A NO DEAL Brexit would inflict a huge blow to Scotland’s economy because of a collapse in international trade deals, the country’s leading business organisation has warned.

CBI Scotland said a chaotic exit from the EU next month could freeze exporters out of crucial markets not just in Europe, but around the world.

The warning coincided with European Commission President Jean-Claude Juncker saying he was “not very optimistic” about avoiding a no deal because there was no majority for any withdrawal plan at Westminster.

As an EU member, the UK benefits from extensive trade agreements the economic bloc has worldwide, which span around 70 countries.

CBI Scotland said 37% of total global GDP is covered by these deals.

In Scotland, exports to countries with these EU free trade agreements are worth nearly £3.9bn a year, or almost 14% of the nation’s exports.

Through the agreements, Scotland exports £790m of goods to Norway and £690m to South Korea, with the machinery, fuel and food and drink sectors among the most exposed.

If the UK leaves with no deal, these exports risk having immediate tariffs imposed overnight, costing the Scottish economy millions, the CBI said.

CBI Scotland director Tracy Black said: “If the UK leaves the EU without a deal, overnight businesses in Scotland could cease to enjoy the benefits of tariff-free trade and easy access to markets for products and services, from Canada to South Korea.

“Many firms are unaware that it’s not just their relationships with EU customers at risk from no-deal, but relationships across the globe.

“Individual businesses trading with markets outside the EU would face tariffs worth millions of pounds being slapped on them instantaneously. These trade deals span five continents and are vital for the smooth export of our goods and services.

“Exports to countries with EU free trade agreements are worth almost £3.9bn to Scotland every year.

“The risk to these deals is an overlooked danger to our economy and yet another reason why no deal is not an option for the UK and jeopardises jobs in our communities.

“It is vital compromise is shown on both sides of the Channel and politicians work quickly to come to a deal.”

A Scottish Government report this week warned no-deal could push Scotland into recession by the end of the year by causing a 7% fall in GDP and a doubling of unemployment. rk

Deputy LibDem leader Jo Swinson, who speaks at the opening of the Scottish LibDem conference in Hamilton today, said: “Every day as the chaos unfolds, we see how hard leaving the European Union will be.

“Every form of Brexit will make us poorer, it will put jobs at risk and it will weaken us on the global stage. What was supposed to be the ‘easiest trade deal in human history’ has proved to be anything but.

“Nicola Sturgeon and the SNP have learnt nothing from watching Theresa May negotiate our way out of Europe.

“Breaking a union of 40 years is destroying our country, I dread to think what dismantling a union of more than 300 years would do.”