What are the economic, legal and financial consequences of brexite?
What are the specific economic consequences of Brexit for Britain and the EU? We investigated this in a study using various scenarios. The result: In the extreme case, the gross domestic product (GDP) of Great Britain could shrink by up to 313 billion in the long term, while that of Germany could fall by up to 58 billion. A fact sheet on the study also shows the possible GDP losses.
The legal challenges posed by Brexit are also considerable. We discussed this with the European lawyer Federico Fabbrini. In addition, Brexit represents a significant cut in the EU budget. Our analysis assumes that an annual error of 10 billion euros is to be expected. At the same time, however, the withdrawal of the British could also provide the impetus for a reform of the EU budget.
And what do the entrepreneurs directly concerned think? In a representative company survey we found out in the run-up to the referendum that German and British entrepreneurs see the Brexit very critically.
Brexit inspires EU approval
“Too bureaucratic, distant from citizens and undemocratic’ – the EU is often perceived negatively, not only in the UK, and some clichés are persistent. But the image of citizens is more complex than many people think. This is shown by our regular European-wide surveys from the “eupinions”series. Already at the end of 2016, shortly after the referendum, one of our surveys revealed that the Brexit promotes approval of the European Union – also in Great Britain.
The “eupinions” also show that an issue that also played an important role in the EU referendum in the United Kingdom has a major impact on Europeans’ political attitudes: globalisation and the fears that go with it. According to the survey, skeptics of globalisation are much more critical of the EU and democracy.
Even if the British had stayed in the European Union, cooperation in Europe would have been complicated. The EU reform deal that Prime Minister Cameron negotiated with the other EU countries in February 2016 made it even more difficult, as our analysis of the special agreements shows.
Would you like to learn more about the economic and political consequences of Brexit? Our project “Global Economic Dynamics” regularly writes about this in the blog. In addition, our Brussels office and the Bertelsmann Foundation in Washington D. C. are investigating the topic of Brexit from an international perspective.