Brexit: What are the pros and cons of leaving the EU

Trade

The EU is a single market in which no tariffs are imposed on imports and exports between member states.

"More than 50 per cent of our exports go to EU countries," says Sky News, and membership of the bloc means we have always had a say over how trading rules are drawn up.

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Britain also benefits from trade deals between the EU and other world powers and would lose some of that negotiating power, but would be free to establish its own trade agreements.

A middle-ground option would see the UK leave the political aspects of the European Union, meaning it is not bound by EU laws on areas such as agriculture, justice and home affairs, yet remains a member of the single market.

That would mean seeking membership of the European Free Trade Area, which currently includes alongside the 28 EU member states plus Norway, Iceland, Liechtenstein and Switzerland.

Former Ukip leader Nigel Farage has in the past suggested Britain could follow the lead of Norway - although he has not repeated that since the Brexit vote.

But others argue that an "amicable divorce" would not be possible.

"If Britain were to join the Norwegian club," wrote The Economist, "it would remain bound by virtually all EU regulations, including the working-time directive and almost everything dreamed up in Brussels in future." Meanwhile it would no longer have any influence on what those regulations said.

Leading Brexit campaigner Boris Johnson, meanwhile, proposed adopting a Canada-style trade arrangement that would mean access to, but not membership of, the single market.

"I think we can strike a deal as the Canadians have done based on trade and getting rid of tariffs" and have a "very, very bright future", he said.

The idea was dismissed by Cameron at the time, who said it would mean "years of painful negotiations and a poorer deal than we have today". It took Canada seven years to get its deal and it needed to ratified by all EU parliaments including regional governments in areas like Wallonia in Belgium.

Eurosceptics argue the vast majority of small and medium-sized firms do not trade with the EU but are restricted by a huge regulatory burden imposed from abroad.

A study by the think-tank Open Europe, which campaigned to see the EU radically reformed, found that the worst-case "Brexit" scenario is that the UK economy loses 2.2 per cent of its total GDP by 2030 (by comparison, the recession of 2008-09 knocked about six per cent from UK GDP).

However, it says GDP could rise by 1.6 per cent if the UK were able to negotiate a free trade deal with Europe – ie to maintain the current trade setup.

Whether other EU countries would offer such generous terms is one of the big unknowns of the debate.

Brexit campaigners argue it would be in the interests of other European countries to re-establish free trade, but their opponents suggest that the EU would want to make life hard for Britain in order to discourage further breakaways.

Click through to read the pros and cons of Brexit on investment.