Osborne's stark Bre(ak)xit warning: Britain leaving the EU would lead to a possible RECESSION

Leaving EU would shrink UK economy by 6%, says the chancellor

Chancellor of the Exchequer George Osborne today described Brexit as the “most extraordinary self-inflicted wound”.

Osborne said that Britain leaving the EU would cause the economy to shrink by 6% by 2030.

The chancellor warned that Britain would be “permanently poorer” if Brits choose to leave the EU as every household will lose the equivalent of £4,300 a year.

The findings come from a 200-page Treasury report that makes the case for Britain staying in the EU.

Set to be launched today by the chancellor, the report will warn that Brexit will cause irreparable damages to Britain including the economy slipping into recession.

In an article in The Times, the chancellor wrote: “The conclusion is clear for Britain’s economy and for families – leaving the EU would be the most extraordinary self-inflicted wound.

“Put simply‎: over many years, are you better off or worse off if we leave the EU? The answer is: Britain would be worse off, permanently so, and to the tune of £4,300 a year for every household.

“It is a well-established doctrine of economic thought that greater openness and interconnectedness boosts the productive potential of our economy. That’s because being an open economy increases competition between our companies, making them more efficient in the face of consumer choice, and creates incentives for business to innovate and to adopt new technologies.”

According to the BBC, The Treasury report has considered three options for a post Brexit deal:

1. The UK gains a “Norway-style” deal and joins the European Economic Area (EEA).

2. The UK executes a bilateral deal with the EU similar to the one being agreed with Canada - a trade deal that has taken seven years to negotiate.

3. The UK has a trade relationship with the EU under World Trade Organization (WTO) rules, similar to the relationship between the EU and countries like Russia and Brazil.

John Redwood, the former Tory cabinet minister and Brexit supporter, challenged Osborne’s stark warnings.

Redwood said: “The prime minister was one of the senior advisers working in the Treasury while John Major’s government tried to keep this country in the EU’s disastrous exchange rate mechanism. The ERM destroyed jobs and caused misery for families across the country. The remainers were wrong then, and they are wrong now – people should not trust their judgment on the EU.”

 

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