Leaving the European Union could blow a £100bn hole in the UK economy and cost up to 950,000 jobs, according to a report commissioned by the CBI.
The forecast, compiled for the business lobby group by the accountancy firm PwC, will be outlined by the business lobby group’s director general, Carolyn Fairbairn, at a speech at the London Business School.
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It shows that UK GDP could be 5.5 per cent smaller (around £100bn in today’s money) by 2020, in a scenario in which a favourable free-trade deal between the UK and EU is not agreed relatively swiftly.
CBI director general Carolyn Fairbairn said an EU exit following the referendum on 23 June “would be a real blow for living standards, jobs and growth.”
“The savings from reduced EU budget contributions and regulation are greatly outweighed by the negative impact on trade and investment,” said CBI director-general Carolyn Fairbairn.
“Even in the best case this would cause a serious shock to the UK economy.”
The picture after 2020 shows higher growth under the Brexit scenarios, though not quickly enough to make up for the initial loss forecast.
The free trade agreement would result in growth of 2.7 per cent and the WTO deal 2.6 per cent in the five years to 2025, compared to 2.3 per cent within the EU.