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Brexit Means Trade And Tourism Suffer Most In Some EU Nations

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NEW YORK: The EU’s remaining 27 members will have to weigh their own potential losses after the UK voted for Brexit, with a few countries in particular facing much greater stakes.

This group includes two Mediterranean holiday spots (Malta and Cyprus), a next-door neighbour (Ireland) as well as countries whose job-seeking citizens have been attracted to the UK labour market in recent years (Poland and Lithuania). These countries heavily rely on the UK both in terms of trade and tourism.

The UK’s trade with the EU, which according to the IMF was worth over US$500bil in 2015, will likely be the single-most important issue as it prepares to negotiate its exit.

While they could decide to follow the example set by Switzerland and Norway and opt for membership in the European Free Trade Association, required payments into the EU budget may prove a sticking point for Eurosceptic British lawmakers. Even so, the sheer scale of bilateral trade with the likes of Germany (US$137bil last year) and the Netherlands (US$73bil) means there will be a lot of pressure to find common ground in terms of trade.

When considering which EU countries have the most to lose on a relative basis, Germany is closer to the middle of the pack, with the UK representing 5.8% of its global trade flows. It’s a bigger deal for the likes of Belgium (closer to 7%), Cyprus (almost 8%), and neighbouring Ireland (18.6%), which ranked first in the recently-published S&P’s Brexit Sensitivity Index.

Ireland is also particularly vulnerable to any travel restrictions that could arise as a result of Brexit – Bloomberg


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