THE Brexit/Covid cocktail is going to have a very sour taste over the festive season and will linger long into the New Year. The Spanish Foreign Minister, Arancha González Laya, who speaks perfect English, this week expressed her concern about what the end game is going to be, stressing that whatever the outcome the Spanish economy will suffer at a time when Spain and its fellow EU buddies need economic stimulus, not a gaping great hole in their coffers which will be left by the UK’s exit from the brotherhood.
If there is no post-Brexit deal, trade relations between the United Kingdom and the European Union will fall under the rules of the World Trade Organization, involving average tariffs of around 7%. But regardless of whether there is a deal or not, Spain will be more exposed to the British economy’s ups and downs than many other European countries, according to the Bank of Spain.
Spain’s trade exposure to the UK is “significant.” Spanish exports of goods and services to Britain accounted for 9.6% of total exports in 2019, representing 3.4% of Spain’s gross domestic product (GDP). This figure is higher than in Germany, France or Italy.
The report also underscored the importance of British tourism to Spain: the UK is the country of origin of a majority of tourists, accounting for 21% of all arrivals and 19% of tourist spending in 2019. So, does the EU really want it to end in tears?