Scottish GDP is projected to be 2-5% lower in the long-term than it would have been without Brexit.
Scottish GDP is projected to be 2-5% lower in the long-term than it would have been otherwise. This is mainly due to the expected reduction in trade resulted by any type of Brexit. Meanwhile, according to the report, a Brexit that results in a relationship with the EU that is similar to that of Norway is expected to have a lesser negative effect than that of a Brexit that brings forth a relationship similar with that of Switzerland or a no-deal Brexit. With regards to the possibility of a no-deal Brexit, there seems to be consensus on both sides, the UK and the EU, about the disastrous impact it would have on the economy. For instance, the Scottish government warns, in a recent report, that a no-deal Brexit represents a major economic risk to Scotland with the potential to generate a major dislocation to the Scottish economy. The duration of the economic shock a no-deal Brexit would trigger is uncertain, but it is expected to disrupt numerous economic channels. In the worst-case scenario of a prolonged period of shock the Scottish economy may go into recession. The sectors seen as being more vulnerable are the agriculture, and food and fishing sectors, because they tend to have higher levels of EU workers, while they are also subject to EU regulations and licensing requirements. The regions of Shetland, Moray, Orkney, Angus, Aberdeenshire, and Falkirk are the ones that are the most exposed.