Possible 'Brexit' could be catastrophic for the UK
In the run up to the UK elections on 7 May, British Prime Minister, David Cameron, has again been promising that he will push for a referendum on the UK’s EU membership, which could lead to a possible, “Brexit.”
A study conducted by two leading German institutes noted the risks for Britain in the case of this scenario. A possible “Brexit” could knock up to 14 percent off its gross domestic product by 2030, taking into account all negative factors including lost economic dynamism, the study by two institutes found.
Based on 2014 values, Britain's GDP could be 313 billion euros (£224 billion) lower - or 4,850 euros per capita - by 2030 in a worst-case scenario, the study released on Monday by the Bertelsmann Foundation and Ifo economic research institute said.
Under more favourable circumstances, such as Britain forging free trade agreements with the EU from outside the bloc, real per capita GDP could end up between 0.6 percent and 3 percent lower, or between 220 to 1,025 euros per capita.
"The bottom line is that everyone involved would lose economically and politically from the UK leaving the EU," the study by the two respected German institutes concluded.
The findings portray a more dramatic 'Brexit' scenario than that forecasted last month by the Open Europe think tank. It predicted Britain's GDP falling by 2.2 percent by 2030 if it were to leave the EU.