22 February 2019

  |  CBI Scotland

News

Scotland facing huge no deal blow on trade - CBI Scotland

The Scottish economy is facing a multi-million pound blow in the event of a ‘no deal’ Brexit due to the collapse of international trade deals, CBI Scotland is warning.

Scotland facing huge no deal blow on trade - CBI Scotland

With the prospect of a ‘no deal’ exit from the European Union on 29th March appearing ever more likely, CBI Scotland is highlighting the damaging implications for UK businesses of crashing out of the trade deals EU membership provides.

The UK currently benefits from extensive trade agreements as an EU member, spanning around 70 countries. CBI Scotland estimates the total amount of global GDP covered by the EU and the countries it has trade agreements and partnerships with to be 37%.

In Scotland, exports to countries with EU free trade agreements are worth nearly £3.9 billion every year, accounting for almost 14% of the nation’s exports. This figure equates to the annual salaries of 114,000 teachers.

Through these agreements, Scotland exports goods worth £790m to Norway and £690m to South Korea each year, with the machinery/transport, beverages/tobacco and mineral fuels sectors among the most exposed.

If the UK leaves with ‘no deal’, these exports risk having immediate tariffs imposed overnight, costing the Scottish economy millions of pounds.

Tracy Black, CBI Scotland Director, said:

“If the UK leaves the EU without a deal, overnight businesses in Scotland could cease to enjoy the benefits of tariff-free trade with, and easy access to, crucial markets for products and services, from Canada to South Korea.

“Many firms are unaware that it’s not just their relationships with EU customers at risk from a no deal Brexit, but relationships across the globe.

“Individual businesses trading with markets outside the EU would face tariffs worth millions of pounds being slapped on them instantaneously. These trade deals span five continents and are vital for the smooth export of our goods and services.

“Exports to countries with EU free trade agreements are worth almost £3.9 billion to Scotland every year. The risk to these deals is an overlooked danger to our economy and yet another reason why no deal is not an option for the UK and jeopardises jobs in our communities.

“It is vital compromise is shown on both sides of the Channel and politicians work quickly to come to a deal.”

22 February 2019

Notes to Editors

Important facts:

  • The share of EU trade benefitting from reduced trade barriers is estimated to reach 40% in 2019
  • The EU and the countries it has trade agreements with cover 32% of global GDP. If we include countries with whom the EU has agreements partly in place, the figure rises to 37%