of a no-deal Brexit suggests that the total cost to the UK economy over the longer term will be two to three times as large as that implied by the Bank of England’s forecast for the impact of COVID-19,” Portes maintained.
No deal will result in immediate and substantial tariff and non-tariff barriers on UK exports to the EU, to which 40% of all UK exports goes. And the UK will apply the new UK Global Tariff to imports from the EU and other countries with which it does not have a trade deal. Free movement will also come to an end, he revealed.
A no-deal Brexit may act as a drag on economic recovery after COVID. Both UK and foreign businesses will be seeking to re-establish themselves in international markets and to rebuild their supply chains, with a particular focus on resilience to future health-related disruptions, and perhaps on reducing reliance on China. The risk is that, as they do this, EU-based businesses will seek to avoid UK suppliers, and that multinationals will seek to minimize the degree to which trade crosses the new border.
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