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Abstract

The negotiation period following the 2016 Brexit referendum was characterized by high uncertainty regarding the new framework for bilateral relations between the European Union and the United Kingdom. In this context, an important fraction of Spanish trade with the United Kingdom was diverted to alternative markets after the referendum, in the case of those firms with a high exposure to the UK (above 10 % of foreign sales and purchases). Trade diversion was higher for exports (than for imports) and to/from EU countries.