The closer the 23 June referendum gets, the more expensive leaving the European Union gets, at least if figures from the “Remain” camp are to be believed. Former UK Chancellor of the Exchequer Alistair Darling says that the UK economy will take a £250 billion hit if you and your countrymen vote to leave.
Where did that number come from?
He bases that figure on the difficulty of negotiating new trade deals with the EU and the rest of the world. If Britain were to leave the EU common market, it’s claimed that it would have to negotiate new free trade agreements with all the EU countries it currently trades with. The Remain camp reckons that 60% of total British trade (£673 billion) would be subject to revised trade agreements with EU nations. It then reckons that a third of that trade will… be at risk.
It’s certainly possible that the EU will punish the UK for leaving. The EU itself is in a fight for survival. It needs to make an object lesson of any recalcitrant vassal states. Sending Britain to the woodshed might do the trick.
But the larger question – and the only real one that matters, at least from an economic point of view – is if Britain’s economic interests are best served inside or outside of the EU. That’s it really. Can Britain do better with the rest of the world? Or should it nail its colours to the mast of a low-growth trade zone that’s evolving toward a single currency and central control from Brussels?
Category: Brexit