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Prominent pro-Brexit economist Roger Bootle has said he believes there’s a “huge chance” that Britain might walk away from the EU in 2019 without a deal having been done.

The chairman of Capital Economics said: “The logic of the situation means that getting a decent deal by 2019 is going to be extremely difficult.

“A lot’s dependent on Mrs Merkel. If she makes the decision that, having been re-elected, she doesn’t want a bust-up with Britain, she could rein in the hardliners. If she’s not of that view, I suspect there’s going to be an almighty row, not so much between them and us, but between them.”

Mr Bootle, who was in Cardiff to speak at the annual Julian Hodge Lecture, said he did not agree that leaving without a deal would be a worst-case scenario.

And he said that as a currency the euro is unsustainable and predicted its demise in the 2020s, as its valuation had only served to drive German exports while putting other economies such as Italy, at a disadvantage.

Mr Bootle said: “Once you look at the issue, leaving the EU without a free trade agreement is very far from being a disaster. In many ways I think it’s already in the markets, that’s why the pound has been as weak as it has.

“For most producers of most things, the fall of the pound has already more than offset whatever tariffs they might face.”

He pointed out that the UK already relies on World Trade Organisation rules for much of its international trade: “We trade with 120 countries around the world, including such minnows as the US, Japan, India and China, under WTO rules."

All it means is trading with countries with whom you don’t have a free trade agreement, and because the EU is so bad at negotiating free trade agreements there are umpteen countries we don’t have free trade agreements with.”

He argued that Britain would gain a net benefit from trading with the EU countries under such circumstances, pointing out that the EU’s external tariff for manufactured goods averaged around 4% but the pound has fallen by 15% since before the referendum.

“So a whole lot of exporters will be winners compared to before the referendum. Disaster? I certainly don’t think so.”

And if said it a trade deal with the EU isn't reached the UK should "unilaterally" scrap all tariffs on imports, saying it would provide a huge boost to the UK consumer who were being completely overlooked in a Brexit debate being dominated by industry groups.

Mr Bootle said he didn’t think it was reasonable for the EU to demand up to €100bn in a financial settlement.

He added: “The devil is in the detail. There are commitments that will have been entered by the EU28, including Britain, that go beyond the point of our departure. But I’d have thought €100bn was fantasy. There’s no way politically a British government could get that past the British people.”

He argued that while the EU has greater bargaining power in free trade deals because of its size, the need to get agreement between so many different members made concluding deals very difficult.

“On the one hand you’ve got clout, on the other hand you’ve got nimbleness. Switzerland and Singapore have got far more free trade agreements than the EU has. They haven’t got to please the French cheese-makers and the Italian shoemakers and whatever. ... The EU’s record at signing trade deals is extremely bad, and that shouldn’t come as a surprise when you realise how difficult it must be for them.”

And he added: “We don’t have a free trade deal with the US and yet they’re our biggest single market, which tells us that free trade deals are not the be all and end all.”

He conceded farmers could face a “double whammy” if Britain leaves the EU without a deal, on the wrong side of the EU external tariff while facing lower-priced imports from Australia and New Zealand

“I think we’ll have to develop some special support mechanisms, not for the mega arable farms of East Anglia, but for the Welsh hill farmers,” he said.