According to Reuters, the major EU and UK companies could see a £58 billion increase in annual costs if there is a no-deal Brexit. The UK financial sector set to be one of the hardest hit.
Companies in the EU’s 27 countries excluding Britain will have to pay 31 billion pounds in tariffs if Britain quits the bloc without a deal, the report by Oliver Wyman management consultants and law firm Clifford Chance said. Meanwhile, UK exporters to the EU will have to pay 27 billion pounds a year.
“These increased costs and uncertainty threaten to reduce profitability and pose existential threats to some businesses,” the report by Clifford Chance said.
In case of the absence of an agreement, trade between the UK and the other 27 EU members would be subject to the World Trade Organization’s rules and tariffs.
The UK government is ready to make the deal, but it says it considers any scenario, including the chance that Britain could leave the bloc with no deal. It has allocated 3 billion pounds for the corresponding needs, analysts note.
If Britain retains the status of a customs union, both sides’ costs will be reduced by about 50%, experts say. However, Prime Minister Theresa May excludes this development, as this will prevent the country from making trade deals with fast-growing economies such as China and India.
