But the Open Europe study suggests that the City of London and financial services are most exposed to a Brexit, with the risk that new barriers to entry to the EU single market would be erected without Britain having any say.
The report covers sectors that account for roughly half of Britain’s exports to the EU and considers what alternative deal might be available to Britain in the event of a referendum vote to leave the 28-member bloc.
Based on interviews with businesses, trade associations and others, Open Europe concludes that all exporting sectors would experience initial disruption and uncertainty in the event of a Brexit.
That risk could come sharply into focus if David Cameron wins the general election on May 7: he has promised an in-out referendum by the end of 2017, with some Conservative officials eyeing a possible vote next year.
Britain’s exclusion from the EU single market could expose exporters to external tariffs; Open Europe says cars imported into the EU are subject to a 10 per cent tariff, with food and beverages facing surcharges of, on average, at least 20 per cent.
The report says Britain could negotiate preferential trade deals, however, because it tends to run a trade deficit in goods sectors. Manufacturers elsewhere in the EU would have a vested interest in securing a deal to maintain their exports to Britain.
But Open Europe says that, even if a trade deal were struck, goods exporters could still face new administration costs at the border because of EU rules governing foreign content in their products.
The report concludes that Britain’s financial services and insurance companies would be most exposed, since they already run a big surplus in trade with the rest of the EU.
“All sectors would suffer from the UK’s loss of voting rights in the EU, but for industries such as financial services the impact could be greater,” the report says. “Barriers to entry could be increased by new EU regulations over which the UK has no vote.”
Open Europe says Britain may have to choose between “third country” status with restricted EU access or somehow remain part of the single market — like Norway — without any input into the rules of that market.
It says there would be high initial impact on banks and other financial companies, which would lose their single market “passport”; they might have to establish subsidiaries to maintain access to the single market.
The prospect of striking a good trade deal on financial services would be diminished by the “deficit” logic: Britain has a trade surplus of almost £20bn so EU partners would have a limited incentive to strike a deal.
The report adds: “Post-Brexit the centre of gravity within the EU may shift towards a tougher regulatory regime for accessing the single market. The European parliament’s hostility to Anglo-Saxon finance could prove a major stumbling block.”