Standard and Poor’s has rated Cyprus fourth among the countries with the most to lose from Brexit after Ireland, Luxembourg and Holland.
The ‘Brexit Sensitivity Index 2019: Who Has The Most To Lose?’ surveys 21 countries most exposed to Brexit.
It mainly focuses on the economies most susceptible to any trade and migratory aftershocks.
Cyprus was also ranked fourth in S&P’s first Brexit index in 2016, which was compiled two weeks before the British referendum in June that year.
The index measures goods and services exports to Britain, bidirectional migrant flows, financial sector claims on UK counter parties on an ultimate risk basis and foreign direct investment in the UK.
S&P’s notes that the UK market remains Cyprus’ main source of visitors and that the former colony hosts a large population of British pensioners, as well as two military bases.
In addition, a large portion of Cypriot nationals live and work in the UK with S&P’s estimating that their annual remittances to Cyprus amount to around 0.2 per cent of the Mediterranean island’s annual GDP.
The survey also shows that out of the 21 sovereign countries most exposed to Brexit, only two are not EU members – Canada and Switzerland.
Switzerland was ranked fifth followed by Malta, Spain, Belgium and Norway.
Since 2016, banks in Belgium, Germany, Ireland and Switzerland have reduced their exposure to the UK.
On the other hand, banks in Holland, France and Spain have intensified their exposure to the UK.
It’s worth noting that % 8.5 of Ireland’s GDP and 7.3% of Holland’s GDP are exports of goods and services to the UK.