Tears for fears

22 March 2016 By George Hay Follow @gfhay

A UK exit from the European Union could knock 3.9 pct off domestic GDP in 2030, Oxford Economics reckons. As worst-case scenarios go, this and other similar claims just aren’t that terrifying. The Remain campaign will have to do more to convince all but the most rational voters.

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A UK exit from the European Union could knock 3.9 percent off domestic GDP in 2030 compared to trend growth, according to research by Oxford Economics published on March 21.

The research house found that the impact on national output could occur if Britons voted to leave the EU, and subsequently failed to agree a free trade agreement with Brussels, clamped down on migration, and used any savings to expand public services and welfare.

In the mildest of nine scenarios, in which the UK only marginally restricted freedom of movement and formed a customs union with the EU, Oxford Economics found that GDP in 2030 would decline by only 0.1 percent compared to baseline forecasts.

A separate economic study, conducted by PricewaterhouseCoopers for the Confederation of British Industry, and also published on March 21, found that average real GDP per capital in 2030 would be around 25 to 28 percent higher than 2015 if the UK left the EU, against 29 percent higher if the UK stayed in.

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