WTO warns on Brexit customs bill for exporters
British exporters risk an extra £5.6 billion ($8.2 billion, 7.2 billion euros) of annual customs duties if the country votes to leave the EU, the World Trade Organization (WTO) chief warned on Tuesday.
Britain would need new trade deals with the EU and with each of the 58 countries that have free-trade deals with the bloc, Director General Roberto Azevedo said at a conference in London.
"This would probably entail negotiations," he told the World Trade Symposium.
"In the meantime, while trade would continue, it could be on very different terms and perhaps worse.
"Most likely, it would cost more for the UK to trade with the same markets -- therefore damaging the competitiveness of UK companies.
"The implication is that UK exporters would risk having to pay up to £5.6 billion each year in duty on their exports," he said.
Almost half (47 percent) of British exports are to other countries within the EU, and around 13 percent to the bloc's preferential trade partners.
In addition, "there could be an impact on services trade", Azevedo told policymakers at the meeting, co-organised by the Financial Times.
Britain would also need to renegotiate the terms of its WTO membership and would not necessarily retain privileges afforded to other European countries whose membership is under the auspices of the EU.
"The UK, as an individual country, would of course remain a WTO member, but it would not have defined terms in the WTO for its trade in goods and services," the WTO chief said.
"It only has these commitments as an EU member. Key aspects of the EU's terms of trade could not simply be cut and pasted for the UK."
A vote to leave on June 23 would present an "unprecedented" challenge for the WTO, making it impossible to set a timeframe for a deal to be struck, he warned.
"Negotiations merely to adjust members' existing terms have often taken several years to complete - in certain cases up to 10 years, or more."
Britain's need to agree deals quickly would put it in a weak negotiating position, he said.
"Other countries already have their negotiating priorities and may not be ready to shift resources to a new negotiation overnight," he said.
"It could take quite some time before the UK got back to a similar position that it has today."
The warning follows similar interventions by the British Treasury, the Bank of England, the International Monetary Fund and US President Barack Obama, who have all raised the spectre of negative economic consequences of a Brexit.
Polls currently show the two sides almost neck-and-neck, although bookmakers still make the "Remain" camp heavy favourite.
© 2016 AFP