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Wales most at risk from hard Brexit, says think tank

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image copyrightFord
image captionMany firms in Wales export to the EU, such as the Ford plant in Bridgend

Wales stands to be the part of the UK worst-hit by a so-called hard Brexit, according to a think tank.

Demos said with more than 60% of exports from Wales going to the EU, it would be the most-affected of the nations and English regions by potential tariffs.

It is also threatened by the loss of EU aid, a report said.

A spokesman for the Welsh Conservative leader and Leave campaigner Andrew RT Davies called the study "tiresome".

The UK government has been approached for comment.

In the report, Demos looks at which nations and English regions could be most vulnerable based on how much they export to the EU, how many migrants are employed and whether they receive large amounts of EU funding.

The report assumes leaving the EU involves leaving the single market, and therefore immigration from the EU would be lower, and the UK would leave the customs union, leaving it facing tariffs from the EU on goods exports.

"Overall Wales has the highest proportion of exports going to the EU, and therefore [is] most affected by a potential loss of trade agreements," the report said.

Nearly two-thirds of the country's exports go to the EU, Demos said, followed by the north east, Yorkshire and Humber and Northern Ireland. London and the south west export just more than 40%.

Wales was also pegged to receive more than £1.8bn in the current EU structural funds programme, which ends in 2020.

The report said regional funds are generally a small proportion of overall Gross Value Added (GVA) - a measure of the economy broken down to regional areas.

"However, for Wales they are quite significant, amounting to nearly 1% of GVA annually," the report said.

However, the risk from loss of EU workers for Wales was deemed to be low, with less than 4% of workers in Wales coming from union, compared to more than 16% from London.

The study does not attempt to analyse potential trade deals, the impact of UK-imposed restrictions on trade or gains from being outside the customs union.

'Project fear'

A spokesman for Welsh Conservative leader Andrew RT Davies said: "According to project fear we should be holed up in a post-apocalyptic wasteland in threadbare clothes eating tinned food by now.

"Instead of a wave of job cuts, plunging property prices and economic chaos, we've seen very clear evidence that Britain remains economically competitive and consumer confidence is high.

Mr Davies added: "These reports are tiresome. We need our best and brightest working constructively with the prime minister to secure a brighter future for the UK."

A Welsh Government spokesman said: "We've been absolutely clear that full and unfettered access to the single market is vital for the future prosperity of Wales."

Plaid Cymru's Steffan Lewis said a hard Brexit "could be devastating for the Welsh economy".

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