What’s the story?
The UK could receive an £80 billion boost if it leaves the European Union without a deal and reverts to World Trade Organisation terms. Read more in i News.
UPDATE: Jacob Rees-Mogg is now claiming a no-deal Brexit would boost the UK economy by £1.1 trillion over the next 15 years. Read more in the Telegraph
How reliable is the story?
Rubbish. Economic forecasts overwhelmingly predict a significant hit to the economy if the UK leaves without a deal, not a ‘Brexit dividend’.
What’s the background?
A research paper from Economists for Free Trade and backed by the European Research Group, comprised of Eurosceptic Conservative MPs, claims that the UK will get an £80bn boost over 15 years from leaving the EU without a deal. Evidence
Although the groups prefer a Canada-style Free Trade Agreement, they argue that reverting to WTO rules will provide an economic stimulus to the UK, increasing customs revenues by £13 bn a year. Evidence
However, no other body has claimed that a no-deal Brexit would benefit the UK; the International Monetary Fund predicted a no deal would cost the UK 4% of its GDP. Evidence
Meanwhile, the Organisation for Economic Co-operation and Development (OECD) predicts a 5.1% hit to GDP over the next 15 years, London School of Economics predicts a 9.5% hit, and the government’s own Brexit analysis predicts that the UK will lose 10.3% of GDP. Evidence
Moreover, if the UK reverts to WTO rules, customs checks and tariffs will be introduced overnight, adding to the cost of everyday products such as cheese, where tariffs are up to 44%, chicken, at 22%, and apples at 15%. Evidence
- Although not all tariffs will be passed onto the consumer, prices are still predicted to rise by roughly 10%. Evidence
This Behind the Headlines Briefing was first published on the DoorstepEU app: http://www.richardcorbett.org.uk/app