Press

Brexit and the pandemic have reduced the size of the UK economy by 5.2 per cent compared with its peers, according to research that largely blames Britain’s exit from the European Union for stunted growth.Analysis from the Centre for European Reform think-tank found that Brexit was the main driver of weakening growth, falling goods exports and chronically low business investment.Using a model comparing the UK with similar countries to provide a shadow economy as a point of reference, the analysis concluded that Britain’s GDP was £31 billion, or 5.2 per cent, lower than its “doppelganger” at the end of last year.

Brexit is “largely to blame” for billions being lost in trade and tax revenues in recent years, according to a new study by top economists.The Centre for European Reform (CER) said that by the end of last year, Britain’s economy was 5.2 per cent – or £31bn – smaller than it would have been without Brexit and the Covid pandemic.“We can’t blame Brexit for all of the 5.2 per cent GDP shortfall …. but it’s apparent that Brexit is largely to blame,” said John Springford, author of the CER study.

It comes as research from the Centre for European Reform (CER) showed that by the end of last year the UK’s economy was 5% smaller than it would have been had we still been members of the European Union. CER’s figures showed that this amounted to around £31 billion.

The Centre for European Reform (CER) has modelled the economic performance of a UK that remained in the EU - using data from countries like the US, Germany, New Zealand, Norway and Australia - whose performance was similar to ours before Brexit.It then compared this with the real performance of the UK economy since the referendum six years ago.

“There may be a misplaced hope that if he leaves, his replacement will make things easier with Brussels,” says Camino Mortera-Martinez, the head of the Brussels office at the Centre for European Reform. “Some think things cannot be worse, but they could. Johnson’s handling of Brexit has been amoral. But for all his misadventures, we should be careful what we wish for.”

“Central-bank-issued digital currencies run the risk of turning into a costly waste of time, according to the Center for European Reform. Europe — one of the most advanced economies considering the initiative — should instead use regulation to make payments cheaper and more competitive, the London-based think-tank said Tuesday in a report.

Zach Meyers, a senior research fellow at the Centre for European Reform, said that the speed of the agreement reflected EU lawmakers' increased "willingness to act quickly in setting digital policy, even when introducing requirements that have little global precedent."

“There’s been a huge trust gap between central and eastern European countries and France and Germany,” who are seen as soft on Russia, said analyst Luigi Scazzieri of the Centre for European Reform.

“This is a purely political decision to send a message of European unity,” Camino Mortera-Martínez, a senior research fellow at the Center for European Reform in Brussels, said of deal announced Wednesday by the European Commission. “Nothing has changed except for the fact that there is war going on.” She added: “Rule of law is a major victim in this conflict.”