Research

Brexit has depressed UK exports to the EU by 12%, and rejoining the customs union would undo only a fraction of the damage, research shared with the Guardian shows. With the UK’s future relationship with the bloc likely to feature prominently in a potential Labour leadership contest, the economists John Springford and Anton Spisak, of the Centre for European Reform, provide fresh evidence of the damage caused by exiting.

Brexit also triggered what John Springford, another economist, calls “an investment strike”. For decades, Britain has nearly always had the lowest capital investment in the G7. Brexit uncertainty compounded this, causing investment to flatline for six years.

Bijušais Lielbritānijas vēstnieks Latvijā, domnīcas "Eiropas Reformu centrs" vadītāja vietnieks Īans Bonds atzīst, ka zaudējums valstij ir tas, ka Londona nebija pie sarunu galda svarīgu sarunu vai lēmumu pieņemšanas laikā.

 
John Springford, of the Centre for European Reform, said: “The investment strike started in 2016 and continued through to 2021-22, and then it started to rise again once certainty about the trading relationship had been established.
“That has an impact on productivity. It means workers don’t have the best kit, and existing capital [equipment and buildings] is deteriorating, so you certainly assign some of the GDP losses to that.
“Brexit is more a story of stagnation, and a slow puncture, than of recession and rising unemployment.”

John Springford, associate fellow at the Centre for European Reform think tank, found that a model version of Britain — 31 per cent America, plus some Germany, Australia and others — was 5 per cent richer than actual Britain by 2022. 

Another report furthering the debate is the Centre for European Reform report, China Shock 2.0: The Cost of Germany’s Complacency, released in May.It highlighted that China’s overall export volumes are growing at more than twice the speed of global trade, and called for a strengthened European Union toolbox to defend key sectors, including chemicals, batteries, clean tech and semiconductors.

Nowhere is the new China shock reverberating globally “more consequential than in Germany,” Sander Tordoir and Brad Setser argued in a Center for European Reform report in May, but it is a problem of Berlin’s own making. 

John Springford, a fellow at the Centre for European Reform, has estimated that by mid-2022 Brexit had shaved five per cent off the UK’s GDP and reduced over-all trade by ten to fifteen per cent. The hit to trade would be especially painful for Switzerland, which has an export-dependent economy.  
“You’re competing with other European countries to bring in labor,” Springford said. “That’s quite difficult. Migrants respond to those kind of incentives.” Nearly three-quarters of new doctors in Switzerland were trained outside the country.