British exports to the European Union could fall by as much as 14% if the two sides are unable to strike a free trade agreement and, even with one, could be 9% lower, the U.N. Conference on Trade and Development (UNCTAD), said.
The imposition of tariffs under a no-deal scenario would crimp trade, with the effect amplified by so-called “non-tariff measures” (NTMs) such as quotas, licensing and regulatory measures protecting health, safety and the environment.
NTMs would double the negative impact of tariffs and could lead to an overall $32 billion hit to British exports, according to the UN Conference on Trade and Development (UNCTAD) study released on Tuesday.
Britain left the EU in January and aims to negotiate a deal on future relations by the end of this year, when the Brexit transition period expires.
Britain has said it wants a Canada-style trade deal with the EU, but the EU has said this would require Britain to accept a level playing field in areas from state aid to taxation.
Britain has said that it does not want regulatory alignment with the bloc and that this was not what the EU demanded of Canada for a free trade deal.