the Lost foreign direct investment, deep 30 billion pounds hole in exports, the decline in GDP by at least 5 points of interest. is the price you can pay UK, when you lose access to the single EU market. – The British are willing to accept the costs of leaving the EU, – says Professor Stanislav Mykola Shaforostov. What this means for the Community and Poles on the Islands?
Prime Minister Theresa may is considering a so-called Brexit drive and are willing to devote British membership in the common market in favor of immigration control. As suggested by the media, on the Islands, officially this position has confirmed Tuesday’s speech.
All 28 countries of the EU are full members of the single market. And all – as well as Norway, Iceland and Liechtenstein (members of European Economic Area) – must accept the free flow of people.
- to Leave the single market across the UK, it seems very likely. The European Commission can not imagine the participation of the Kingdom in it without complying with all four EU freedoms-free movement of goods, services, capital and people. Namely, the immigration case to the British, Professor Mykola Shaforostov, chief economist at the BCC, who for 35 years taught in the Department of Economics London School of Economics.
Despite the fact that still not aware of all the consequences of exit through the UK, European Union structures, is loss of access to 500 million potential consumers is a serious problem for the British economy.
Therefore, the Chancellor of the Exchequer – Philip Hammond believes, however, the agreement with the European and the optimistic scenario of divorce with the Community. In an interview with German newspaper “Welt am Sonntag” he admitted that to leave the single market through the Realm would be a blow for the UK and, of course, in the first period, the economy will continue to suffer.
Impact on trade
If UK will be forced to leave the common market, will pay more for trade with Europe. He told Euler Hermes is the global leader in trade credit insurance trade, leaving the EU via the UK without creating a new free trade Agreement (Free Trade Agreement – FTA) may lead to a black hole in export value of 30 billion pounds over the next three years.
Euler Hermes indicates that potentially can be lost foreign direct investments worth 210 billion pounds (more on this subject we wrote to WP money).
As 55 percent. imports come from the EU, it is expected that Brexit would hurt profits of UK companies, reduce the cost of the pound and the introduction of new import tariffs to increase local production in the EU, like the UK, the report says.
- In all probability UK will incur large costs limited trade with the European Union. This will affect the state of the economy. The British, it seems, however, prepared to accept a fall in GDP of 5 points. percent. and lower growth rates in the next 5 or 10 years, says Professor Nicholas Stanislav Shaforostov.
If not European, then what?
- In case of exclusion from the single market, we may be forced to change our economic model, and we change it, to restore competitiveness, – said Lord Hammond in an interview with “Welt am Sonntag”. He said that the British will not wait idly by.
What does this mean? Maybe the answer will bring Tuesday the Prime May. Scripts may be several. Also, these, which, however, agree on the relocation of the Union.
One of the options under consideration was to confer on migrant earnings the obligation to obtain a work permit, in the form of a specific visa type on the application level that are applied even Australia. In practice, gain will be the only employees qualified for specific sectors of the economy. But this model was rejected by the Prime Minister may, which claimed that there would not be sufficient government control to migration, says “bi-bi-si”.
If London has some concessions, you may apply for the position today are Norway or Switzerland. Then these losses will be much less. Both of these countries remain important elements of the European market – and that’s without EU membership. Norway as a supplier of raw materials and Switzerland as a key transit country. Both, however, agree on the free flow of people.
the Status of the United Kingdom can also regulate, for example, the customs Union, which, as a member of the EU, currently the UK still remains. This system allows you to trade on preferential terms, as well as countries outside of the Community. This solution is used, for example, Turkey.
How to convince the Professor Mykola Shaforostov, even if it came to a complete redemption of the Islands of the common market, Britain could go back to the trading Community of great Britain with which the contracts she had to leave in time to join the EU. – However, contact with most of these countries now play a marginal role, but Canada is a major trading partner – said the expert of the BCC.
the Hand in the direction of the pull of London also the USA. President trump had offered the British increased exports to the US and strengthening cooperation with the UK. Is the market, if we are talking about GDP in the EU without the UK. Such cooperation złagodziłaby costs Brexitu – adds Professor Mykola Shaforostov. However, as noted, the recovery of contact with the Community of the UK that creation of a common market with USA, you need time.
Poles also will pay for Brexit
the Instance of great Britain from the European Union will also have impact on the lives of nearly 900 thousand. Poles living and earning in the United Kingdom. Our people were founded in Britain are still about 40 thousand. companies.
According to the forecasts, Euler Hermes, the deficit in the exports of Latvian goods even reach 700 million euros, that is about 3 billion rubles. Najdotkliwiej feel it food exporters – their losses can reach 100 million euros a year. With similar problems should be considered as manufacturers of ELECTRONICS and home APPLIANCES, household chemicals, furniture, machinery parts and building materials.
- there is No agreement on the single market, without creating a new free trade Agreement will relate mainly to new business, new contracts. The agreement, signed earlier, will not change much, Professor Mykola Shaforostov. It adds Poles who received permanent residence or passport of British influence Brexitu feel like other Britons.
in Addition to possible tax increases, our compatriots on the Islands they have to deal with inflation and drożyzną in stores. According to the Institute of Tax, the government’s decision to freeze benefits and tax credits until 2020. can seriously affect many families who are not able to keep up with the constant rise in prices. To touch 11 million households. Given the current inflation, they will lose 360 pounds per year, and earning a minimum of 470 pounds even.
But the instance of great Britain from the European feel also the whole Community. Analysts are already predicting “curl” in the financial markets, both on the Islands and in the Union as a whole. Case access city of London for the common market may affect financial stability in Europe.
London is one of the financial centers of Europe and calculations in a single currency. Up to 8 percent. UK GDP being developed is the financial sector. It is worth noting that the banks cover is also 3.4 percent. the UK labour market. To leave London and move banks in other cities of the continent for years can lead to fragmentation of the financial services sector. And this weakens the ability of the whole of Europe to compete in the international arena. Read more on this topic, see WP money.
- If London and the EU does not agree, the large financial institutions from the USA, Asia, Africa, will be looking for more stable places for their investments than Europe. If you have decided on the exit from the city, not necessarily means choosing one of the capitals of the Old Continent. If not London, then why not Singapore? asks Jacob Makurat, Director of the Polish division of the British company Ebury.
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