The prospects for the North West economy in the wake of a possible Brexit came under the spotlight as academics, policy advisers and business leaders debated the potential consequences at an event at Alliance MBS.
Adam Leaver, Professor in Financialization and Business Analysis, chaired the debate held in association with the Sheffield Political Economy Research Institute.
Given the contrasting economic performance of different regions of the UK, he said the impact of a Brexit on different parts of the UK had been the “one notable omission” from the national debate, and said it was unclear what such a vote would mean for Manchester and the north.
For instance Prof Leaver said North West manufacturing exports to the EU were strongly skewed towards the chemicals sector. “Does that mean that the sector will be disproportionately affected by Brexit through higher tariffs in the future? Is the region particularly vulnerable because of its dependence on chemicals?”
Colin Talbot, Professor of Government at the University of Manchester, said during its history of EU membership the UK had consistently under-utilised EU regional policies. He believed a post-Brexit UK would become even more centralised to the detriment of the North. He added: “I cannot believe that post exit there is going to be a sudden surge in terms of regional policy and investment.”
He added that Whitehall faced a “nightmare” if the UK voted to leave. “Forty years of legislation will have to be revised and it is going to be a nightmare whatever happens with an exit. We would face years of uncertainty and an exit would consume Whitehall for a decade or more.”
Fellow panellist Thomas Aubrey, Director of the Centre for Progressive Capitalism, said if – as seems likely – the pound fell in the wake of a Brexit, history would suggest that it would do little to stimulate the manufacturing sector despite making exports cheaper. “It is not obvious that a crashing exchange rate caused by Brexit would be a good idea for manufacturing. Brexit would be the death-knell for a manufacturing renaissance in the North West.”
Christian Spence, Head of Research and Policy at Greater Manchester Chamber of Commerce, said business views on the EU remained enormously varied. “Those companies which trade internationally, but not with the EU, are the only consistent majority in favour of exit, but we should be wary of lumping all business with one voice.”