The RAND Corporation has released a new report about trade policy uncertainty due to Brexit. The UK and EU are currently in a post-Brexit transition phase where most of the existing arrangements between both parties have remained in place. That will expire at the end of the year, however, and that means a new trade deal will need to be struck. If that fails to occur, the UK will have to trade with the EU on WTO trade terms.
44 percent of all UK exports went to the EU in 2017 while 53 percent of all UK imports came from the EU. Broadly speaking, WTO rules mean that each member must grant the same market access to all other members with the exception of developing countries and nations with free trade agreements. Such a move would result in the UK's GDP contracting by 4.9 percent within 10 years.
RAND's analysis found that the UK will be economically worse-off outside of the EU under most plausible scenarios and the key question for the UK is just how much worse-off it will be post-Brexit. As the following infographic shows, the WTO scenario is the absolute worst-case for the UK