World Economy
0

UK Should Pay for EU Single Market Access

UK Should Pay for EU Single Market AccessUK Should Pay for EU Single Market Access

German government officials have proposed giving Britain access to the EU’s single market in return for a fee, Focus magazine said on Saturday citing a finance ministry report.

The 35-page report on the potential costs of Brexit to Germany said Britain’s departure from the EU risked “serious economic and stability relevant consequences; effects in particular on the real economy”, Reuters reported.

Ministry officials calculated Berlin would have to pay an additional €4.5 billion ($5 billion) a year into EU coffers as a result of Britain’s departure from the bloc. To mitigate the cost, they floated the idea of charging Britain for access to the single market.

“Such a future financial contribution should be used to alleviate the financial consequences of Brexit (reduction in EU spending or increase in payments for other member states),” Focus quoted the officials as saying. A finance ministry spokesman declined to comment on the Focus report when contacted by Reuters.

Brexit would also put additional strain on German tax and customs officials, as there would be new tax liabilities for products and services bought from British companies, the report said.

No one expects negotiations over Britain’s exit from the European Union to go smoothly over the next two years.

A recent report says Merkel was concerned enough to issue a strong statement to the Bundestag, the lower house of parliament, saying that Britain can work out a new relationship with the European Union only after it leaves.

“I must say this clearly here because I get the feeling that some people in Britain still have illusions—that would be wasted time,” she warned.

“We can only do an agreement on the future relationship with Britain when all questions about its exit have been cleared up satisfactorily,” she added, while pointing out that serious negotiations could not start until after the British elections in June.

Add new comment

Read our comment policy before posting your viewpoints

Financialtribune.com