Oliver Wyman have recently conducted a cross-sector, pan-European analysis of the impact of Brexit, with a deep-dive into the impact on Spanish industry. Our analysis quantifies the impact of tariff and non-tariff barriers on direct UK-Spain and UK-Portugal trade – direct cost of Brexit; the impact is concentrated in specific industries, but smaller in aggregate impact than other studies.
The Spanish and Portuguese deep dive revealed several key findings that are country-specific for them:
The UK is an important destination of both Spanish and Portuguese exports: the UK is the fourth exports destination for both Spain and Portugal.
The impact of Brexit is concentrated on three industries in both Spain and Portugal, accounting for 70% and 60% of the total impact respectively: Automotive, Agriculture, food and drink; and Consumer goods
- In Spain, the sectors cost breakdown is as follows: Automotive €886 MM (4% of GVA), Agriculture, food and drink €584 MM (0.8%), Consumer goods €242 MM (0.5%)
- In Portugal, the sectors cost breakdown is as follows: , Consumer goods €92 MM (1.0%), Automotive €90 MM (2.7%), Agriculture, food and drink €57 MM (0.5%)
– For both economies, the overall impact is ~0.3% of country GVA, which is similar to the average for the EU as a whole.
In absolute terms, Spain faces the 6th largest impact in the EU
Under the baseline WTO scenario, at an aggregate level the trading cost of Brexit is material:
- Spain: Post-mitigation impact of ~0.3% of GVA; ~€2.5BN
- Portugal: Post-mitigation impact of ~0.3% of GVA; ~€0.3BN
- UK: Post-mitigation impact of ~1.5% of GVA; ~€35 BN
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