Belfast Telegraph

OECD warns of 'substantial' effect of Brexit on economy

By Holly Williams

Leaving the EU would have a "substantial" impact on the UK and global economy while also sparking turmoil in world stock markets, according to the OECD as it ramped up its warnings ahead of the referendum.

The Organisation for Economic Cooperation and Development (OECD) slashed its forecasts for the UK economy as it said Brexit fears have already "undermined" growth.

It added that Brexit would have significant impact on growth across Europe and the rest of the world and would trigger turbulence in financial markets.

In its latest economic outlook forecast, it said: "A decision to exit would result in considerable additional volatility in financial markets and an extended period of uncertainty about future policy developments, with substantial negative consequences for the UK, the EU and the rest of the world."

The OECD cut its forecast for UK growth this year to 1.7%, down from 2.2% predicted in February.

But this assumes a vote to remain in the EU, and the OECD reiterated Brexit warnings for growth following a report in April which said it would cost British workers the equivalent of a month's pay by the end of the decade.

The OECD estimated in April that by 2020 GDP would be more than 3% down on what it would have been if Britain had remained in the EU - the equivalent of £2,200 per household at today's prices.

Under the OECD's "central scenario", by 2030 the loss of GDP would have risen to more than 5% - a loss of £3,200 per household.

The group's latest gloomy assessment also underlines its fears over the global economy, which it said would grow by just 3% this year, and only edge up slightly in 2017 to 3.3%.

A report by the Treasury last week said that a Brexit would wipe £1.3bn off the value of Northern Ireland's economy and lead to the loss of nearly 15,000 jobs.

Belfast Telegraph