Chemical industry and academia predict heavy impact from Brexit | March 7, 2016 Issue - Vol. 94 Issue 10 | Chemical & Engineering News
Volume 94 Issue 10 | p. 14 | News of The Week
Issue Date: March 7, 2016

Chemical industry and academia predict heavy impact from Brexit

Biotech investment would falter and academic research budgets would be cut, they say
Department: Business
Keywords: economy, Brexit, funding, poll, collaboration

A growing number of industrial and academic leaders are warning that an exit by Great Britain from the European Union—dubbed the Brexit—could have a disastrous effect on Britain’s chemistry-based industries and scientific research. Britons are set to vote on whether to stay or leave the EU on June 23.

“I can think of many different reasons why it would be bad,” said BASF Chairman Kurt Bock, speaking about a Brexit at the firm’s annual financial results press conference.

“I can think of many different reasons why it would be bad.”

Kurt Bock, Chairman, BASF

A group of 50 leaders from the U.K.’s biotech industry recently published a letter in the Financial Times newspaper stating that a Brexit “would leave a significant research funding gap” for biotech companies. The U.K. contributes about 12% of all EU funding but receives 15% of the bloc’s science research funding.

A Brexit would also require a new U.K. drug authorization system and the uprooting of the London-based European Medicines Agency to an EU country.

In another recent letter to a U.K. newspaper, 103 of the U.K.’s 132 university vice chancellors argue that Britain should stay in Europe so that it can optimize the prospects for scientific collaboration, innovation, and recruitment of talent.

A recent study by Paris-based credit insurance firm Euler Hermes calculated that a Brexit could cost the U.K. chemical industry up to $10 billion annually in lost exports and up to $3.5 billion even if the country subsequently secured a free-trade agreement with the EU. Open Europe, an independent think tank, predicts U.K. chemical firms would face a 4.6% tariff on exports to Europe.

It’s too early to tell which way the vote might go. A recent poll by YouGov and The Times newspaper found 43% of Britons would vote to stay in the EU, 31% would vote to leave, and 26% are undecided.

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