UK trade with Africa after Brexit

Giorgia Giovannetti (), Enrico Marvasi and Filippo Santi

Working Papers - Economics from Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa

Abstract: We analyze current and potential trade between the UK and Sub Saharan Africa (SSA) and estimate the possible effects of UK’s exit from the European Union (Brexit) on bilateral trade. Our results suggest that, despite the UK’s interest and need for new markets and the recent positive economic performance of many SSA countries, Brexit is unlikely to have major effects on bilateral UK-SSA trade. It is difficult for the existing trade potential between the UK and SSA countries to fully materialize. This holds true even in the best-case scenario of full trade liberalization. On the contrary, trade with important partners as South Africa might decline in the scenario where the UK, which will be out of all the Free Trade Agreements signed as part of EU, fails to sign new agreements in a very short period. We conclude that Brexit will probably imply small changes in the trade patterns, which remain largely determined by structural variables including geographical distance, political stability and sectoral specialization. For SSA, the main gains in terms of trade creation are likely to come from deeper regional integration and from linkages with other major players at the world level, such as China and India.

Keywords: Brexit; Africa; gravity model; trade policy; network analysis (search for similar items in EconPapers)
JEL-codes: F13 F14 F16 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2020
New Economics Papers: this item is included in nep-eec and nep-int
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