BRUSSELS European Commission economists have been banned from researching the impact of Britain leaving the 28-nation bloc, or even talking about it, for fear of getting embroiled in the heated British debate ahead of a referendum, officials said.
"There is an internal order not to discuss or study the impact of Brexit," a senior Commission official told Reuters, adding that the instruction had come from the office of European Union chief executive Jean-Claude Juncker.
As a result, the Commission's economic forecasts for the euro zone and the wider EU will take account of political and financial risks in China, the Middle East and the United States but not the glaringly obvious risk that Britain, the EU's second biggest economy, may vote to leave.
Another senior EU official said the Commission had learned to its cost the consequences of such contingency planning last year. It insisted it had no "Plan B" to manage a possible Grexit -- the risk of Greece leaving the euro zone.
Then word of just such plans leaked out, causing further upset in Athens and the money markets.
"We learned from the Grexit thing," the second official said of the lack of contingency plans for Brexit. "If we do it, the press will find out about it. So this time we're not doing it."
Unlike the possibility of a Grexit, which could have happened suddenly after Athens defaulted on an IMF loan last June, Britain will face a lengthy period of negotiating the unwinding of its 43-year EU membership if voters decide to leave in a referendum promised by Prime Minister David Cameron.
Many assume it would take at least two years, giving the Commission time to work out economic consequences.
The costs and benefits of EU membership for the British economy will be a key issue in the referendum campaign.
Cameron is trying to negotiate changes to the bloc before a mid-February summit and says he will campaign for Britain to stay in if his demands are met.
Opinion polls on the referendum, which could be held as early as June, show voters almost evenly split. Juncker and national leaders across Europe say they will work hard to avoid losing Britain.
But with data being seized on by both camps to back their arguments and Britain's boisterous and often Eurosceptic press in full cry for the campaign, the EU executive has decided it has little to gain by working out what might happen if it does.
(Writing by Alastair Macdonald; Editing by Paul Taylor/Mark Heinrich)
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First Published On : Jan 14, 2016 00:31 IST