Produce a forecast. Do not include what makes a No-Deal Brexit profoundly damaging for Britain. The result is a forecast that says that the impact of a No-Deal Brexit is negligible. Dmitry Grozoubinski explains.

The Eurosceptic group OpenEurope has just released a forecast of 2.2% lower GDP for the UK by 2030 from a No-Deal Brexit.

Only 0.5% if the UK unilaterally liberalizes. That is almost within the margin of error!

It sounds amazing.

OpenEurope report.

They included a couple of caveats though...

They did not consider the impact on British value chains or the immediate compliance costs to business.

In other news, my analysis of relocating Australia to Saturn also finds the move would have negligible GDP impact when applying those caveats.

OpenEurope report.

They did not consider ‘sector specific’ issues like financial passporting and the ability of planes to fly. I am assuming this also includes ‘sector specific’ issues like trucks and truck drivers being locked out of Europe?

OpenEurope report.

They did not consider the movement of persons. Like at all. The ability of a UK business to meet its labor needs from a diverse continent of over 400m people is not factored in.

I am sure the UK can unilaterally liberalize that given how easy the politics around it are.

OpenEurope report.

I am honestly not having a go at the researchers and academics here.

Modelling Brexit holistically is an impossible task, and we should frankly stop asking economists to try.

The authors of the paper have also been VERY transparent with their assumptions and caveats.

However, if experts are to reclaim their rightful place in the debate, they have to operate with more awareness. No amount of transparency on page 10 mitigates the impact of a report with the executive summary: “No Deal would be relatively mild negative economic event.”

To be fair to the authors, that stuff is impossibly difficult to model especially over the long term. I think they took a solid swing at what was an impossible pitch.🔷


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(This piece was first published as a Twitter thread and turned into the above article, with the author’s conscent, with the purpose of reaching a larger audience. It has been minorly edited and corrected.)

(Cover: Pixabay.)



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Former trade negotiator at the WTO and other places for Australia.

Geneva, Switzerland. Articles in PMP Magazine Website