European businesses worry about ‘Brexit’ more than ‘Grexit’

Businesses across Europe have greater concern about likelihood of United Kingdom leaving European Union than Greece leaving eurozone, shows research

Updated Jul 28, 2015

While the United Kingdom is about to go to the polls in an election where it might lead to a potential European Union exit referendum, Greece’s possibility of leaving the eurozone is also debated. As clock is ticking for both countries, it is feared that the uncertainty over their positions could have destabilising effects on the European economy.

According to Grant Thornton’s research, compiled for its upcoming “Future of Europe” report, 64 percent of businesses in the eurozone believe a British exit from the EU would have a negative impact on Europe. This is compared to 45 percent of businesses who consider a Greek exit from the eurozone would be negative. The gap is even more visible among non-eurozone EU members, at 72 percent and 46 percent respectively.

The research also measures the levels of concern in the UK and Greece. In the UK 72 percent of firms think a British exit would have a negative impact on the EU, while 84 percent of Greek businesses consider a Grexit would be negative.

While British Prime Minister David Cameron first brought up the referendum idea on Jan. 2013, currently the suggestion is highly supported by the Eurosceptic right wing UK Independence Party (UKIP) just before the election on May 9.

In a separate study, conducted by the German Bertelsmann Foundation and Ifo, Britain’s EU exit could harm its growth rates in the long run. According to the study, leaving the EU would shave off up to 14 percent of its gross domestic product (GDP) by 2030.

The German institutes said the extend of the economic losses for Britain would depend on whether the country will be able to reach free trade agreements with Europe if it exits the union.

TRTWorld and agencies