Boris Johnson’s chief economist has stated that leaving the European Union would create an “economic shock” and be “clearly” more risky than staying in the bloc.

Writing in an official Greater London Authority report, Gerry Lyons wrote that in the short term leaving the EU would likely depress economic activity, and pose higher risks to leaving the EU than staying in.

His analysis contradicts claims made by Mr Johnson yesterday, accusing opponents of Brexit of scaremongering.
Johnson’s  referred to the Treasury’s inclusion of a prediction of an “economic shock” in an analysis as a “curious spectacle”.“I am ever more convinced that the real risk is to sit back and do nothing, to remain inertly and complacently in an unreformed EU that is hell-bent on a federal project over which we have no control,” the Mayor wrote in the Daily Telegraph newspaper.

Ironically, chief economist, Mr Lyons contradicted Mr Johnson in a new report, “London: The Global Powerhouse”, released on Tuesday morning saying:

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“Leaving the EU would be an economic shock. Most, if not all, economic shocks depress economic activity,” the report states.

“Thus economic forecasts that focus on, say, a couple of years ahead would tend to show that leaving the EU is always worse than the alternative.”

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RISKS

The renowned economist concluded Britain will face higher risks leaving, but that there were also some risks to staying in. In his report, he states:

“Clearly these forecasts show a higher downside risk outside the EU, highlighting the importance of the policy chosen,” he said.

“However, these forecasts also indicate there is uncertainty associated both in leaving the EU and staying in it.”

His professional comments casts a dark shadow over the decision of the Mayor of London announced last month that he would campaign to leave the European Union –  an announcement that split the Conservative party right in the middle. Johnson’s told the prime minister of his decision 9 minutes before he went public on his stance to join the exit campaign, annoying the Prime minister in the process.

DISCREDIT

However, the comments of Johnson’s economic adviser highly discredits the comments and opinion of the Mayor of London, making his opinion seem politically motivated as suggested by the Prime Minister.  Today, The Sun Newspaper did however state that Britain being one of the richest countries, will attract trade from other countries who will be happy to trade with the UK. The paper accepted that Britain may face a temporal economic set back lasting a few years, but said the long term gains of leaving will outweigh the benefits of staying in the union.

The next few months in the lead up to the elections should be very interesting.

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