BuBa/Dombret: Brexit "Could be Particularly Harmful to the UK"

By Christian Vits

     FRANKFURT (MNI) - Bundesbank/Dombret: Brexit "Could be Particularly Harmful

to the UK"

     The repercussions of the United Kingdom leaving the European Union could

notably harm the country's economy, Bundesbank board member Andreas Dombret said

Wednesday.

     "Brexit is definitely happening, and chances are it will be a hard one - by

which I mean that there will be a complete exit rather than a partial one,"

Dombret said in a speech at the New York University. He underlined that the kind

of economic partnership still has to be determined.

     "If we do not find a solution, the EU and the UK will trade under rules set

by the World Trade Organization - which is in nobody's interest, but could be

particularly harmful to the UK economy."

     Dombret also noted the "Brexit shows that less integration is not the

solution to the root causes of our economic problems. But a simple case of more

integration is not a solution either."

     He made the point, that a New York-based physician and researcher found a

correlation between a nation's chocolate consumption and the number of Nobel

laureates per population - no surprise, Switzerland won. Against this

background, Dombret stressed that Correlation does not imply causation and

Intuition is not always based in fact.

     Then he turned to the Brexit and apparently the political debate in the US.

"Confusing correlation with causation is amusing - but it is also disturbingly

similar to what we are seeing in current political debates," Dombret said. "Is

the idea that more chocolate leads to more Nobel prizes really any different

from the idea that protectionism brings back old jobs? Is it really any

different from the idea that Brexit or the breakup of the European Union would

bring with it increased welfare and security?"

     --MNI Frankfurt Bureau; +49 69 97782671; email:

christian.vits@marketnews.com

--MNI Frankfurt Bureau; +49 69 97782671; email: christian.vits@marketnews.com