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September 13, 2017

THE cost of leaving the EU without a deal in a chaotic Brexit would be a “political mess, a legal morass and economic disaster”, UK researchers warn.

The UK in a Changing Europe have published a pamphlet called Cost of No Deal to outline the risks of storming out of negotiations.

They identify at least four broad scenarios:

SMOOTH BREXIT. All goes according to plan and we manage to have both the Article 50 and trade deal signed, sealed and delivered by March 2019 and transition is smooth.

TRANSITIONAL BREXIT. The Article 50 deal is agreed and both sides agree on transitional arrangements to bridge the gap to a full deal.

CLIFF-EDGE BREXIT. The Article 50 deal is fixed but trade negotiations stall so there is nothing to transition to so the UK becomes a “third country” with no special relationship with the EU.

CHAOTIC BREXIT. No Article 50 deal and no extension. Talks fail over citizens’ rights, the role of the European courts, money or some other issue. There are two ways in which this might come about:

1, PREMATURE BREXIT where talks break down acrimoniously and the UK decides unilaterally to stop paying EU contributions and end supremacy of EU law in the UK with immediate effect.

2, TIMED-OUT BREXIT where the talks don’t completely break down but no agreement is reached within the two year period and there is no extension.

“If the Article 50 process comes to an end because of a unilateral British decision to remove itself from negotiations,” they warn, “the political recriminations would be even more heated.”

“In both cases, the incentive for the government to blame “Brussels” for it would be extremely strong. This might extend to blaming opponents in the UK (“Remoaners” or “Soft Brexiteers”) for weakening the UK’s position.”

They conclude: “No deal doesn’t mean the country would come to a stop. But even under relatively benign conditions and with time to prepare, the impacts would be widespread, damaging and pervasive.

“It is not possible to ex ante to quantify the economic impacts, but it is reasonably clear that they will be comparable to some of the worst-case scenarios presented before the referendum.”

The UK in a Changing Europe is funded by the Economic and Social research Council and is based at King’s College London.

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