Director’s Cut: The economics of no-deal Brexit
Bruegel director Guntram Wolff is joined by senior fellow Zsolt Darvas to rake through the possibilities and probabilities inherent in a no-deal Brexit scenario, covering trade, the Irish border, citizens' rights and the EU budget.
Bruegel senior fellow Zsolt Darvas joins Guntram Wolff for this Director’s Cut, to discuss the economic fall-out of a no-deal Brexit.
While the UK remains without an agreement on the nature of its relationship with the EU beyond March 29th 2019, the possibility of a no-deal Brexit – and its bundle of complex permutations for each sector – is still on the table.
What would a WTO-based trade relationship between the EU and the UK look like in reality? Beneath surface-level tariffs, the value chains that would be broken by a hard border in the English Channel could have far-reaching consequences. And in Ireland, the more innovative border solutions remain mostly unsubstantiated, and at the very least would require a long implementation period – the time for which has long since passed.
A no-deal Brexit also has implications for the EU budget. Our calculations specify the gap to be filled if the UK were to stop contributing immediately, as well as the spread of the additional burden across the EU’s member countries.
For further reading on this subject, consider Guntram Wolff’s Policy Contribution on how well prepared the EU might be for a no-deal Brexit scenario, as well as Zsolt Darvas’ full breakdown of the implications for the EU budget of the UK ‘crashing out’ of the union.