Brexit cost to be higher for UK than EU: Barnier
Brexit is a "lose-lose" situation for both sides but the cost to the UK will be "substantially higher", European Union chief negotiator Michel Barnier has said.
The senior Brussels official warned that skills shortages could hit the NHS and dismissed the terms of Theresa May's plans for a comprehensive deal on financial services. But he insisted there was "no intention of discriminating against the UK" and London would remain a "global financial centre".
In a speech in Sofia, Bulgaria, he said: "Outside of the customs union and the single market, there can be no frictionless trade.
"Businesses will be faced with non-tariff barriers and border checks that do not exist today."
He added: "The situation would be made worse in a 'no deal' scenario, which would result in the return of tariffs, under WTO rules.
"So, Brexit will come at a cost. And this cost will be substantially higher for the UK than for the EU."
The EU accounted for around 50% of UK exports and imports, while the UK was only 7% of EU exports and 4% of imports - although Mr Barnier admitted some regions were "more exposed" than others. The "unavoidable friction and non-tariff barriers" after Brexit could lead some overseas firms investing in the UK to "rethink their business models", he said.
In a warning about the ability to recruit workers for health and care roles, Mr Barnier said: "EU talent may find the UK to be a less attractive place. This could generate skills shortages, for instance in the health sector." Turning to financial services, Mr Barnier denied the suggestion the EU "desperately needs" the City of London.
He added that Mrs May had said the UK was not looking for "passporting", which gives financial services firms the automatic right to operate in the EU but wanted to retain the benefits of it. Mr Barnier said: "The EU understands that the UK does not want to become a 'rule-taker'. But the UK also needs to understand that the EU cannot accept mutual market access without the common safeguards that underpin it."
Trade body UK Finance's chief executive Stephen Jones said: "We believe a framework based on regulatory alignment and close supervisory cooperation can be developed to deliver the best outcome for both the EU and UK.