Brexit has cost the UK £140bn so far, according to a new analysis. The new report predicts the country may be worse off by £311bn by the middle of the next decade, Sky News reports.
Economists and analysts at Cambridge Econometrics, commissioned by London Mayor Sadiq Khan, modelled the country’s economy if it had not quit the EU. This was compared with data published by the Office for Budget of Responsibility in March 2023 and projections based on that data.
According to the report’s findings, the country faces slowing economic growth, declining employment, a strong negative impact on investment, falling imports, and a widening gap between London and the rest of the UK.
Cambridge Econometrics reports that the UK’s gross value added (GVA) in current circumstances was £2.207bn in 2023 and is estimated to be £2.771bn by 2035.
However, without Brexit, UK GVA could reach £2,347 billion in 2023, with £3,082 billion by 2035, the organisation found. This equates to GVA in 2023 being 6 per cent lower than it would have been without Brexit, and 10.1 per cent lower in 2035.
The researchers found that by 2035, the UK is expected to have three million fewer jobs, 32 per cent less investment, five per cent fewer exports and 16 per cent fewer imports than it would have had if the UK had not left the EU.
The E3ME forecasting model was used to estimate the UK economy within the EU. It included data from the UN, OECD, World Bank, IMF, the ONS and Eurostat.
The experts tried to “isolate and subtract the Brexit effect” from factors such as trade and investment in the main scenarios. They considered options “effectively modelling a scenario in which other factors (eg, the COVID-19 pandemic and the war in Ukraine) took place but Brexit did not.”
Shyamoli Patel, principal economist at Cambridge Econometrics, stated:
Our study reveals that London’s economy would have grown faster if Brexit hadn’t taken place. Looking ahead, we project that Brexit will continue to have an impact on the UK and London economies in the medium term.
The Mayor of London is set to use the report to justify the need for closer relations with Europe on Thursday night at Mansion House. Khan is likely to state that “it is now obvious that Brexit isn’t working.
“The cost of Brexit crisis can only be solved if we take a mature approach and if we are open to improving our trading arrangements with our European neighbours. I agree with the shadow foreign secretary [David Lammy], who has said we urgently need to build a closer relationship with the EU.”
Brexit will be the subject of heated debate and attacks on Labour Party leader Keir Starmer, who backed a second referendum, ahead of the general election.
