Brexit: UK 'will diversify away from EU' says expert

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The European Commission has issued an economic forecast that predicts the UK will lose around 2.25 percent of its gross domestic product (GDP) as a result of new future relationship pact with the bloc. In contrast, the EU executive’s army of economists insisted the Trade and Cooperation Agreement would only cost the 27-nation bloc around 0.5 percent by the end of 2022. It was said the British slump would be worth more than £40billion over the two-year period.

In its winter economic forecast, the Commission said: “While the FTA improves the situation as compared to an outcome with no trade agreement between the EU and UK, it cannot come close to matching the benefits of the trading relations provided by EU membership.”

The report added: “For the EU on average, the exit of the UK from the European Union on FTA terms is estimated to generate an output loss of around 0.5 percent of GDP by the end of 2022 and some 2.25 percent for the UK.”

The EU’s stinging criticism comes despite its own economists claiming the bloc’s slow roll-out of coronavirus jabs could cost their economy dear.

And former Brexit Party MEP Alex Phillips questioned why the EU was attempting to contrast its fortunes with Britain over Brexit while failing to deliver life-saving vaccines.

She said: “Claiming Britain’s economy will slump is pretty rich from a bunch of eurocrats that have put EU unity ahead of saving grandma’s life.

“While Brussels is struggling to get jabs into its peoples’ arms, Britain is racing ahead and will be able to lift lockdown measures much quicker than the EU.

“As a result, the UK’s economy will open much faster and EU27 will be left counting the costs of human lives and lengthier lockdown measures.”

Brussels slashed its economic growth forecasts as the shambolic rollout of coronavirus vaccines continues to plague the bloc’s economy.

The Commission has predicted the EU’s gross domestic product would increase by 3.7 percent this year, down from its previous forecast of 4.2 percent.

Its economists warned the EU’s economic recovery is directly linked to the bloc’s ability to successfully deliver doses of Covid jabs to member states.

They said the downward revision in their winter forecast was “related to the evolution of the pandemic and the pace, efficiency and effectiveness of vaccination rollout”.

The Commission said it was forced to downgrade its economic forecasts because of the continued “uncertainty and risks” surrounding the latest wave of COVID-19 infections battering the bloc.

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“In terms of negative risks, the pandemic could prove more persistent or severe in the near-term than assumed in this forecast or there could be delays in the roll-out of vaccination programmes,” its report said.

“This could delay the easing of containment measures, which in turn affect the timing and strength of the expected recovery.

“There is also a risk that the crisis could leave deeper scars in the EU’s economic and social fabric, notably through widespread bankruptcies and job losses.  

“This would also hurt the financial sector, increase long-term unemployment and worsen inequalities.”

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Analysts at German finance giant Allianz recently warned Europe’s Covid jab scheme was facing a “five-week delay”, which could cost its economy €90 billion if left uncorrected.

Britain has vaccinated around a fifth of its position, delivering some 13.58 million coronavirus jabs.

In contrast, the EU has around 18.3 million vaccines at a snail-like pace of 4.13 percent of its 450-million population.

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