Scotland business

Brexit: A no-deal could cost Scotland £14bn, says CBI Scotland

Display of vegetables Image copyright Getty Images
Image caption Farming and food production would be "severely impacted" by a no-deal, the analysis suggested

A no-deal Brexit could cost Scotland £14bn a year, new analysis by business organisation the CBI has indicated.

That conclusion was based on a study of UK government figures.

The body believes Scotland would be among the areas "significantly exposed" to the economic effect of the UK leaving the EU without a deal.

A UK government spokeswoman said the best way of avoiding a situation where there was no agreement would be for MPs to "agree a deal".

In the event of a no-deal, the CBI has insisted jobs and living standards would be hit, with farming and food production being "severely impacted".

It said those sectors would be "particularly exposed to the risk of higher tariffs and trade costs".

The UK government has predicted a 8.1% drop in real gross value added (GVA) in Scotland by 2034 following a no-deal Brexit and the CBI believes that could amount to an annual loss of output worth £14bn by that date.

CBI Scotland director, Tracy Black, said: "CBI Scotland members are clear: if the new approach to finding a Brexit deal continues to be a game of who blinks first, the whole economy will pay the price.

"The deadlock will only be broken by a genuine attempt by all politicians to find consensus and compromise, not stick to rusting red lines and political conditions. Scotland is not - and cannot be - ready for no deal.

"The projected impact on our economy would be devastating and while business will do all it can to reduce some of the worst aspects, a no-deal scenario is unmanageable."

'Delivers for the whole UK'

She added that without compromise "the whole country faces the unforgivable prospect of a disorderly Brexit which will affect jobs and livelihoods in Scotland for decades to come" and urged politicians to put prosperity before party politics in their Brexit decisions.

The UK government spokeswoman said that Prime Minister Theresa May's deal agreed with the EU - which has failed to win enough support in parliament - "delivers for the whole UK".

She added: "The Scottish economy is expected to be bigger and real wages higher than in a no deal scenario.

"No matter what approach we take, the UK economy will continue to be strong and grow into the future."