Many organisations are bracing themselves for the possibility that Britain will leave the EU without a secure deal in place after the Prime Minister’s planned trade agreement was rejected by Brussels.
Bank of England governor Mark Carney has raised the issue, saying a no-deal Brexit would be “highly undesirable”. The National Farmers’ Union says food supplies could run out by this time next year if we can’t easily import goods from the EU and beyond after the separation – and a leading pharmaceutical company says patients may not be able to access vital medicines if there are issues with getting drugs across the border.
There have also been reports about grounding flights if no agreement is reached about planes crossing particular boundaries.
Theresa May remains hopeful an agreement will be reached, but has re-iterated that “no deal is better than a bad deal”. But what is the reality of a no-deal Brexit?
Essentially, it would mean tighter restrictions on export standards and business transactions with the EU, making it more time consuming and expensive to trade. Economists predict the more difficult it is to trade, the harder the impact on the economy. This could lead to lower investment and slower growth.
However some Brexit campaigners are arguing that a no-deal scenario will make it easier for Britain to trade with countries outside Europe – and this could therefore positively impact the economy.
It certainly feels like there is a lot of speculative scaremongering going on at the moment. There’s also a good few months to go until the terms of Britain’s departure from the EU will be clearer.
We are certainly entering a crucial phase with the EU summit coming up in October, where details of the withdrawal treaty are due to be announced. Extending the negotiation deadline is also a possibility…
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