Euromonitor International’s Light Brexit Scenario Results in Improved Income Levels
Our Light Brexit scenario helps clients to understand the impact of a potential compromise between the UK and European Union (EU), where the UK government softens its stance on immigration control in return for access to the common market and passporting rights for the financial sector. The length of time it took to conclude the first phase of Brexit negotiations covering the divorce settlement means we have assigned a probability of only 5-15% to this scenario (as we see a delayed Free Trade Agreement (FTA) or No-Deal Brexit scenarios more likely). However, a Light Brexit would have the most positive consequence for the UK economy, industries and consumers, where a recovery in business and consumer confidence would lead to real GDP growth increasing by 2% relative to the baseline forecast over 2019-2023.
Did you know?
Economy: The Bank of England would continue to increase interest rates as the economy improves.
Consumers: Higher economic growth in 2019-2021 will enhance personal income and wealth dynamics relative to the baseline scenario. This will result in squeezing of social classes D and E by about 475,000 adults.
Cities: A Light Brexit entails an upward movement of households on the income ladder. Birmingham will contain 11,000 more Social Class B households compared to Euromonitor International baseline projections, while also correspondingly having 10,900 fewer Social Class D households.
Industries: A Light Brexit would be the best outcome for outbound travel demand, resulting in 98 million departures in 2021 as this scenario is expected to maintain open skies agreements, underpinning departures.
Find out more in our Quarterly Brexit Report for Q4 2017.
Euromonitor International’s Brexit Scenarios Tool helps clients to understand the impact of different Brexit scenarios on our baseline forecasts for the UK economy, industries and consumers. It will enable you to be prepared for a range of outcomes, providing the tools to stress-test strategy, plan ahead and remain profitable in these challenging times.