Brexit will hit the UK harder than the EU, according to a German research institute’s report based on evaluation of trade figures.
“These show that the EU’s share of the UK’s trade is much larger than the other way around,” said the ifo Institute report published on Tuesday.
While Brexit means both sides lose, the UK loses remarkably more, it said.
“It is in both parties’ interests to have a trade agreement in place as of Jan. 1,” said Lisandra Flach, director of the ifo Center for International Economics.
In 2019, the 27 member countries of the EU were the source of 50% of the UK’s imports and the destination for 47% of its exports, making the bloc the largest market for the UK, according to the report.
“For the EU27, however, the UK is much less important: in 2019, only 4% of the bloc’s exports went there and 6% of its imports came from there,” it said.
In all European countries, only a few goods are highly dependent on imports from the UK, said Flach, explaining that this means the rise in trading costs due to Brexit will have a much smaller impact on firms in the EU27 than is expected for their UK counterparts.
The report said full reliance on one country of origin further increases the risk of adverse shocks to the UK.
For instance, the UK imports 53 goods exclusively from Germany, of which around 77% are intermediate products and many of them are organic chemical products.
The UK approved the Brexit decision with 52% votes in favor in a referendum held in June 2016.
Britain officially left the EU on Jan. 31 this year but is holding extensive negotiations with the bloc on bilateral relations, particularly trade.
Ensuring fair competition, resolving commercial disputes, and fishing rights are problematic issues in the ongoing talks.
If an agreement cannot be reached by Dec. 31, commercial relations between the two parties will be made according to the World Trade Organization’s rules.
Copyright 2021 Anadolu Agency. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.