UK ‘faces 250bn hit’ outside EU
THE UK economy could face a £250bn hit in lost trade if the country votes to leave the European Union, Remain campaigners have claimed.
The Britain Stronger in Europe analysis published today suggests that trade to the European Union would be £224bn lower if there was no deal in place after a Brexit.
There would also be a £9bn fall in trade with the wider European Economic Area and £14bn in lost trade with countries which have deals with the EU. The figures suggest what might happen if the UK is outside the single market and relies on World Trade Organisation (WTO) rules – although Brexit campaigners insist they would be able to strike a preferential deal with the EU after a Leave vote.
Former chancellor Lord Alistair Darling said the analysis showed that leaving “would put jobs, low prices and financial security at risk”.
The figures draw on Treasury analysis of the “EU effect” on the UK, which suggests that trade with EU countries is 76 per cent higher than it would have been outside the bloc. For the EEA the figure is 44 per cent higher and for countries the EU has a free-trade deal with the figure is 17 per cent higher.
The Remain camp applied the “EU effect” to the trade figures from 2014 to calculate the benefit of EU membership, and therefore the amount which could be at risk if the country votes to leave on June 23.
Lord Darling said: “Those wanting to leave the EU want to pull Britain out of the single market, which would mean introducing tariffs and barriers to our trade and putting billions of vital trade at risk. The choice is between free trade within the EU’s single market of 500m consumers, or spending years negotiating new trade deals only to leave us in a weaker position than we enjoy today. Leaving the single market would be catastrophic for our businesses and our families who would be paying more and suffering from a weaker economy.
“There is no trading arrangement outside the EU which gives us the free trade we rely on today.
Leaving would put jobs, low prices and financial security at risk.”
Vote Leave chief executive Matthew Elliott questioned the figures used by the Britain Stronger in Europe (BSE) campaign and repeated his claim that the UK would “stop sending Brussels” £350m a week – a sum which does not take into account Britain’s rebate. He said: “BSE can’t even be consistent or honest in their campaign to do down the British economy.
“Their underlying belief appears to be that Britain – the world’s fifth largest economy and a nation with a great history of trading across the globe – would be an economic backwater if it wasn’t for Brussels taking control of our trade deals. That’s absurd.
“After we vote Leave we will take back control of the powers we’ve surrendered to EU bureaucrats and stop sending Brussels £350 million a week. ”
A separate study has suggested UK employers have a “significant” reliance on workers from the European Union, especially in manufacturing, accommodation and food services. EU employees are generally educated to a higher level than UK-born staff, with only 15 per cent having left formal education before the age of 17 compared with 44 per cent of those born in this country, it was found. EU employees represent five per cent of occupations such as managers, directors and professionals, although high numbers also work in jobs requiring no formal qualifications according to research by the Social Market Foundation and Adecco.