Bankers Predict Brexit Pain More Intense for UK than Europe
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"For the first time, we cannot count on the United Kingdom. There is no government, we cannot place our trust in the future, there is just too much uncertainty," Jean Lemierre from BNP Paribas said on Friday.
"The longer the uncertainty persists, the more the UK will suffer. But the euro zone is a huge area with strong infrastructure and all the right expertise," Lemierre added.
The banker's colleague Samir Assaf, a specialist from HSBC, told EurActiv on Friday that the UK is an important economy, but "it only represents 4% of global GDP"."The market indicators are at the same levels as they were before Brexit. So it is not the end of the world," Assaf concluded.
He highlighted that the UK's GDP could decline by 2.7% as inflation increases as high as 4%, strongly influencing the country's economy.
However, some other analysts have not been as pessimistic about the impact of Brexit on both economies, even though Standard & Poor's (S&P) cut its expectations for economic growth in the euro zone and the UK. S&P cited in a fresh report that both sides will see a tangible impact on their economic performances in the next two years.
Still, S&P expects that the UK will face a drop in investments, and it has predicted that Brexit will reduce the UK's GDP by 1.2% in 2017 and 1.0% in 2018.
The UK economy is expected to advance 0.9% and 1.0% in 2017 and 2018, respectively, while S&P's current forecast for euro-area GDP growth stands at 1.3% and 1.4% in 2017 and 2018, respectively.
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