Would leaving the EU (Brexit) be bad for the UK?
Brexit will have a positive impact on the UK fishing industry.
Since the UK would take full control of a natural resource currently harvested by EU boats, it is estimated there’ll be a rise in catch of up to £700m-800m per year and a total boost to the supply chain of around £3bn per year.
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The negative effect of Brexit on the UK’s GDP is smaller than claimed.
Princeton economist, Ashoka Mody, suggests the GDP loss caused by Brexit would amount to £10.5bn, a number which is ten to fifteen times smaller than the figure the Treasury and Bank of England are claiming.
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Brexit has a negative impact on internal UK divisions.
The views of Scottish and Irish nationalists are strengthened, since Scottish independence and Irish unity are presented as a jump into the future with the EU—rather than staying put with a regressive and limiting England.
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Brexit will negatively affect the UK’s GDP.
If Brexit is completed, the UK’s GDP growth rate until 2030 would reduce from 30% to 24%.
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Brexit would cause a recession in the UK economy.
An analysis of the UK Treasury shows that with Brexit, the UK economy would fall into recession with four quarters of negative growth. After two years, GDP would be around 3.6% lower compared with a non-Brexit scenario.
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The post-Brexit free trade would boost UK growth.
A Government study estimated that a free trade agreement with the US would add, at most, 0.3% to economic output. And that trade deals with China, India, Australia, the Gulf countries, and the nations of Southeast Asia would add, in total, a further 0.1%-0.4% to GDP.
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Brexit would negatively affect UK imports and exports.
In 2014, the 27 other EU members accounted for 45% of the UK’s exports and 53% of its imports (ONS, 2015). EU exports comprise 13% of UK national income. These numbers will be affected once the trade barriers are back up.
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Brexit would leave the UK out of EU trade deals.
Being outside the EU means that the UK would not automatically benefit from future EU trade deals with other countries. This would mean missing out on the current US and Japanese deals, which are forecast to improve real incomes by 0.
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The effects of Brexit on the UK economy are not clear, as they are dependent on context.
Studies on how Brexit is likely to affect UK economic performance in the longer term have shown different results, depending on the adopted policies. Conclusions range from a prediction of a boost in output of up to 7%, to a prediction of an 18% decline.
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After Brexit, all categories receiving funds from the EU will be negatively affected.
All those that currently benefit from EU funding would stop receiving funds. This includes businesses, farmers, fishermen, universities and regions.
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Brexit would lead to a reduction in UK consumer prices.
The IFS has estimated that the abolition of all EU tariffs would cut consumer prices by up to 1.2%.
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Brexit will generate higher prices and smaller supplies.
Almost 30% of UK food currently comes from the EU, in particular: 43% of drinks, 21% of fruit and vegetables, 14% of fish and meat. With Brexit, it is likely that some foods will become more scarce and more expensive.
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Brexit would cause a reduction in investments.
The uncertainty surrounding the final decision will deter investments; in addition, there would be the transitional costs – not yet quantified – of shifting to a new regime of trade and investment.
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In the long run, Brexit would lower UK productivity.
Reduced trade lowers productivity; this would translate into a loss of 6.3% to 9.5% of GDP (about £4,200 to £6,400 per household).
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In the worst-case scenario, Brexit would have a negative medium-term effect on the economy.
An analysis of the UK Treasury shows that with Brexit, the UK economy would fall into recession with four quarters of negative growth. After two years, GDP would be around 3.6% lower compared with a non-Brexit scenario.
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The effect of Brexit on UK GDP would not be relevant.
A study based on Paul Krugman’s model led to a different estimation of the effect on UK GDP from rising UK-EU trade barriers: it would be just 0.5% of UK GDP.
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Brexit might have a negative impact on EU internal migration.
The 1.2 million individuals born in the UK but living in other EU member states, or those wishing to work, live or travel in other EU member states, might not be able to do so.
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Brexit would cause a fall in UK incomes.
In the most optimistic scenario, there would be a 1.3% fall in average UK incomes (or £850 per household). In a pessimistic scenario - with larger increases in trade costs - Brexit lowers income by 2.6% (£1,700 per household).
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Brexit has lowered UK productivity.
Since the referendum, Brexit is estimated to have reduced the level of UK productivity by between 2% and 5%. In part, this is probably due to the fact that firms are committing several hours per week of top-management time to Brexit planning.
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Brexit would cause a decrease in migration, thus affecting the economy.
Studies which focused on the impact on migration, have all assumed that net migration to the UK will be reduced as a result of Brexit, leading to somewhere between a 0.2% and 1.6% reduction in GDP.