A pro-Brexit group of economists has claimed Britain will gain £651 billion from a “no deal”, whereas the European Union will lose more than £500 billion.
The Economists for Free Trade group – formerly known as Economists for Brexit – used a classic trade model to predict that GDP will spike by nine per cent, amounting to a one-off gain of £180 billion, if Britain leaves on March 29, 2019, without a deal.
They predict the UK would make an additional £433 billion in tariffs imposed on EU producers if it operated under World Trade Organisation rules, because we import more than we export.
That, plus the £38 billion the UK will have saved by not paying for the two-year transition period, adds up to a total of £651 billion.
Conversely, the cost to the EU would be the loss of the £38 billion “divorce” payment, plus £433 billion in tariffs, plus its balance of trade surplus with the UK estimated to be worth around £36 billion – a total of £507 billion.
Sir Patrick Minford who made the calculation, said: “It could not be more open and shut who least wants a breakdown of negotiations.
“For the UK a breakdown would be a short-term nuisance but a substantial economic gain. For the EU it is both a short-term nuisance and a substantial economic loss.”
Read the report in full here.