Press

The Bank of England and some independent analysts, including the Centre for European Reform, have suggested that the Leave result has held back UK GDP growth by between 2 and 2.5 per cent relative to where it otherwise would have been due to lower household spending, resulting from the spike in inflation after the vote, and lower business investment due to Brexit-related uncertainty.

Financial Times research has shown that by the end of the first quarter, the UK economy was between 1 and 1.5 per cent smaller than it would have been without the Brexit vote, although some independent estimates, such as a recent report from the Centre for European Reform, suggest the hit could have been as large as 2.5 per cent.

Sam Lowe, a trade specialist at the Centre For European Reform, predicted that the US would want the UK to move away from EU food standards and much closer to its own in any future free trade deal negotiation. “The US actively dislikes many existing EU measures and will certainly pressurise the UK to jettison many of them in any FTA negotiations with the UK,” Mr Lowe told Business Insider.

In London vermutet man hinter Fosters lauter Ablehnung derweil Kalkül. „Meint sie ihr Nein ernst? Anfangs hatte die DUP auch eine Unterstützung der Minderheitsregierung abgelehnt und sich dann doch darauf eingelassen“, erinnert Sam Lowe daran, dass May Nordirland nach der Wahl kurzfristig umgerechnet 1,2 Milliarden Euro Sonderhilfen zusagte. „Nordirland ist in vielerlei Hinsicht nicht in Großbritannien integriert. Etwa in seiner kategorischen Ablehnung der rechtlich verbindlichen Homo-Ehe oder des Abtreibungsrechts. Das Beharren auf die Integrität des Territoriums birgt aber hohe Symbolik, und die ist wichtig für die DUP“, sagt der Handelsexperte vom Centre for European Reform.

The Centre for European Reform’s John Springford has taken the Born-led model a step further. The CER approach uses not just GDP, but also other attributes of 22 advanced economies — including the inflation rate, openness to trade, investment ratio and how well-educated the population is — to create a doppelganger U.K. that most closely matches the country’s economy before the referendum. Based on that methodology, the CER puts the cost of Brexit at 2.5 percent of GDP.

“The member states and the EU institutions want the UK out before the European Parliament elections in late May 2019 and the nomination of a new commission afterwards, or Britain would be obliged to take part. The EU has already agreed to redistribute 27 of Britain’s 73 seats in the European Parliament to other member states. France — one of the hardliners in the Brexit talks — is among the countries that are due to benefit from this redistribution. It is hard to imagine that Paris will be eager to give the UK more leeway.” (Agata Gostyńska-Jakubowska, senior research fellow and Beth Oppenheim, researcher at the Centre for European Reform).

Brexit already costs £500million a week after uncertainty slashed economic growth by 2.5%, according to the Centre for European Reform think-tank.

Sam Lowe, senior research fellow and trade expert at the Centre for European Reform, said, “It is unlikely that anything of substance will be agreed on the future trade relationship before leaving, meaning there will be much left to discuss in the transition.“If there was a clear direction and agreed, set parameters it is possible that the negotiations could be concluded before the transition ends, it seems improbable.”