Brussels, 27/04/2015 (Agence Europe) - A “Brexit” could cost the United Kingdom up to €300 billion, according to the latest study published on Monday 27 April by the Bertelsmann Stiftung and have a significantly lesser effect on the other member states. The study says that the UK's leaving the European Union in 2018 would have long-term negative consequences that will be felt for some twelve years after the decision to leave.
Three scenarios were developed to estimate the range of possible effects, says Bertelsmann. In the most favourable case, the UK would receive a status similar to Switzerland and still have a trade agreement with the EU. In the least favourable scenario, the country would lose all trade privileges arising from EU membership and its free-trade agreements. Depending on the extent of the UK's trade policy isolation, its real gross domestic product (GDP) per capita would be between 0.6% and 3% lower in the year 2030 compared with GDP in 2014. In the most favourable scenario for the UK, GDP per capita would fall by €220.
If trade, economic as well as dynamic economic consequences - such as the weakening of both innovative power as well as London as a financial centre - are taken into account together, the GDP losses in the unfavourable scenario could reach 14% compared with the current level. This would correspond to a GDP that is around €313 billion lower. Possible savings, such as the removal of EU budget payments that currently total around 0.5% of the British GDP, could not compensate for economic losses, even in the best-case scenario.
Leaving the EU would increase the costs of trade between the UK and EU and reduce trade activities, according to Bertelsmann. All sectors of the economy would be affected, with the chemicals, mechanical engineering and automotive industries, which are heavily incorporated in European value chains, seeing steep losses in added value.
The United Kingdom's leaving the EU would also come at a cost for the other member states, though much lower than for the UK. According to the study, Germany could lose between 0.1% and 0.3% of its GDP as a result, for example, of reduced exports to the UK, though this figure could rise to 2% of GDP if it were to lose all trade privileges with the UK. The other member states would also have to make up for the loss of the British contribution to the European budget, Bertelsmann points out. (Solenn Paulic)