Spain hard Brexit PANIC as regions beg EU to save them from economic MELTDOWN

The EU’s European Committee of the Regions has received warnings from eight of Spain’s autonomous communities, who have claimed a no-deal scenario could cause economic chaos on the Iberian peninsula.

Andalusia has revealed 58.7% of Spanish workers in Gibraltar will be affected by Brexit, adding that 1.2 percent of the region’s GDP comes from British tourism alone.

The Balearic Islands warned it would feel the loss from the UK being given a bad deal, saying their entire economy could be impacted – with the effects on tourism and real estate being of particular concern.

Roughly 25% of the region’s tourists are from the UK, while tourism as a whole makes up 80% of their regional GDP.

The Canary Islands ships more food products to the UK than any other nation, and regional officials have warned “a sudden withdrawal without a free trade agreement of goods and services could ruin” the lucrative enterprise.

The UK is also the largest source of tourism in Murcia, and the region’s second largest export destination.

Many provinces are also deeply concerned over the loss of UK contributions to the EU budget, potentially leaving a hole of €10billion which would have gone towards community budgets across the bloc.

It comes as pressure mounts on the EU to sign a free-trade agreement with Britain after a report revealed that a “no deal” scenario could cost the bloc more than £500billion.

The shock figure emerged as Brussels looked set to cave in on a key demand to move a financial body out of the City of London and the head of Deutsche Bank was forced to admit a threatened “Brexodus” from the capital had been exaggerated. 

The pro-Brexit Economists for Free Trade group forecast that Britain will gain £651billion from walking away from talks, leaving the EU with a £507billion bill. 

Sir Patrick Minford, an economic adviser to the Treasury under Margaret Thatcher, used a classic trade model to predict that GDP will spike by nine per cent, amounting to a one-off gain of £180billion, if we leave on March 29, 2019, without a deal. 

He predicts that the UK would make an additional £433billion in tariffs imposed on EU producers if we operated under World Trade Organisation rules, because we import more than we export. 

That, plus the £38billion we have saved by not paying for the two-year transition period, adds up to a total of £651billion. 

The cost to the EU would be the loss of the £38billion “divorce” payment, plus £433billion in tariffs, plus its balance of trade surplus with the UK estimated to be worth around £36billion – a total of £507billion. 

Professor Minford said: “It could not be more open and shut who least wants a breakdown of negotiations. 

“For the UK a breakdown would be a short-term nuisance but a substantial economic gain. For the EU it is both a short-term nuisance and a substantial economic loss.” 

Additional reporting by Maria Ortega