Wales hit hard as Brexit impact study revealed
WALES would suffer a 9.5% hit to GDP if the UK leaves the European Union without an exit deal, according to leaked figures from a UK Government analysis of the consequences of Brexit.
The nation would see a 5.5% reduction in GDP even if the UK leaves with a free trade deal under this assessment – and there would still be a 1.5% blow if the country stayed in the single market.
The predicted losses are understood to cover a 15-year period.
The leak comes as Prime Minister Theresa May and senior cabinet ministers meet to hammer out an agreed end-goal for the Brexit negotiations.
The areas of the UK which would take the worst hit from a no-deal Brexit would be the northeast of England (-16%) and the West Midlands (-13%).
According to this analysis, there is no
part of the UK that would not see a reduction in GDP under any of the three scenarios.
Overall, UK GDP is expected to go down by 2% if the UK stays in the single market, by 5% if a free trade agreement is secured, and by 8% if there is no deal.
London would suffer the least, the analysis suggests.
The UK capital would only see its GDP go down by 1% if the country stayed in the single market; by 2% if there is a free trade deal; and by 3.5% if there is no deal.
Vaughan Gething, the Welsh Government Cabinet Secretary for Health and Social Services, said: “This is not remoaners or enemies of the people – this is the UK Government’s own view of the damage done by a hard Brexit. Damage done to my communities that I represent.
“My duty to my constituents must be to stand up against the disaster of a hard Brexit.”
Cardiff South and Penarth Labour MP Stephen Doughty said: “People in every corner of the United Kingdom will be shocked to see the Government’s own assessment of the damage Brexit will do to their communities. It is utterly shameful that people all across this country are having to rely on leaks to find out how much damage a hard, destructive Brexit will do to their local economies and the country as a whole.”
Mr Doughty, who is a leading supporter of the Open Britain campaign which favours close links with the EU, called for the full publication of the UK Government’s research, saying: “The Government cannot continue to try and hide taxpayer funded analysis from the public, just because they’re afraid of the political consequences. The full Brexit impact assessments, along with any other economic analysis of Brexit outcomes, must be published in full, now.
“And as people learn new facts about the costs of Brexit for their communities and their industries, everyone is entitled to keep an open mind about whether or not it’s the right path for the country.”
However, DUP Brexit-supporting MP Ian Paisley said the predictions were as “reliable as astrology”.
Plaid Cymru Brexit spokesman Hywel Williams said: “These sobering statistics lay bare the devastating impact a hard Brexit would have on our economy. Just as Plaid Cymru has argued all along, remaining in the single market would be the most favourable option if we are to defend Welsh jobs and industries.
“Yet again, Wales is set to be worse off than the UK as a whole as a result of disastrous decisions taken by the Tories and unopposed by Labour in Westminster. Members of all parties should be uniting in the national interest to present the resounding case for Wales to remain in the single market and customs union.”
Mid and West Wales Plaid Cymru AM Simon Thomas said the figures showed Wales would be “shafted under any realistic scenario”.
Swansea West Labour MP Geraint Davies said: “Wales has been hard hit by austerity – with public sector pay freezes, cuts in services and a benefit squeeze on the most vulnerable. Now Brexit, with reduced trade and us paying for the EU Divorce Bill, means vital infrastructure projects in south Wales like rail electrification and the Swansea Tidal Lagoon are being cut...
“These ground-breaking leaked documents show that the government know the true cost of Brexit, but have tried to keep us in the dark.”
A Welsh Government spokeswoman said: “Our Brexit trade paper, supported by a Cardiff Business School impact study, shows the Welsh economy is best protected by retaining full and unfettered access to the European Single Market and membership of a customs union.
“This report suggests UK Government research confirms our analysis that a hard Brexit would have a catastrophic impact on Welsh jobs and the economy; reducing the economy by 8–10%, which is the equivalent of between £1,500 and £2,000 per person in Wales.
“We have tried wherever possible to base our Brexit policies on evidence and to publish the evidence we have. We call on the UK Government to do likewise.
“We do not believe the UK Government has any sound economic evidence to support its policy choices as to the sort of Brexit it is pursuing.”