UK and EU

UK could lose its AAA credit rating if it leaves the EU

Written by Joseph Nordqvist

Published: 20:25, October 29, 2015

The UK could end up losing its ‘AAA’ credit rating if it leaves the European Union.

Moritz Kraemer, Standard and Poor’s (S&P) chief sovereign rating officer, told Reuters that Britain’s coveted AAA rating could be reduced by two notches if the country’s relations with Brussels “deteriorated significantly” as a result of a Brexit.

“Should we conclude that departure from the EU is likely over the medium term, we could lower the rating by potentially more than one notch, depending on the circumstances, such as the expected future relations with the EU,” Kraemer said.

Scotland remaining in the UK after a Brexit is another factor. Leaving the EU could result in a new vote on Scottish independence, especially given the SNP Government’s opposition to a UK withdrawal from the European Union.

Kraemer said: “It is one thing to leave the EU, but if the country gets divvied up further, then that is another layer of complication and problems.”

Earlier this month a poll revealed that 39 percent of Britons support a UK exit, the highest level since 2012.

The number of Eurosceptics, those who believe that the UK would prosper outside the European political and economic bloc, has increased steadily over the last several months.

However, most business leaders are believed to be strongly in favour of staying in the EU, given that the bloc is our biggest trading partner and the largest single consumer market in the world.

An EU referendum is due to take place by 2017 at the latest.

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