The government’s ‘deal’ with the EU is atrocious, writes Ruth Lea. The Withdrawal Agreement and the ‘Political Declaration on the framework for the future relationship’ would shackle this country and have nothing to commend them. The indications are that the House of Commons will reject the ‘deal’ on 11 December, when the ‘meaningful’ vote is due to take place. One can only hope so, she argues.
If the Withdrawal Agreement is voted down, the default position would be No Deal, trading under World Trade Organisation (WTO) rules. If the Parliament wished (for example) to have a second referendum and/or postpone Brexit then enabling legislation would have to be passed – before 29 March 2019. Time is running out.
There are still voices suggesting there is scope for renegotiating our ‘deal’ with the EU before Brexit, to be nearer a Canada-style relationship for example. But the politics suggest this is simply not on the cards, and has not been for many months. Realistically, there are two clear choices: the ‘deal’ as agreed by the EU on 25 November and No Deal. If indeed the ‘deal’ is voted down, then we must, we really must, start preparing for a managed No Deal, trading under WTO rules. We must start to make a strong, positive case for it. And there is a strong, positive case.
A managed No Deal
No Deal basically refers to the absence of an agreed trade agreement, prior to Brexit Day. It does not imply the UK and/or the EU would make no mutually beneficial contingency arrangements concerning issues such as aviation, road transport, visas, residency, passports and customs. Yet I have heard some commentators, doubtless mischievously, suggest that planes, for example, would be grounded unless there is a ‘deal’, implying an all-encompassing agreement such as the Withdrawal Agreement. Clearly, a No Deal outcome has to be prepared for. It has to be ‘managed’. It would be the height of negligence if the British Government and/or the EU failed to be fully prepared.
It is important to realise that both the UK Government and the EU have made progress on this score. The British Government launched its No Deal guidance notes in August and 106 notes, according to my calculations, have already been released. They cover a very wide range of issues including driving and transport, farming and fishing and importing and exporting (including Customs). Given the increasing possibility of a No Deal outcome, it is incumbent on the Government to ensure these notes cover all bases, and other necessary administrative arrangements are fully operational by next March.
The European Commission, meanwhile, has already issued nearly 80 ‘Brexit preparedness notices’, covering a wide range of topics including financial services, transport and health and food safety. In addition, the Commission has recently released its Contingency Action Plan ‘in the event of a no deal scenario with the UK’, to minimise possible disruptions for the EU’s citizens and businesses. The Commission’s priority areas were residency and visa-related issues, financial services, air transport, customs, sanitary/phytosanitary rules, the transfer of personal data, and climate policy. It is in the EU’s interests, as well as ours, that the planes still fly.
Trading under WTO rules is normal
Given the agonies in negotiating the Withdrawal Agreement and Political Declaration, one could be forgiven for believing that trading under WTO rules is to be avoided at all costs; that trading outside the comfort blanket of the Customs Union and the Single Market would be very uncomfortable indeed. Incidentally, I believe that the supposed difficulties of trading outside the EU’s Customs Union have been grossly blown up out of proportion in the negotiations.
In reality, nothing could be further from the truth. Trading under WTO rules is not a matter of ‘falling off a cliff’ into the abyss. On the contrary, it is, for much of UK and international trade, quite normal. The UK already conducts more than 55 per cent of its export trade with non-EU members, primarily under WTO rules, and the proportion is rising. Even if allowance is made for those non-EU countries that have preferential trade deals with the EU (which may not immediately carry over on Brexit), about half of our exports go to the remaining non-EU countries.
There is no doubt that UK exports to non-EU countries have grown more quickly than to EU countries in recent years. Total exports over in the period 2007-17 grew by over 60 per cent, whilst exports to the EU and the non-EU expanded by around 40 per cent and 80 per cent respectively. Given that the EU is a relatively sluggish and saturated market, this is wholly unsurprising. Commercial opportunities drive trade rather than the supposed allure of the EU’s Customs Union and Single Market. Moreover, we shall, of course, continue to have ‘access’ to EU markets under WTO rules, as the US has ‘access’ to EU markets now. Similarly, EU exporters would continue to have ‘access’ to the UK market, which is good news for them as they had a visible trade surplus of £95billion with the UK in 2017!
The WTO’s rules are tried and tested
The WTO’s rules really are comprehensive, tried and tested. Three points, in particular, need making over and over again. The first point concerns the UK’s membership of the WTO. We are members and we will continue to be members. In October 2016 Roberto Azevêdo, the Director General of the WTO, made this very clear. He said: ‘The UK is a member of the WTO today, it will continue to be a member tomorrow. There will be no discontinuity in membership. They have to renegotiate [their terms of membership] but that doesn’t mean they are not members. Trade will not stop, it will continue and members will negotiate the legal basis under which that trade is going to happen. But it doesn’t mean that we’ll have a vacuum or a disruption.’ He could not have been clearer.
Secondly, disciplined rules based on the principle of non-discrimination are at the heart of the WTO’s trading regime. Concerning tariff barriers for goods (services do not have tariffs), WTO members must not treat any member less advantageously than any other, unless they form preferential trade agreements or customs unions. Concerning non-tariff barriers for goods, the WTO’s rules limit the circumstances in which they can be applied. A country cannot discriminate against exporters on product standards, for example. Once a ‘domestic’ standard has been imposed, it must be generalised to foreign countries’ exporters. This is especially relevant as the UK will be compliant with the EU’s standards on Brexit Day.
Turning to services, the WTO’s General Agreement on Trade in Services (GATS) also operates on the principle of non-discrimination. Outside preferential agreements and restrictions on market access must be applied uniformly across all countries. Any trade disputes, whether for goods or services, between member states are dealt with by the WTO’s Dispute Settlement System (DSS).
Thirdly, the WTO has made huge strides in facilitating trade across customs borders in recent years. Under the landmark Trade Facilitation Agreement (TFA), developed countries with adequate resources are expected to install state-of-the-art border systems in order that trade should not be impeded. Most countries now permit traders to submit their customs documentation electronically in advance of the goods arriving at the border. Virtually all submissions of the EU’s own Single Administrative Document (SAD), for declaring imports and exports, are now made online, for example. This means that most trade arriving from countries that are members of neither the Single Market nor the EU Customs Union suffer little or no hold-up at the border when entering the EU. There is no reason for this to change after Brexit. Streamlined, computerised borders are the norm.
The WTO No Deal is liberating
Finally, a No Deal, trading under WTO rules, unequivocally delivers Brexit. We would be outside the Customs Union and the Single Market and our institutions and laws would be supreme. It is liberating. We would, moreover, be free to use the new economic freedoms to give the economy a real boost. Outside the Customs Union, we can negotiate our own trade deals with fast-growing and friendly countries. Indeed, we would be an excellent position to negotiate a Free Trade Agreement with the EU – in a much better position than envisaged by the Political Declaration. We can also cut tariffs, for example on foodstuffs, to benefit consumers. Outside the Single Market, there is scope for regulatory modernisation and reform, to give businesses a lift, and our immigration policy can be adapted for the social and economic needs of the country. These are the economic prizes of Brexit, primarily why I voted to leave the EU. But they are largely blocked by the truly appalling Withdrawal Agreement and its unlovely sibling, the Political Declaration.
This article gives the views of the author, and not the position of LSE Brexit, nor of the London School of Economics. Its earlier version appeared on the Conservative Woman.
Ruth Lea CBE is Economic Adviser at the Arbuthnot Banking Group.
If trading under WTO is so good, why are we leaving the EU in order to facilitate making deals outside so we don’t have to trade with them under WTO. I already have American stuff, Chinese stuff etc which I have purchased under WTO so why should I have to give up the many benefits of EU membership I now enjoy.
Steve, the purpose of leaving the EU isn’t so that we can trade under WTO rules, those rules will just be the prevailing international legal framework for trade. This article is merely pointing out that that framework exists and is used effectively in the majority of world trade.
The purpose of leaving is so that we can repatriate powers over our laws, our borders and our economy.
But in the process of entering into bi-lateral trading agreements, which we will have to do if we are to survive, we will end up expatriating powers over our laws, our borders and our economy.
The problem with this discussion of ‘no deal with arrangements’ – which I agree is much more likely than a cliff-edge fall – is that there can be very little doubt what those arrangements would involve.
Yes, we can make a side agreement that keeps UK medicines regulated and moving through the rest of the EU – here are the terms required from the EMA, this is what you need to agree to – rules and regulations, payments, ECJ oversight. Same for airlines, for nuclear materials, for chemicals… same for everything.
If push comes to shove and it’s necessary to try to scrape together side agreements, the other EU states are not going to say to us “these are the rules, and the financial commitments, and the arrangements for international oversight, that we have to keep to – but you can just ignore all of that and do your own thing.” I would suggest that will never ever happen. Why on earth would France, or Germany, or Slovakia, give us that kind of advantage? This is a real question demanding an answer, not a rhetorical snort.
If that will never ever happen, then there are two other realistic possibilities. One is that we accept all of the conditions that we have rejected in order to end up with a no deal exit needing side agreements. The other is that planes stop flying.
There is a priority of issues to deal with. Brexit is now really a side-issue. The problem facing the British people, including permanent residents, is the fact that the appearances which have papered over the widening cracks in the social contract holding the country together has evaporated during the last three years, especially so during the last six months. Provided events do not overtake the analysing and enumeration of the facts, the journey sofar, since the Brexit referendum was mooted, has exposed an inexorable drift towards a seemingly unbridgeable chasm between what is likely to be a vast majority of the UK electorate, once the full implications of the rending of the social contract in the UK become apparent, and the socalled nomenklatura(a body of politically entrenched operators in government, the political party system, the Civil Service and the host of secondary supporters who make a living off legalised monopolies in both government, non-government and the huge and growing body of gravy train riders in between) on the other hand.
Bernard Connolly mentions this nomenklatura when explaining why the government and an array of very influential interests have colluded to try and make Brexit impossible. It stands to reason that people, in whatever field of endeavour, seek to protect their material-financial interests or as they perceive these so to be. In this case, they who have wished for the status quo to remain have been found to have such an influence in government as to have effectively disenfranchised the Leave vote in the referendum. This is the point Britain, and indeed all EU member countries must, and will, face, that the people entrusted with the power to govern, together with their support in the essential services, not least the BoE, have hijacked the democratic parliamentary system. The establishment parties have been exposed as driving a covert agenda quite at odds with the more overt policies offered to the electorates. Are the peoples in the EU member nation states to swallow the truth of the matter and accept that parliamentary democracy is, and has been since the Seventies, a charade? The MSM has been complicit in the soft soaping of this issue, even as the truth is becoming ever more insistent. EU philes who are not clued up on what has been contrived as per hidden agenda will sooner or later be faced with this fact: National government, the nation states’ bureaucracies and the political party system have been hijacked.
To re-iterate in brief. The Cameron government appeared to have made no effort whatever to prepare the UK for a Leave outcome in the June 2016 Brexit referendum. The EU and the UK government contrived to take a partisan position against one side, Leave/Brexit, and campaigned vigorously and even nastily, to try and persuade people against voting Leave. Then Cameron did a runner and the rest is history. The debate between Leavers and remainers has continued and never the twain shall meet. To think that humpty-dumpty can be put back together again after the dust is settled on this is ludicrous. The European peoples are faced with an unprecedented dilemma. The methods by which the globalists and EU federalists have sought to befuddle the people and peoples cannot any longer be disguised or excused. The globalists-EU federalists have hijacked the political system in European countries collectively and severally. Anyone who believes that they who are now in control will negotiate any of the power they hold away to give the franchise back is deluded. It has been fudges all the way to disenfranchise the people. It will be fudges all the way from now on, insofar as it will not be blatant, brazen and bare-faced in-your-face unilateral bulldozing and railroading.
“Brexit is now really a side-issue.”
Jacob, you’re living in a castle in the sky. Our immediate reality is Brexit which is happening in 3 months; not your airy-fairy rubbish about nomenklatura, a term you’ve misappropriated from from 20th century studies of Soviet Russia, and mis-applied to 21st century Europe.
Ruth Lea needs to be as frank as her comrade-in-arms Professor Patrick Minford about the consequences of the “liberation” she envisages. In effect the theory is that giving full reign to the lowest price provider anywhere in the world – whatever the wages or conditions of workers – would reduce prices. But what would that do to our industry and our workers? Here are quotes from Minford –
“Over time, if we left the EU, it seems likely that we would mostly eliminate manufacturing, leaving mainly industries such as design, marketing and hi-tech. But this shouldn’t scare us.
“Around half of young adults now go to university, ending up in professions such as finance or law, while the making of things such as car parts or carpentry has hugely shrunk — but there will always be jobs for people without sophisticated skills.
“Of course leaving the EU will be difficult, and something that needs careful negotiation, but we must completely withdraw to gain these benefits.”
“It is perfectly true that if you remove protection of the sort that has been given particularly to the car industry and other manufacturing industries inside the protective wall, you will have a change in the situation facing that industry, and you are going to have to run it down. It will be in your interests to do it, just as in the same way we ran down the coal and steel industries. These things happen as evolution takes place in your economy.”
As a remote observer with a keen interest in Brexit, I say, “Go for it!”
As the names suggest scenarios like Remain, Norway+, Canada++ etc have all been done before by other countries (most of them pretty boring, actually!). We can all see where you’ll end up. There is no glory in repeating the stale and predictable. The “unknown unknowns” is where the action is.
Someone has to be the first to dare that cliff edge when all the experts are screaming for you to stay home. Remember Columbus sailing off West while the “experts” expected him to fall over a waterfall?
No-deal Brexit should be embraced as an incredible opportunity to open frontiers of human knowledge and understanding. To show what the human spirit can endure. For a nation to come together and overcome i
Nothing less than “no-deal” Brexit is worthy of the daring, ingenuity and heritage of the English. Take back control and forcefully throw yourselves over the rapids!
In a way, the UK is in a struggle for independence much like other countries which were under colonial rule. The world has seen successive waves of colonisation radiating out from Europe. There have been many books on the subject, but the latest wave of European-led colonisation has turned in on itself and the analysis and academic study of the imperial-colonial mindset eating its own is only just beginning. No need to ask where the academic fraternity-sorority has been since this became public knowledge. As with some other fashionable items worthy of academic pursuit, the western world of academia has been divided in two camps. A minority is dissenting from the mainstream. The mainstream academe in the West is a collusion of collective endeavours under the aegis of controlled sheltered workshps. It is much like a play, a theatrical performance. The critics who dare expose the plot while the play is being performed are set upon, even sh*t upon. Which, from one major perspective is entirely understandable. I suppose, it spoils the denouement as a spectacular finale.
Back to colonialism; The rift, growing chasm really, between Britain and the two other major players inside the EU ring of power struggle can be directly attributed to the different modes of exercising colonial rule. The British always had a more democratic feel for the exercise of absolute rule over countries with a different sociopolitical structure, compared to the French and German rulers. I leave it to the academics to trace the authorship of this concept. I do believe it is widely known in anthropological circles. In brief; the last wave of European colonisation endeavour before the attempt to unite Europe into a federal state was in Africa.
The British were no more successful than the European continental imperial powers in leaving successful, from a European democratic perspective, self-governing entities in Africa, or hardly, but the French and German mode of rule was more autocratic, or attempted as such. One size must fit all. By now, the picture about tribal Africa is more nuanced and better understood. In Africa there was an enormous variety in ethic, social, cultural and political structures. To force the local and diverse populations in a European straitjacket, even when that straitjacket would not fit the diverse European scene, was asking for trouble. Sofar, South Africa has been amongst the least violent of African nations post-independence-sofar…
The attempt to fit the European peoples into a French-German authoritarian straitjacket would seem, from all perspective one can think of, other than a psychopathic one, doomed to massive failure. Academics who belong to the mainstream in the European political theatre do not want to know. Yes, occasionally we get the odd pro-Brexit article expounding the contrary, dissenting view. Well, how will things progress?
There are some immutable laws governing life on earth. Most of these are well-known. Some are filed under morality, some are filed under other, less attractive categories. Some of these naturally occurring laws are commonly accepted, others are nebulous or rubbery in the sense that transgressions cannot be pinned down exactly, nor the consequences directly attributed to such transgressions. Humanity learns but slowly, and mostly she learns the hard way. Academics will catch up, however, insofar as they are able to manage the events unfolding as it happens without them being willing to gain a proper understanding of such events.
Comparing EU membership to colonial rule is deeply offensive to the countries that have genuinely suffered colonial rule.
It’s particularly offensive when the comment is made by someone who is British given the country’s history, although obviously I don’t know your nationality.
@Raju “Remember Columbus sailing off West while the “experts” expected him to fall over a waterfall?” It surprises me that people still believe this legend. See https://www-istp.gsfc.nasa.gov/stargaze/Scolumb.htm . In this case Raju’s point can be made just as well using the truth. The experts back then knew Columbus wasn’t going to get to India. They didn’t know he’d find America instead. Though it would perhaps been better for those already living in America if he hadn’t!
Hi Alias — I’m really surprised that you’re appealing to facts and NASA websites in a discussion on Brexit.
I bet that if a referendum had been possible in 1490 Britain with the options of “Waterfall at Edge of World” versus “Oblate Spheroid with possible path to India”, I have no doubt absolutely as to who would have won!
(Thanks for the link though — good read!)
May I suggest that you, as a remote observer, confine your advice to your own locality where I’m sure all your fellow citizens will be perfectly happy to forcefully throw themselves over rapids for no apparent reason.
Reading this article it’s pretty clear that Ruth Lea doesn’t know very much about trade.
First off, she says that the UK conducts more than 55% of its export trade primarily under WTO rules. This is absolutely untrue. I would put the number well below 5%. To take a trading relationship I know well with the USA, absolutely none of that is done under WTO rules. There’s more than 40 trade agreements between the EU and the USA. For many businesses, it’s the loss of these non-EU trade agreements that will have more impact than the loss of EU trade itself.
Secondly, she seems to have no understanding of the Single Market. The US does not have “access” to the EU Single Market. Many US products are banned completely (just as my company’s products are banned from import to the US). Services export will be particularly badly effected both by regulation and the loss of free movement, which is particular concern as this is where the UK has a trade surplus with the EU. Finally, even in cases where the US can access the EU single market an American company may need to wait more than a year for regulatory approval to access the single market compared to the instant access the UK has.
Then we come onto tariffs. Not only are tariffs quite expensive but they can take a long time to negotiate. My business has just completed a three year negotiation to agree a tariff with HMRC. This is an enormous cost of trade.
Next we come to the problem of preparation. A simply business like mine would need at least a year to prepare for a hard Brexit. Others two to three years. We were told we didn’t need to because we would have frictionless trade and indeed Ruth Lea was was one of the people who wrote that trade would not be affected.
The British Government notes linked from the article are totally useless. Many of them are a single sheet of A4, others may run to two pages. There is absolutely no detail in them, so we wouldn’t even know how to kick of preparations.
The idea that preparations in terms of infrastructure, systems and recruitment could be completed in the few months left is absolutely ludicrous.
Finally, she assumes that if the UK walked away from its financial obligations and ended the Belfast Agreement then the EU would immediately put in place dozens of mini deals to avoid any inconvenience for the UK. At the very least there’s a high risk that this wouldn’t happen and it is certainly something that we cannot be sure of.
@Andrew. First of all, I happen to be Dutch, but I cannot see what that has to do with the price of eggs. Brexit is of immense and enduring importance for all of Europe and all those people in the world who support the rights of individuals and democracy, or tyranny. As you will have noticed if you follow the socalled debate on the net, there are many people who support a dictatorship. Some of these people do not realise the extent to which some people will go to break free of tyranny and, equally, do not realise the extent to which apparatchiks in an organisation dedicated to maintain control, and their supporting cast of nomenklatura, will go in order to maintain control. However, it is at the basis always a people’s choice. When a tension of opposing interests builds up, nothing but a deep crisis will allow a solution. The EU is good at exploiting crises, and engineering them to suit its purposes. Where this issue will take Europe and vice versa, few people, other than they who are busy engineering the next crisis, know, but anyone with an ounce of common sense knows which way the wind blows.
Your gripe about the possible adverse, for the UK, consequences has been done to death in analyses and commentary the last three years. When the Brexit referendum was first seriously put on the agenda, nobody in business or government thought to plan ahead for just that scenario. Running a business, you would have planned ahead just in case. It was a binary choice in the first instance, and still is, basically. Ahead of the referendum you could have put it as a thirty-seventy against and made some contingency plans just in case. Since 24th June 2016 you have had two and a half years to get organised. Maybe you didn’t because you had inside knowledge that it would be a total fudge, or an attempt at such. Otherwise, why did you not prepare?
Next, the difficulty of meeting a change in trading, taxing or regulatory climate. I have heard many a business or management person saying, about employees, how flexible they must be, multi skilled and able to move from one casual job to another, from one place to another, be willing to work harder for less when competing labour and skills help lower the price of lbour and skills. I’ve heard it all, over fifty years, in Western Europe and Australasia. This time it is business which has to adjust a little more than they are used to. Maybe you will lose out to competition. Well, go start another business or get a job. It’s only the very medicine which has been on offer from the business lobbies for fifty years. Suck on it. You know very well that if remainers had accepted the people’s verdict and held Cameron and May and Parliament, subsequently, to their word and vote, and May had not wasted two and a half years on this loathsome piece of a non-stop lying performance, with all the veils being drawn, sleights of hand and absolutely opposing statements and assertions, your job would have been so much easier. Whatever happens next, the shenanigans and mendacious subterfuge of the last three years will have a long-lasting impact in Britain and in Europe.
@Andrew is absolutely right. Even if Ruth Lea et al rubbish what the Treasury and Bank of England say, do they have no regard for what the overwhelming majority of business and industrial leaders who are involved in international trade are saying? Right now many of them are trying to raise support for the Prime Minister’s deal even though they are well aware that it is flawed. Why? Because they are fearful that the alternative would be the “no deal” brexit which they know would be an utter disaster – not just in the short term but for many years to come. Somehow parliament must see to it that the alternative is made available of allowing a public rethink in the light of developments that no-one could have fully foreseen in June 2016 when “have cake and eat it” reigned supreme.
As for our flying Dutchman Jacob Jonker words fail me. What he is expressing, if taken seriously, are the kind of attitudes that, taken to the extreme, can lead to the sort of warlike situation which our wise forefathers sought to eliminate when they set in motion the close co-operation which led our continent to the EU of today – still a work in progress but one of the finest world developments in my long lifetime.
Ruth Lea appears to be labouring under a number of misunderstandings regarding the nature and implications of a “No Deal” scenario as well as the realities for the UK of continuing its trade relations purely on the basis of WTO rules.
“No Deal” refers to a situation in which there is a withdrawal from the EU without an agreed Withdrawal Agreement (WA). The WA is nothing like a trade deal. It only covers a small number of preliminary arrangements. These are: any outstanding contributions to the EU finances based on commitments entered into by the UK prior to its decision to leave; the formalisation of the rights of expatriate EU citizens; a provision for the status of Northern Ireland aimed at preventing the emergence of a “hard border” between NI and the ROI (the so-called “backstop”).
The WA also includes, at the request of the UK, a transition/implementation period, without which the UK would struggle (even more) to adjust to the entire upending of all its trading arrangements in time to prevent any severe economic shocks. The WA will be accompanied by a non-binding political declaration which indicates (very vaguely at this point) the intended direction of travel towards an eventual trade agreement. Based on the UK’s abject failure to know its own mind so far and the inevitable creeping pace of the negotiations as a result of its indecisiveness, the final trade agreement is not likely to be finalised within a decade.
If there is no agreed WA (No Deal), there is no transition period. If this were to happen, a number of consequences would inevitably follow at the end of this coming March. There would be an immediate transfer of the UK to third country status, with trade only possible on WTO terms. This is so normal that the only country in the world to be in this position is Mauritius. As yet, there don’t appear to be any bilateral treaties lined up by Dr Fox that might fill this void.
WTO rules would require an immediate hard border on the island of Ireland. Quite apart from a very real risk of a return to sectarian hostilities which Leave voters appear intensely relaxed about, it would mean that the UK would be in breach of the GFA. A great way to start one’s new life as an independent negotiator of deals: renege on the ones you’ve already signed.
A No Deal withdrawal would also create an immediate hard border with the continent, as the UK would no longer be part of the EU’s internal market. This means customs checks and tariffs. If no tariffs on imports from the EU, WTO rules require no tariffs on imports from elsewhere, which means the UK market will be flooded with products cheaper than they can be produced in Britain. This is nice for consumers (provided the UK can find a way to maintain safety standards) but not so nice for manufacturers and farmers, who will soon find themselves going bankrupt.
The resulting chaos at the ports and on the roads, for which no real preparations have been made, would choke JIT delivery systems of food and essential parts for manufacturers. And yes, there would be no automatic mutual recognition of standards, which means that aeroplanes might not be insurable. And therefore not able to fly. Of course, the EU could take steps to mitigate the worst of the damage and inconvenience, but that would be entirely up to them and not necessarily in accordance with UK priorities. A No Deal Brexit would be very damaging to the EU as well, but ask yourself how well-disposed you would be towards a business partner who’d be willing to inflict that kind of damage on you. It would appear that even Mrs May is not delusional enough to risk that particular scenario.
I would be the first to agree that the proposed WA now on the table, as negtiated by Mrs May, puts the UK in a deeply unhappy and unfavourable position. Its only saving grace is that a No Deal would be worse.
The three real choices facing the UK are now May’s Deal, No Deal or No Brexit. Given that Brexit is not the solution to most of the problems faced by the UK, and in fact will create a whole set of additional ones, why not listen to the half of the country that advocated Remain?
Ruth,
I wonder if you can say something about the implications of relative tariff incomes under WTO.
We import 24% more from the EU than we export. So if both parties charge the same rate tariff, the UK receives £124 for every £100 the EU receives. In principle, the UK government can keep £24 for itself and use the £100 to give targeted tax cuts to exporters.
But the people in the UK would pay a lot more for their shopping. And we’re talking food. So basic necessities, in a country already awash with food banks. Who would willingly inflict that on a population struggling already as a result of years of austerity, precarious jobs and stagnant wages? Just for the illusion of regaining “sovereignty”, which would then immediately be relinquished to the WTO.
That’s 150+ countries to negotiate with, rather than just 27.
This is real people’s lives we’re talking about.
According to Lord David Owen, we need to give 12 months notice to discontinue our membership of the EEA and we could choose to trade under EEA (but not Efta) conditions after we leave the EU. If I understand him correctly we could then revert to WTO terms by giving 12 months notice when we are ready.
http://www.lorddavidowen.co.uk/
@TJ we the consumers pay for those import tariffs in the form of more expensive consumer goods. Not particularly desireable.
Insane. The UK mainly benefits from FDI s as the gateway to the rest of the EU.
No more EU, no more FDI and foreign organisations relocating to avoid tariff barriers.
The UK could become a free trade country. No tariffs, low taxes, low inflation, low unemployment, and lots of economic efficiency, keeping the best of the ex EU regulation and ditch the rest.
How did our Country manage before we entered into the EU in the beginning. We flew planes across all Countries then had visas to enter them too.
I am not politically minded I am just a hard working person all my life who voted for people to run our Country. They give promises of this and that to lure your vote but none of them seem capable of running it. Has our Queen even spoken about the deal or no deal issues.
Thanks for your comments.
Why didn”t Ruth say that RoI would be in breach of GFA if it imposed a border?
It cuts two ways.
”Clearly, a No Deal outcome has to be prepared for. It has to be ‘managed’. It would be the height of negligence if the British Government and/or the EU failed to be fully prepared.”
The important word here is “if”.
Christ on a bike, have seen the feckless muppets that “run” our country?
Clearly you’re a recent visitor to this planet.