Brexit 'poison' for European economy

GMT 09:40 2016 Tuesday ,21 June

Arab Today, arab today Brexit 'poison' for European economy

British and European economies
Berlin - Arab Today

A withdrawal of Britain from the European Union would lead to huge uncertainty and loss of confidence, and significantly hurt both British and European economies, warned a leading German foreign trade group on Monday.

"A Brexit would lead to uncertainty and a loss of confidence over years. This is poison for the economy in Great Britain, but also for Europe as a whole," said Anton F. Boerner, President of German foreign trade association BGA.

He argued that if Britain leaves the EU, both side would spend two years to negotiate future economic relations, including issues of access to the European single market and financial sector.

"During this impasse, huge uncertainty will prevail as long as the future economic relations are in limbo. The unproductive transaction costs will increase considerably on both sides," Boerner said, adding that a Brexit would also hurt the German economy, especially the country's automobile, chemical and pharmaceutical sectors.

In 2015, Germany exported goods worth 89.3 billion euros (100.99 billion U.S. dollars) to Britain. With a total volume of 127.5 billion euros in exports and imports, Britain ranked the fifth among Germany's most important trading partners.

Last week, German Ifo economic institute said Brexit was the biggest risk for the German economy currently. In a long term, it would cost the German economy up to 3 percent of gross domestic product (GDP).

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