Wednesday 24 / April / 2024
London: Leaving the European Union would cost the average working Briton the equivalent of a month's salary by 2020, the Organisation for Economic Co-operation and Development (OECD) said on Wednesday, joining a chorus of economic bodies warning against an exit.
Angel Gurria, OECD secretary general, said Britain would have less access to the bloc's single market of 500 million consumers, investment would slow and companies could move to other countries as a result.
As economists at the global economic policy body warned of the risk of further strains on Britain's wide current account gap and a fall in the value of sterling, Gurria took aim at the "Out" campaigners, accusing them of creating a "delusion" by saying the country would prosper outside the EU.
He said official figures released on Wednesday showing Britain's economic growth slowed in the first three months of the year underscored how the possibility of a so-called Brexit was already weighing on confidence.
Analysts said the impact of the June 23 EU membership referendum was likely to weigh more heavily in the second quarter and industry figures showed retail sales fell at the sharpest rate in more than four years in April.
Gurria said bluntly that there would be no economic benefits for Britain from a Brexit, even under the most favourable scenarios.
"Our conclusion is unequivocal," he said in a speech in London. "The UK is much stronger as a part of Europe and Europe is much stronger with the UK as a driving force. There is no upside for the UK in Brexit, only costs that can be avoided."
Campaigners in the "Vote Leave" camp immediately challenged the OECD's credibility, saying it had damaged its reputation by promoting the benefits of the euro currency.
Support for the "Out" campaign has risen in recent days, two opinion polls showed on Tuesday, despite expectations that calls from US President Barack Obama and other global figures for the UK to stay in the bloc would help the "In" camp.
"Out" campaigners, chief among them London Mayor Boris Johnson, argue that Britain's economy would flourish outside the EU by saving its annual contributions to bloc, freeing itself of red tape and striking its own trade deals.
"After (we) Vote Leave and take back control we will be able to cut our tax bill because we will no longer have to fund overpaid and under-taxed international bureaucrats," Vote Leave spokesman Robert Oxley said in response to Gurria's comments.
In his speech, Gurria said the savings from no longer paying into the EU budget were minute compared with the boost to the economy from being in the EU.
He also took on one of the "Out" campaign's main arguments, that Britain was suffering from large flows of EU migrants. Foreign workers coming to Britain made a positive contribution to the country's public finances, he said.
Earlier this month the International Monetary Fund said Brexit would deal a damaging blow to the global economy.
And last week, US President Barack Obama warned Britain would move to "the back of the queue" in trade talks with Washington if it left the bloc.
The OECD's warning of lost income to British workers echoed the message from Britain's finance ministry which said last week that households would be £4,300 ($6,281) worse off each year by 2030 if the country left the EU than if it stayed.
