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No-deal Brexit: Total chaos or free-trade bonanza?

London - Extreme doomsday scenarios for a no-deal Brexit - often based on loosely-defined scenarios - forecast grounded passenger planes, enormous queues at customs points and businesses crippled by bureaucratic chaos.

Pro-Brexit lawmakers from Prime Minister Theresa May's Conservative party, many of whom prefer no deal to her deal, insist that there is little to worry about.

The truth probably lies somewhere in between these two extremes.

Unregulated Brexit

If British lawmakers do not accept May's withdrawal deal and fail to ratify it before March 29, Britain would be on track for an unregulated Brexit.

Britain could seek an extension of the two-year Brexit negotiating process triggered by May in March 2017.

Otherwise, EU rules would cease to apply in Britain, which would drop out of shared arrangements such as common air-traffic rules or trade deals with third countries.

The land border between Northern Ireland and the Republic of Ireland poses a particular problem. Efforts to keep that border open have been at the heart of Brexit negotiations.

British citizens living in the EU and EU citizens in Britain could also face uncertainty over their status.

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"Project fear"

The Confederation of British Industry (CBI) has warned that the economic consequences of a no-deal Brexit "would be profound, widespread and lasting."

"Businesses would face new costs and tariffs," CBI director-general Carolyn Fairbairn said in a speech. "Our ports would be disrupted, separating firms from the parts they need to supply their customers."

Eurosceptics say such predictions are part of a "project fear" to persuade people to accept May's deal.

They say the two sides would be able to implement a series of rapid, sectoral mini-deals to minimize disruption before they negotiate an alternative, perhaps Canada-style deal after Brexit.

In their favour, two of the largest budget airlines operating in Britain - Ryanair and easyJet - have both said in recent weeks that they anticipate relatively little disruption from a no-deal Brexit.

Jean-Marc Puissesseau, head of the French ports of Boulogne-Calais, told the BBC last week that he had been preparing for a no-deal Brexit for a year and "will be ready" in case Britain leaves the EU without a deal.

"We will not check the trucks more than we are doing today with the migrants," Puissesseau said, referring to checks for illegal migrants trying to reach Britain from France.

In parliament, Environment Secretary Michael Gove, a senior member of May's cabinet, has said there had been "some exaggerated claims about the impact of a no-deal Brexit, and the British economy is resilient."

Short-term damage

In answer to a question on the potential impact of a no-deal Brexit on agriculture, however, Gove agreed that "farmers in some of [Britain's] most vulnerable sectors ... would be significantly adversely affected in the short term."

The Brexiteers argue that any short-term damage would be more than offset by the long-term, liberal trade deals Britain plans to sign with major non-EU economies such as the United States, China and India.

May announced plans last month to make planning for a no-deal Brexit an "operational priority" for the government.

She told parliament that a no-deal Brexit would bring risks to "the jobs, services and security of the people we serve by turning our backs on an agreement [with the EU]."

May highlighted preparations for potential post-Brexit problems "such as the flow of traffic into different ports here in the UK."

But she stopped short of earlier forecasts of doom issued by her government and the central bank.

Smaller economy

Under her withdrawal agreement, Britain's economy would be 3.9 per cent smaller in 15 years' time than it would be if the country remained in the EU, according to a government forecast in late November.

A no-deal Brexit would see GDP fall even further, by 9.3 per cent over the same period, it said.

The Bank of England forecast the same day that the pound would depreciate by 25 per cent against the US dollar in a "disorderly" scenario.

In that case, inflation could skyrocket to 6.5 per cent, and unemployment to 7.5 per cent, while GDP could fall by nearly 8 per cent, the bank said.

Angry Brexiteers dismissed the two reports, while even pro-EU economist Andrew Sentance, a former Bank of England adviser, tweeted that both forecasts appeared to "support political objectives."