Africa risks losing access to $2bn UK market annually in case of no Brexit deal
In case of a no-deal Brexit, Africa would lose access to UK markets, worth $2 billion annually according to Dirk Willem te Velde Director of SET Programme.
Willem says the United Kingdom is the 2nd largest investor in Africa (FDI stock $55bn in 2016). African goods exports to the UK were $17 bn in 2016. The UK and African countries have implemented many valuable aid & trade measures to foster the relationship.
But, in case of a no-deal Brexit and if UK parliament won’t be able to pass legislation in time to roll over existing FTAs and preference schemes and without further action, African exports could face World Trade Organization (WTO) terms and risk losing preferential access worth $2bn annually.
In addition, the government’s own forecast of a reduction of 7.7% in UK GDP in case of a no-deal Brexit, combined with a prediction of a fall in the UK pound, is likely to dampen further, UK demand for developing country goods and services.
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I should add that many other developing countries risk losing preferential access in case of a no-deal Brexit on 29 March 2019, including LDCs such as Bangladesh, Cambodia, and Laos.
Whilst the UK government is committed to minimising trade disruption and to fostering trade and investment, creating jobs and promoting jobs in the poorest countries, more attention is required to the plight of UK imports from developing countries in case of a no-deal Brexit.
Dirk Willem te Velde (Director of SET Programme, Head of IEDG and Principal Research Fellow, ODI) adapted from Tweets.
