EU in chaos as it is revealed that ‘no deal Brexit’ will cost them £500 BILLION

German Chancellor Angela Merkel (R) and French President Emmanuel Macron leave the Elysee Palace in Paris on July 13, 2017, after an annual Franco-German Summit. / AFP PHOTO / Patrick KOVARIK (Photo credit should read PATRICK KOVARIK/AFP/Getty Images)

It has been revealed that a no-deal Brexit will cost the European Union and its member countries around £500 BILLION.

Remember when Nigel Farage stood up in the European Parliament and said that this Brexit outcome would hurt those left behind far more than the United Kingdom? To be fair to him, he probably knew what he was talking about!

According to a report in the Sunday Express:

PRESSURE was last night mounting on the EU to sign a free-trade agreement with Britain after a report revealed that a “no deal” scenario could cost the bloc more than £500billion.

The shock figure emerged as Brussels looked set to cave in on a key demand to move a financial body out of the City of London and the head of Deutsche Bank was forced to admit a threatened “Brexodus” from the capital had been exaggerated.

The pro-Brexit Economists for Free Trade group forecast that Britain will gain £651billion from walking away from talks, leaving the EU with a £507billion bill.

Sir Patrick Minford, an economic adviser to the Treasury under Margaret Thatcher, used a classic trade model to predict that GDP will spike by nine per cent, amounting to a one-off gain of £180billion, if we leave on March 29, 2019, without a deal.

He predicts that the UK would make an additional £433billion in tariffs imposed on EU producers if we operated under World Trade Organisation rules, because we import more than we export.

That, plus the £38billion we have saved by not paying for the two-year transition period, adds up to a total of £651billion.

The cost to the EU would be the loss of the £38billion “divorce” payment, plus £433billion in tariffs, plus its balance of trade surplus with the UK estimated to be worth around £36billion – a total of £507billion.

This is something that we have always struggled to understand ever since the result of the EU referendum in June 2016.

We have witnessed EU bigwigs and national leaders line up to say that it won’t be an easy ride for the United Kingdom over the negotiation period, and this sentiment has often bubbled over into threatening rhetoric about how Britain will be worse off unless we start dancing to their tune.

At the same time, surely someone behind these scenes of it all would have been able to identify this potential shortfall, and yet those at the top continued to behave in a manner that can only push the UK’s decision makers towards going for the ‘no deal’ option and walking away.

This is no insignificant sum of money, even in the fat cat-infested cloud cuckoo lands of Brussels and Strasbourg.

It has already been established that any shortfall would cost any remaining states proportionally in terms of their regular contributions to the bloc, and so this latest report will make very uneasy reading for Germany and France.

Having said this, Merkel and Macron have been the chief cheerleaders of the ‘let’s shaft the United Kingdom’ movement, which is frankly bizarre given the circumstances here.