No, but it does mean (at least in the short to medium term) massive hikes in inbound and outbound tariffs. The fact that there are no WTO rules for services (which is what a lot of the UK economy is based on) is also brushed under carpet.Originally Posted by TeePee
There will be no winners, in the event of no mutually agreeable deal. But .... those 27 aren't equal, and our trade with many is tiny. With the big ones, notably Gernany, we have a very large deficit, as indeed we do with the 27 as a whole. Last time I looked, we imported about £70bn/year more than we exported.
For quite a large percentage of what we import, we can also look to other countries for supply, but it's far harder for the EU to similarly replace export markets. For instance, as a micro-level example, personally, I'm buying things like cars from the Far East in the future, instead of BMW, Mercedes, VW etc, and will be looking at LG or Samsung, etc, for freezers, washing machines, etc.
It is nowhere near as simple as 27 versus 1, but it'll hurt both sides, at least short-term, in the absence of a deal, but a mutually acceptable one.
There will be winners, it'll be Rees-Mogg and his disaster-capitalist mates.
But your far-eastern car and washing machine will be coming in with tariffs on, rather than coming in under the FTAs the Eu already has in place.
I'm not arguing that the EU will lose out, they will, but they're not losing as much as we are. My argument was against the assertion that the EU will be hurt far more than we will be.
The EU is not a homogenous trade entity. Some states have a relatively small economy of which trade with us is not a huge factor, some have small economies of which trade with us is central, and some have very large economies and reduced trade with us will really hurt, but they can bear it. My point was that trade "hurt" is not uniform.
As for far-eastern FTA's, that depends on how keen those countries are to take advantage of market opportunities. Some will no doubt take time, others have indicated they want to move really fast. Nobody will know for sure about either until, first, we're out, and second, deals are done.
If Johnson had taken the recent approach within days of becoming PM, I think that -some- people might have given him the benefit of doubt (myself and probably a number of conservative MPs who defied the whip.
But that prorogation nuked the bridge and wrecked most good will and if he ends up stuck either at the parliament or during EU negotiation, I wouldn't buy the narrative that it is the other's fault and not his.
Heck, I am probably a fool for even considering that maybe he has finally started to try a little.. although even if I was to accept that extremely remote possibility, it is rather late. As someone who doesn't approve Trump's playbook, I wouldn't want anyone succeed using a page off that playbook.. or in Johnson's case, plagiarise 80% of that playbook.
The most exposed EU member is belgium, with 7% of their GDP exports to the UK (EU average is 2.3%). 8% of UK GDP is exports to the EU, and we don't have EU emergency funding to help fill the gap.
Including services make the comparison even worse, 7% of UK GDP is services to the EU whereas only 1% of the EU GDP is services going the other way. Yes, there's a trade surplus, but the EU is substantially richer than we are so it matters less for them.
Top_gun (07-10-2019)
James F. of the Spectator wrote this pieces today:
https://blogs.spectator.co.uk/2019/1...-negotiations/
"Earlier today, I sent a message to a contact in Number 10 asking them how the Brexit talks were going. They sent a long reply which I think gives a pretty clear sense of where they think things are.
So, in the interest of trying to let people understand where Number 10 reckon the negotiations are, here is their response:
‘The negotiations will probably end this week. Varadkar doesn’t want to negotiate. Varadkar was keen on talking before the Benn Act when he thought that the choice would be ‘new deal or no deal’. Since the Benn Act passed he has gone very cold and in the last week the official channels and the backchannels have also gone cold. Varadkar has also gone back on his commitments — he said if we moved on manufactured goods then he would also move but instead he just attacked us publicly. It’s clear he wants to gamble on a second referendum and that he’s encouraging Barnier to stick to the line that the UK cannot leave the EU without leaving Northern Ireland behind.
There are quite a few people in Paris and Berlin who would like to discuss our offer but Merkel and Macron won’t push Barnier unless Ireland says it wants to negotiate. Those who think Merkel will help us are deluded. As things stand, Dublin will do nothing, hoping we offer more, then at the end of this week they may say ‘OK, let’s do a Northern Ireland only backstop with a time limit’, which is what various players have been hinting at, then we’ll say No, and that will probably be the end.
Varadkar thinks that either there will be a referendum or we win a majority but we will just put this offer back on the table so he thinks he can’t lose by refusing to compromise now. Given his assumptions, Varadkar’s behaviour is arguably rational but his assumptions are, I think, false. Ireland and Brussels listen to all the people who lost the referendum, they don’t listen to those who won the referendum and they don’t understand the electoral dynamics here.
If this deal dies in the next few days, then it won’t be revived. To marginalise the Brexit Party, we will have to fight the election on the basis of ‘no more delays, get Brexit done immediately’. They thought that if May went then Brexit would get softer. It seems few have learned from this mistake. They think we’re bluffing and there’s nothing we can do about that, not least given the way May and Hammond constantly talked tough then folded.
So, if talks go nowhere this week, the next phase will require us to set out our view on the Surrender Act. The Act imposes narrow duties. Our legal advice is clear that we can do all sorts of things to scupper delay which for obvious reasons we aren’t going into details about. Different lawyers see the “frustration principle” very differently especially on a case like this where there is no precedent for primary legislation directing how the PM conducts international discussions.
We will make clear privately and publicly that countries which oppose delay will go the front of the queue for future cooperation — cooperation on things both within and outside EU competences. Those who support delay will go to the bottom of the queue. [This source also made clear that defence and security cooperation will inevitably be affected if the EU tries to keep Britain in against the will of its government] Supporting delay will be seen by this government as hostile interference in domestic politics, and over half of the public will agree with us.
We will also make clear that this government will not negotiate further so any delay would be totally pointless. They think now that if there is another delay we will keep coming back with new proposals. This won’t happen. We’ll either leave with no deal on 31 October or there will be an election and then we will leave with no deal.
‘When they say ‘so what is the point of delay?’, we will say “This is not our delay, the government is not asking for a delay — Parliament is sending you a letter and Parliament is asking for a delay but official government policy remains that delay is an atrocious idea that everyone should dismiss. Any delay will in effect be negotiated between you, Parliament, and the courts — we will wash our hands of it, we won’t engage in further talks, we obviously won’t given any undertakings about cooperative behaviour, everything to do with ‘duty of sincere cooperation’ will be in the toilet, we will focus on winning the election on a manifesto of immediately revoking the entire EU legal order without further talks, and then we will leave. Those who supported delay will face the inevitable consequences of being seen to interfere in domestic politics in a deeply unpopular way by colluding with a Parliament that is as popular as the clap.
Those who pushed the Benn Act intended to sabotage a deal and they’ve probably succeeded. So the main effect of it will probably be to help us win an election by uniting the leave vote and then a no deal Brexit. History is full of such ironies and tragedies.’
Now, this is—obviously—only one side of the negotiations view of things. It does, though, make clear Downing Street’s pessimism about getting a deal this week and its thinking about how to handle the coming extension and election campaign."
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No surprises there.
I note that the "hostile interference in domestic politics" is the type of language frequently used by China (re: other thread).
The threat of being moved at the back of the queue for co-operation (*).. probably doesn't hold the same weight when done done by the UK than by China (**).. though, I suppose that ironically I can see China take this as an opportunity to grow their influences without doing anything differently than they would have done anyway (a weakened EU / UK without having to lift and being able to benefit from it on top of it? What's not to like), whether it is by moving to the front of the queue by default, or by buying up British assets as the pound takes a beating (or both). As a bonus, at that point I doubt that HK is going to be what this government and indeed the bulk of citizens are going to be worried about while negotiating trade deals.
(*) Given that loss of co-operation is mutually detrimental, I would consider that threat as being only half effective.
(**) I was going to point out that despite being the 5th largest economy in the world, our economy is still much smaller than China's in absolute term.. only to find out that that we've actually slipped to 7th.
Not that I hold much hope for the remain non-alliance, if I was a betting person, I would bet on another hung parliament at the next GE. A second referendum makes so much sense if only to break the impass, but unlike the GE where polls are favourable to the Tory's, polls aren't so favourable for the leavers and so they are not willing to out the "over half of the public will agree with us" to the test. Understandable I suppose.
That Spectator piece is just basically a press release from Cummings. One which continues the lie that 'We were trying for a deal, it was those others who wouldn't' when since Boris got in, he's been all about no deal, in order that his mates can short the pound and Offshore tax avoiders get a reprieve.
Biggest bait and switch ever.
neonplanet40 (11-10-2019),Top_gun (18-10-2019)
Can someone confirm why, exactly, the President of the EU parliament would be talking to the UK Speaker of the House about Brexit etc. and not to the Prime Minister?
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I am going to reassert that.
While there might be some truth in needing to be able to walk away in a negotiation, the credibility of such threat only stands if it is more damaging to the opposing party.
Yet one of two things is happening if the observer piece is the official stance:
A. This government mean what it is saying, and it is willing to pick a mutually destructive option as the price of Brexit. I am sure there are people who would only love to see this happen, and they aren't nearly as friendly as the EU. I question if this is what most Leavers voted for, especially with all the "Easiest deal in human history" and whatnot.
B. The government is bluffing, yet believes that such a bluff is somehow credible.
Either would be incredibly stupid, though I am still trying to decide which one is worse.
It lends some credence to the rumour that the Surrender Act was written by, or with the assistance of, the EU.
It's very clear, at this point, that the Act was designed not to prevent 'No Deal', but to prevent the Government from negotiating a deal.
Mr_Jon (10-10-2019)
Progress.....?
https://twitter.com/GuidoFawkes/stat...235419648?s=20
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Looking that way
https://uk.reuters.com/article/uk-br...-idUKKBN1WP0OO
Reuters have managed a whopping four paragraphs on what sounds like a significant development
https://uk.reuters.com/article/uk-br...-idUKKBN1WV24R
I think we just have to wait and see. It looks increasingly possible, which fits with common predictions that nothing would happen until 11th hour, but we need to bear in mind that few details of what the putative deal entails are out yet and, even assuming the UK govt and EU negotiators agree it all, and tie it in a pretty pink ribbon, it still has to get past the UK parliament, 27 other member states some of which, IIRC, require parliamentary ratification, and the EU parliament.
Whether it even gets past UK MPs is lilely to depend on, in detail, what's in it. The SNP said (or at least, were reported as saying) a few days ago they wouldn't support any deal formulated by BoJo. The LibDems have a decision to make, if a deal is reached - suppirt it and risk a NoDeal exit being the end result, or try to block it and hope to revoke art.50, which is what they really want anyway.
And there's the wildcard - the DUP. Who knows what they'll do, and a good number of Tory MPs may well take a cue from them, if they nix it
So even if a deal is "done" it's still got a long way to go, and not much time, before it's really done.
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