A European Union flag flies in front of Union Jack flags in London, Britain, September 13, 2017. REUTERS/Hannah McKay
AMSTERDAM - 12 October 2017: A disorderly Brexit could hit Dutch GDP twice as hard as previously estimated while decimating Britain’s economy, Rabobank said in a study published on Thursday.
Britain leaving the European Union in March 2019 without a replacement trade deal would trim as much as 4.25 percentage points off the Dutch economy by 2030, the Dutch bank estimated.
Dutch economic forecaster CPB last year calculated the loss in that scenario at up to 2 points of GDP.
In Britain, meanwhile, a hard Brexit would slash the economy by up to 18 points by the same date, Rabobank said in the 17-page study.
Given the many uncertainties still in play, banks have generally been wary of trying to quantify the impact of Brexit.
But there is a consensus that a divorce with no trade deal would spook financial markets, tarnish London’s reputation as one of the world’s top two financial centers and sow economic chaos across the region.
Rabobank estimated the loss for the Netherlands in the worst-case scenario would be 4,000 euros ($4,750) per worker by 2030, and 13,500 euros per British worker.
A “soft” Brexit incorporating trade deals would knock up to 3 percentage points off Dutch GDP, the bank said, again a less optimistic scenario than CPB’s estimate of 1.2 points.
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