CEBR: Brexit but staying in the Single Market could leave UK GDP higher by 2030

Jessica Morris
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A leading think tank has said Britain leaving the EU but staying in the single market could result in its GDP being higher by 2030.

It comes amid rising furore over the Treasury's prediction that each UK household would be £4,300 worse off if the UK leaves the EU.

The Centre for Economics and Business Research (CEBR) said Brexit would spark two years of turmoil while any new arrangements are negotiated.

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During this period sterling would plummet 10 to 15 per cent, blighting inward investment, and probably leading to negative growth in 2017.

But afterwards a lower exchange rate would make the UK look more attractive. Meanwhile, most of the lost GDP would be recovered and the economy could start growing at a faster rate.

"Although the outcome is highly uncertain, on this scenario it is more likely that GDP would be higher by 2030 after Brexit than lower," the CEBR said.

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The CEBR cautioned such a scenario depends on Britain's ability to keep its trade with the EU, attract inward investment and retain the flow of skilled migrants.

"We have tried to put together what analysis is available to give an impression of what the UK might look like after Brexit," it said.

"We have tried to be as neutral as we can but obviously any view on this has to incorporate assumptions which are liable to be disputed, especially with passions high on both sides."