World Economy

Hard Brexit to Cost Scots $17.5 Billion a Year

Hard Brexit to Cost Scots $17.5 Billion a YearHard Brexit to Cost Scots $17.5 Billion a Year

A hard Brexit would cost Scotland’s economy £12.7 billion ($17.52 billion) a year, according to a new Scottish government report Monday. It estimates that the Scottish economy will grow at a slower pace than it would if the country stayed in the European Union, with GDP to be 8.5% lower by 2030 than if the UK had remained a full member of the EU.

First Minister Nicola Sturgeon said the document sets out three different Brexit outcomes on GDP, trade and immigration, and indicates remaining in the European single market and the customs union would be the least damaging economically, Business Insider reported.

Sturgeon accused British Prime Minister Theresa May of a “fundamental dereliction of duty” for failing to produce economic assessments on the impact of Brexit since she took office in 2016.

The options analyzed are staying in the single market and customs union, a trade agreement between both parties or reverting to World Trade Organization terms if no Brexit deal is agreed.

The UK government wants to leave the single market for a bespoke trade deal with the EU.

Brexit Secretary David Davis told MPs last month the UK government had not carried out any economic impact assessments of Brexit on the UK. He said “sectoral analysis” of different industries had been drawn up, but not a “forecast” of what would happen after Brexit.

Sturgeon said: “For the sake of jobs, the economy and the next generation, today we are calling on the UK government to drop its hard Brexit red-lines so that Scotland and the UK can stay inside the single market and customs union.

“Scotland is particularly well-placed to take advantage of the developing and deepening single market—the world’s biggest economy of 500 million people, eight times the size of the UK.

Meanwhile, the likelihood of a no-deal Brexit has fallen from 25% to 15%, driven by attitude changes among Eurosceptic MPs and reduced challenges to the prime minister’s leadership, according to JPMorgan.

The probability of the UK crashing out of the EU in 2019 with no deal has reduced in recent weeks, thanks to a “stabilization in support”  for May’s leadership among Conservative party members and the “relatively muted response” among Eurosceptic MPs to the likely terms of a transition period, a research note said on Monday.


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