Scarica What if Britain Exits the EU: Economic Consequences and Challenges - Prof. Anzalone e più Appunti in PDF di Lingua Inglese solo su Docsity! What if...? The consequences, challenges and opportunities facing Britain outside the EU According to Open Europe's comprehensive new report, UK GDP could be 2.2% lower in 2030 if Britain leaves the EU and fails to strike a deal with the EU or reverts into protectionism. In a best case scenario, under which the UK manages to enter into liberal trade arrangements with the EU and the rest of the world, whilst pursuing large-scale deregulation at home, Britain could be better off by 1.6% of GDP in 2030. However, a far more realistic range is between a 0.8% permanent loss to GDP in 2030 and a 0.6% permanent gain in GDP in 2030, in scenarios where Britain mixes policy approaches. What if there were a Brexit? In this study, Open Europe primarily examines the economic impact of Britain leaving the EU. However, given that Brexit comes down to a finely balanced calculation, unquantifiable considerations such as lost sovereignty and democratic accountability may be what in the end determines whether Britain remains a member. Open Europe’s study draws on detailed economic modelling, showing that the economic impact of Brexit is not as clear cut in either direction as most previous analyses have suggested. Instead it will depend on a number of tough decisions in the UK and Europe. This includes whether the EU itself will embrace reform and British politicians and voters are willing to accept ambitious deregulation and new levels of competition through expansion of free trade. The tough choices facing Britain outside In none of our scenarios would the cost of leaving the single market and the EU customs union be off-set by merely striking a new trade deal with the EU. Britain will only prosper outside the EU if it is prepared to use its new found freedom to undertake active steps towards trade liberalisation and deregulation. It faces a series of difficult choices: Beyond the border: Opening up the UK economy to trade with the rest of the world – including the USA, India, China and Indonesia – is essential to economic growth post-Brexit. However, this would mean exposing UK firms and workers to whole new levels of competition from low-cost countries, and would therefore be politically very sensitive. On the border: In order to be competitive outside the EU, Britain would need to keep a liberal policy for labour migration. However, of those voters who want to leave the EU, a majority rank limiting free movement and immigration as their main motivation, meaning the UK may move in the opposite direction. Behind the border: EU rules have largely been incorporated into UK law, and would remain in force until the UK Parliament decided to amend or scrap them. Outside the EU, we estimate that a very liberally inclined UK government could in theory cut the cost of the most burdensome EU regulations by an amount equivalent to between 0.7% and 1.3% of GDP. However, on current evidence, Britain is likely to keep many of these EU rules, for example on climate change where it has gone further than the EU standard. The choices for Europe The economic advantages and disadvantages of Brexit will depend to a large extent on the future relative economic dynamism of the EU. If it manages to overcome its current economic problems, and liberalises internal and external trade, then the cost of Brexit relative to remaining within the EU will be higher. Brexit is unlikely to be the cataclysmic event some have claimed. However, transforming Britain into the deregulated, free trading economy it would need to become outside the EU sounds easy in theory, but in practice could come up against some serious political resistance within the UK itself. The worst scenario is if the UK leaves the EU and then pursues protectionist policies. If the UK
