Published: Wed, March 14, 2018
Business | By Tara Barton

Britain, EU should aim for customs union - Germany's…

Britain, EU should aim for customs union - Germany's…

Anti-Brexit demonstrators wave EU and Union flags outside the Houses of Parliament in London, Britain, January 30, 2018.

German firms will lose some 9 billion Euros (11.1 billion dollars) annually after Britain leaves the European Union if trade continues according to World Trade Organisation (WTO) rules, multinational law firm report revealed on Monday.

The cost of Brexit for the United Kingdom's and European Union firms might amount to 58 billion pounds (about $80.6 billion) per year if a new trade deal is not negotiated, a report prepared by the Oliver Wyman consulting firm and Clifford Chance law firm said on Monday.

In return, British exporters to the European Union will have to pay £27 billion a year.

Ashton Whiteley economists say that these increased costs could pose a very real threat to many businesses as they could potentially reduce profits significantly.

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Britain is due to leave the European Union next year after voting in favour of ending more than four decades of political, economic and legal ties with the world's largest trading bloc.

Meanwhile, London and Brussels can reduce the cost of Brexit for their firms if the two parties negotiate a new customs agreement that would have a lot in common with the existing EU Customs Union. It has set aside £3 billion to prepare for all eventualities.

Britain and the EU are now trying to hammer out a post-Brexit trade deal, but London's insistence that it leave the customs union with the EU and its internal market. But Lang said that foreign direct investment flows to Britain had already slowed previous year and that German exports to Britain had fallen in 2017. Britain's vast financial sector would be the worst-hit industry.

The Bank of England has warned that about 10,000 finance jobs may leave Britain by the end of next year because of Brexit.

In the European Union, the hardest hit sector would be the automotive sector, agriculture and food and drinks, chemicals and plastics, consumer goods and industrials, the report said.

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