UK economy could shrink by 6% in case of Brexit, Treasury says

UK economy could shrink by 6% in case of Brexit, Treasury says

PanARMENIAN.Net - If Britain leaves the European Union its economy could shrink by six percent by 2030, the finance ministry warned in a report on Monday, April 18 that was dismissed as scaremongering by eurosceptics, AFP reports.

The report said a Brexit would cause "permanent" economic damage as Britain would never be able to negotiate quota-free, no-tariff access to the single market if Britons vote to leave in a June referendum.

"The conclusion is clear: for Britain's economy and for families, leaving the EU would be the most extraordinary self-inflicted wound," Chancellor of the Exchequer George Osborne wrote in The Times.

"There would be less trade, less investment and less business... Leave the EU, and the facts are: Britain would be permanently poorer," he said, according to AFP.

Under all the Brexit scenarios examined, Britain would have a "less open and interconnected economy."

"It's a complete fantasy to suppose that there is some radically different other arrangement that Britain could negotiate, where we have access to the single market but don't accept any costs or obligations of EU membership," Osborne wrote.

The six percent economic drop forecast was based on the assumption that in the event Britain left the bloc, it would negotiate a trade deal similar to the EU-Canada pact, according to extracts from the report.

The agreement with Canada will remove most duties between the EU and Canada by 2023 and allow EU companies to bid for public contracts in Canada.

The UK Treasury's 200-page report has been months in the making and is the latest stark warning from the government ahead of the June 23 referendum.

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