Eurozone bailout chief warns Brexit will have a much bigger impact on the UK than on the EU

The impact of Britain's decision to leave the European Union will have a bigger impact on the UK than on the rest of the 28-country bloc, according to the head of the Eurozone bailout fund.

Speaking in Hong Kong on Monday (16 January), Klaus Regling, the managing director of the European Stability Mechanism, told the Asia Financial Forum: "Brexit is a disruptive event though I believe it's a bigger problem [...] for the UK than the rest of Europe."

Regling also warned 2017 would bring along increased economic and political uncertainties, which could undermine global trade.

US President-elect Donald Trump begins his mandate at the White House later next week, while Britain is expected to trigger the formal separation process from the EU by the end of March. Meanwhile, elections in the Netherlands, France and Germany are likely to add to political instability across the union.

Regling added: "The rise of populism, not only in Europe but also in the United States, questions the post war economic order that has brought unprecedented prosperity and reduction in poverty.

"As an economist I'm worried at the future of world trade, cross border cooperation, and the role of international institutions."

In a speech on Tuesday, Prime Minister Theresa May is expected to announce she is willing to take the UK out of the single market, the customs union and the European Court of Justice.

The prime minister is to make it clear the two issues she is not prepared to negotiate on are immigration and reclaiming UK sovereignty, with the EU having stated access to the single market comes with accepting freedom of movement.

May is also set to issue a plea during her speech – referred to as the Plan for Britain – for people from the "leave" and "remain" camps to set aside their differences and work together for the country's future.

Meanwhile, Trump has praised Britain for deciding to leave the 28-country bloc. "Brexit is going to end up being a great thing," the US President-elect said in an interview with former Conservative party leadership candidate Michael Gove for The Times. Trump was critical of the European Union, saying that he thought other countries would follow the UK and soon leave.

"I think it's very tough," he told the paper, "People, countries want their own identity and the UK wanted its own identity." Trump said that he was a "big fan of the UK" and that a new trade deal between the two countries "done quickly and done properly" would be "good for both sides".