Customs Union Brexit would cost north's economy £1.7bn warns report
THE north's economy would lose £1.7 billion over the next decade if the UK leaves the EU, but remains in the Customs Union, according to a new report.
An independent study by the National Institute of Economic and Social Research (NIESR) predicts that the Northern Ireland economy would be hit hard by a Customs Union Brexit and shrink by 3.3 per cent over the next 10 years.
That works out as a loss of £906 a year per person, based on the current population size.
The UK economy as a whole is predicted to decline by £80 bn (3.1 per cent) over the next decade in the event of a Customs Union Brexit compared to remaining in the EU, equating to a loss of £800 per year for each person.
Staying in the EU Customs Union would mean that the UK and the EU would agree not to impose any charges, or tariffs on each other’s goods.
The NIESR report, which was commissioned by the People’s Vote campaign, is the first independent study on the impact of a Customs Union, and assesses the impact of changes to trade, investment and immigration, as a result of leaving the EU.
It highlights how a Customs Union deal would dramatically impact on the spending decisions of a future Labour or Conservative government, cutting the amount of money available for public services by £13bn a year.
Garry Young, director of macromodelling and forecasting for NIESR said a Customs Union Brexit would have "widespread implications" for the UK economy.
“Leaving the EU for a customs union will make it more costly for the UK to trade with a large market on our doorstep, particularly in services which make up 80 per cent of our economy," he said.
"This inevitably will have economic costs, with widespread implications. We estimate that all regions will be adversely affected and that there will be fewer resources available to pay for public services.”