Synoptic Short: Consequences of UK leaving the EU Customs Union

Here is a short video focusing on some of the synoptic aspects of the UK leaving the EU customs union. Synoptic economics involves bringing micro and macro effects and influences into play when building analysis and evaluation.

Possible microeconomic effects

• Impact on costs & revenues of sectors that trade heavily with EU
• Effects on consumers if there are tariffs applied to goods & services from EU
• Consequences for UK farming sector of end to EU import tariffs

Possible macroeconomic effects

• Impact on patterns of trade between the UK and EU / non-EU countries
• Consequences for economic growth and real living standards in long run
• Consequences for government finances once outside of the European Union

Contextual background: EU Tariffs

While the UK is a member of the EU, there are no tariffs on trade with other EU member states. Goods imported into the EU from non-EU countries pay the EU’s common external tariff, unless there is a free trade agreement or preferential trade agreement.