The economic consequences of Brexit (Vol 2)
Discussion
Coolbanana said:
So sod the 4 Freedoms, the Foundations of the EU and give the UK a special deal on Trade only - something no other country in Europe has?
Both Norway and Switzerland have different deals from any other country, unique deals in other words. Why should the UK have to cut and paste an existing deal?Mrr T said:
Firstly, Sway may I thank you for your replies on the other thread. I apologise other commitments meant I could not respond. No probs, I'll retract my slight churlishness earlier! Breadvan is still on my naughty list though... 
I hope you do not mind if I ask more questions on the IP process.
1. I questioned whether the process would quick enough to deal with movements by lorry which might only take a few hours to reach the tunnel. In your previous post you said using the process to facilitate lorry movement was not a problem because the movements where scheduled far in advance. Now I am sure there are plans for lorry movements but I am sure these get changed. So I still struggle to accept that the system designed to handle goods moving by a small number of ships will handle good moving by very large number of lorries.
The consignment is planned in advance. The actual dates/times are irrelevant, the consignment details are pre-loaded, whenever it arrives it is 'ticked off'. Transit time or scheduling really are irrelevant. In the exceptionally rare occasion that a company has to do things in an unplanned way (really very rare in today's era of MRP being king and Lean driving the globe), then you'd simply pay the tariff at the point of entry, then claim it back a month later...
2. I asked about system capacity and you only confirmed their where no system capacity issues for the users of the system. This I accept. However, my question was about the capacity of the HMRC systems to handle a many fold increase in volume.
I don't know. However as it's a pretty much fully automated system, I can see no reason why there would be any issue. Even if the current server capacity isn't sufficient, it is not generally a huge challenge to increase capacity of digital systems retaining the same capability as previously.
3. you also stated all lorries crossing the channel are checked by HMRC. I expect they monitor a small number for duty paid goods but all? Immigration is a Border Force matter. As far as I am aware very few lorries are inspected. Introducing a system where a significant number of lorries have to be stopped and inspected and the data compared to a system will take time. Since this will be happening both sides of the channel I have to feel we are going to get delays.
Check doesn't mean inspection. The documentation for every single lorry/shipment/consignment will be checked. Either automatically, quick human check at desk, or a physical inspection (which themselves can vary massively in level of work, detail and thoroughness). Effectively, shipper provides the documentation of the actual shipment, system compares with what was previously submitted. System flags if behaviour appears risky, additional checks occur if this is the case. There may well be delays, however as previously stated one of the advantages of both us as an island trading nation and the entry/exit points within the EU is that these border points are a) numerous, b) highly competitive, and c) very commercially minded. It is in the interests of ABP (for example) to provide the service at Southampton that attracts trade to them as opposed to Felixstowe. Hence the vast levels of investment Holland has put into ensuring they are the key 'hubs' for Continental Europe at both Rotterdam and Schipol. The majority of any human effort is low skilled and a mix of administrative tasks and physical checks. I'd posit that the human capacity could be increased pretty rapidly too and at fairly low costs.
For goods/components destined to remain in the UK, it is not applicable. Those are subject to the tariff regime set by our government post-Brexit, and I have posted previously that my personal preference would be for us to unilaterally eliminate tariffs (note, not barriers against substandard goods or dumping, etc.). For those destined for export, then it does apply, and means that UK companies and those items do not carry an overhead caused by the UK's tariff regime. The context was a comment regarding items moving back and forth across the channel, as though at each stage an extra 10% would be added to the cost base, which is not the case.
The driver here is capacity and capability. Much like Rotterdam is the de facto driver of containerised shipping for Europe, London is the de facto facilitator of financial services. This isn't going to change anytime soon - partially based on the human factors, partly due to the technical challenges, partly due to the market's perception of security. The annual assessment of FS cities globally has seen London not move down the rankings due to the challenges, risks or market forecasts for Brexit, but in fact extend it's lead over New York, with the biggest gap seen in modern times... I hope you do not mind if I ask more questions on the IP process.
1. I questioned whether the process would quick enough to deal with movements by lorry which might only take a few hours to reach the tunnel. In your previous post you said using the process to facilitate lorry movement was not a problem because the movements where scheduled far in advance. Now I am sure there are plans for lorry movements but I am sure these get changed. So I still struggle to accept that the system designed to handle goods moving by a small number of ships will handle good moving by very large number of lorries.
The consignment is planned in advance. The actual dates/times are irrelevant, the consignment details are pre-loaded, whenever it arrives it is 'ticked off'. Transit time or scheduling really are irrelevant. In the exceptionally rare occasion that a company has to do things in an unplanned way (really very rare in today's era of MRP being king and Lean driving the globe), then you'd simply pay the tariff at the point of entry, then claim it back a month later...
2. I asked about system capacity and you only confirmed their where no system capacity issues for the users of the system. This I accept. However, my question was about the capacity of the HMRC systems to handle a many fold increase in volume.
I don't know. However as it's a pretty much fully automated system, I can see no reason why there would be any issue. Even if the current server capacity isn't sufficient, it is not generally a huge challenge to increase capacity of digital systems retaining the same capability as previously.
3. you also stated all lorries crossing the channel are checked by HMRC. I expect they monitor a small number for duty paid goods but all? Immigration is a Border Force matter. As far as I am aware very few lorries are inspected. Introducing a system where a significant number of lorries have to be stopped and inspected and the data compared to a system will take time. Since this will be happening both sides of the channel I have to feel we are going to get delays.
Check doesn't mean inspection. The documentation for every single lorry/shipment/consignment will be checked. Either automatically, quick human check at desk, or a physical inspection (which themselves can vary massively in level of work, detail and thoroughness). Effectively, shipper provides the documentation of the actual shipment, system compares with what was previously submitted. System flags if behaviour appears risky, additional checks occur if this is the case. There may well be delays, however as previously stated one of the advantages of both us as an island trading nation and the entry/exit points within the EU is that these border points are a) numerous, b) highly competitive, and c) very commercially minded. It is in the interests of ABP (for example) to provide the service at Southampton that attracts trade to them as opposed to Felixstowe. Hence the vast levels of investment Holland has put into ensuring they are the key 'hubs' for Continental Europe at both Rotterdam and Schipol. The majority of any human effort is low skilled and a mix of administrative tasks and physical checks. I'd posit that the human capacity could be increased pretty rapidly too and at fairly low costs.
Sway said:
As I've posted repeatedly on here and on other threads, having a tariff border with the EU is not the massive problem it's presented as. Firstly, it only effects finished goods. Components being shipped through global supply chains are eligible for Inwards Processing Relief, and do not have any tariffs.
Reading the HMRC web site it seems to apply to all goods whether finished or not. Also only a limited number of goods are covered by IP most goods are for import. For goods/components destined to remain in the UK, it is not applicable. Those are subject to the tariff regime set by our government post-Brexit, and I have posted previously that my personal preference would be for us to unilaterally eliminate tariffs (note, not barriers against substandard goods or dumping, etc.). For those destined for export, then it does apply, and means that UK companies and those items do not carry an overhead caused by the UK's tariff regime. The context was a comment regarding items moving back and forth across the channel, as though at each stage an extra 10% would be added to the cost base, which is not the case.
Sway said:
Further, over 80% of retail lending within Germany is facilitated via London. That will not change, for so many reasons it's boring to type them out.
This is something I do know about. I also assume you mean wholesale rather than retail? So please tell me why the UK is so important because I do not know. The issuance market is not driven by the bankers in the middle, that a very competitive market. The drivers for the market are the issuers and the buyers of the issuance. If they are based in the EU (and about 70% of the market are) and the UK losses passporting the people selling to the main drivers of the market will also have to be based in the EU and not in the UK.Coolbanana said:
So sod the 4 Freedoms, the Foundations of the EU and give the UK a special deal on Trade only - something no other country in Europe has?
It's not a question of sod this or sod that.....rather its a case of trade, and in that case the best target to aim for is a special trade deal for the UK and EU. One that is mutually beneficial? After all, the 5th largest economy in the world is on the EU's doorstep....one might assume that the EU would have some interest in trying to sell us stuff? Coolbanana said:
Is it arrogance that makes some Brexiters think the UK deserves special treatment over all other Nations? 
is it rudeness or lack of imagination that makes some Remainers resort to abuse whenever they seek to make a point? The UK deserves a unique deal because it is the 5th largest economy on the planet. It also starts on day one as 100% compliant with EU regs. Any reluctance to make a sensible deal with the UK on the part of the EU, notwithstanding the 70 billion trade deficit in the EUs favour will reveal only one side as an ideologically driven monster determined to hurt itself - and that aint the UK
Coolbanana said:
The EU should tell the UK to either accept a deal similar to Norway (daft, why not just be a full Member and have some influence) or leg it and go WTO.
Should it now? Well thanks for your considered opinion. It's to be hoped that the EU has a bit more sense up its sleeve than you. You just want them to say/do this because you want to see the UK suffer for not agreeing with you. As I said above, if the EU is silly enough to want WTO only then it's the EU that stands to suffer most. Aside from the fact that the EU will end up paying more in tariffs than the UK will, the EU should also consider that attempts to punish will most likely be met with boycotts of EU products by a quite a few British people. But hey, if they want it, just to please you, let them have it.
Coolbanana said:
All this 'look at us, we are so special and better than the others' is nauseating.
Oh I agree, so why do YOU keep saying it? I haven't seen or heard anyone on the UK Brexit side using that kind of language. Coolbanana said:
Have some pride. Own your decision to leave, have confidence in your convictions and leave 100%. Off you toddle.
I think that should read "off WE toddle". You don't get to stay in the EU on your lonesome! Coolbanana said:
None of this halfway house rubbish! 
Seriously though, you are either in the EU and agree to the 4 Freedoms or you are out and on your own little feet. Transition deals, preferential deals...all a bit desperate and smacks of "Oh, no! We stuffed it! We're afraid actually. How do we rescue this and still deliver something to the Electorate?"
The Majority voted Leave. So Leave.
unless you slept through it, it's more than just the UK suggesting a transition period. I don't think suggesting a transition period smacks of anything other than sense and pragmatism. But if you want to paint it as more evidence that you're right, just you keep believing it. Seriously though, you are either in the EU and agree to the 4 Freedoms or you are out and on your own little feet. Transition deals, preferential deals...all a bit desperate and smacks of "Oh, no! We stuffed it! We're afraid actually. How do we rescue this and still deliver something to the Electorate?"
The Majority voted Leave. So Leave.
Coolbanana said:
Then we can sit back and watch, with interest, see just how well the UK does fare all by itself. Oh, and no Passporting; that's preferential treatment so shouldn't be allowed.
ahh, the fall back to standard Remainer rhetoric - you'll sit back and watch watch whilst (you really really hope that ) others suffer. Niiiice. FTR, you don't get to decide on passporting or any of the other options in that area.
Coolbanana said:
None of the above is a punishment, it is what you voted for, to Leave. There were no caveats about preferential deals or halfway houses on the Ballot.
good, WTO it is then. Shame you missed on on doing a super deal with the worlds 5th largest economy on your doorstep...Coolbanana said:
You can then trade via WTO in the same way as, saaaay, Angola does with the EU.
And the USA, and China and and and and....... But you pick a war torn, poor African country as an example.....hmmm, says quite a lot about your line of thinking PurpleMoonlight said:
andymadmak said:
And the USA, and China and and and and....... But you pick a war torn, poor African country as an example.....hmmm, says quite a lot about your line of thinking
Neither of which have a special arrangement with the EU. So why should they give us one?The point Bananaman was making that we would be forced to trade just like little old Angola... etc etc as if that were a wholly bad thing.
In any event, the EU has been trying to get a deal with USA and others for years..... aligning the requirements of 20 odd nations takes some doing..
Edited to add - whereas agreeing a deal with a former member which is already fully conversant with and compliant with EU standards, and with which EU members already have long standing trading relationships built up during the membership period should be rather simpler, should it not?
(unless somebody somewhere decides to object on purely idealogical grounds - but that would be silly and childish would it not? )
Edited by andymadmak on Friday 22 September 16:29
andymadmak said:
Edited to add - whereas agreeing a deal with a former member which is already fully conversant with and compliant with EU standards, and with which EU members already have long standing trading relationships built up during the membership period should be rather simpler, should it not?
(unless somebody somewhere decides to object on purely idealogical grounds - but that would be silly and childish would it not? )
The EU have repeatedly said the UK cannot expect better or same trading from outside the EU. Many people seem not to believe them.(unless somebody somewhere decides to object on purely idealogical grounds - but that would be silly and childish would it not? )
Edited by andymadmak on Friday 22 September 16:29
I think we could get a decent FTA without much argument but May has now stated that is unacceptable to us. I dont think trying to back the EU into a corner is wise.
PurpleMoonlight said:
The EU have repeatedly said the UK cannot expect better or same trading from outside the EU. Many people seem not to believe them.
I think we could get a decent FTA without much argument but May has now stated that is unacceptable to us. I dont think trying to back the EU into a corner is wise.
I didn't say it had to be better, just sensible. I think we could get a decent FTA without much argument but May has now stated that is unacceptable to us. I dont think trying to back the EU into a corner is wise.
what has Mrs May said?
Coolbanana said:
think the UK deserves special treatment over all other Nations?
The EU has free trade agreements with 33 countries. All of them are slightly different - some very different. It isn't about being special it is about trying to agree a deal which is mutually beneficial and suitable for the UK and EU. An off the shelf one isn't necessarily suitable (for the EU as well as the UK), I mean why not just take the one with Mexico and use that? Because that was tailored for EU-Mexico that is why. Incidentally, it also has another 10 (all different) signed FTAs in various stages of ratification and implementation including CETA.
PurpleMoonlight said:
The EU have repeatedly said the UK cannot expect better or same trading from outside the EU. Many people seem not to believe them.
Who are these people? I'm not aware of anyone who thinks we can get exactly the same as we have now and I'm not aware that we are asking for it.confused_buyer said:
The EU has free trade agreements with 33 countries. All of them are slightly different - some very different. It isn't about being special it is about trying to agree a deal which is mutually beneficial and suitable for the UK and EU. An off the shelf one isn't necessarily suitable (for the EU as well as the UK), I mean why not just take the one with Mexico and use that? Because that was tailored for EU-Mexico that is why.
Incidentally, it also has another 10 (all different) signed FTAs in various stages of ratification and implementation including CETA.
May is clearly referring to something considerably superior to a FTA.Incidentally, it also has another 10 (all different) signed FTAs in various stages of ratification and implementation including CETA.
PurpleMoonlight said:
andymadmak said:
I didn't say it had to be better, just sensible.
what has Mrs May said?
She said in the speech today that a FTA or Norway style agreement are unacceptable. She wants a unique UK agreement. She didnt say a red white and blue agreement but might as well have.what has Mrs May said?
Anyways, unluckily for you, Mr Barnier rather likes Mrs Mays speech..
BBC website said:
On trade, she said the two sides could do "so much better" than adopt existing models and there was "no need to impose tariffs where there are none now".
PurpleMoonlight said:
The EU have repeatedly said the UK cannot expect better or same trading from outside the EU. Many people seem not to believe them.
I think we could get a decent FTA without much argument but May has now stated that is unacceptable to us. I dont think trying to back the EU into a corner is wise.
You must have watched a different speech to me.I think we could get a decent FTA without much argument but May has now stated that is unacceptable to us. I dont think trying to back the EU into a corner is wise.
PurpleMoonlight said:
The EU have repeatedly said the UK cannot expect better or same trading from outside the EU. Many people seem not to believe them.
I think we could get a decent FTA without much argument but May has now stated that is unacceptable to us. I dont think trying to back the EU into a corner is wise.
It wouldn't be "better" from the EU perspective as it wouldn't include FoM, rule by the ECJ etc.I think we could get a decent FTA without much argument but May has now stated that is unacceptable to us. I dont think trying to back the EU into a corner is wise.
A "decent" FTA is not one that mirrors the 10th or 29th biggest nations by GDP. That's selling short. A position only underscored when you look at the amount of trade the EU does with those two nations.
sidicks said:
Roman Rhodes said:
You're claiming to be "more intelligent"? Even if you believe you are, are you really that insecure that you have to spell it out?
More likely, someone having to say that they are "more intelligent" than someone else is a clear sign that they really aren't. Reading what you post I think most reasonable people would conclude that that is the case. You flatter yourself too much.
No idea what point you are trying to make - Ed was doing his usual approach and claiming other people were 'stupid', that was the background to my response. HTHMore likely, someone having to say that they are "more intelligent" than someone else is a clear sign that they really aren't. Reading what you post I think most reasonable people would conclude that that is the case. You flatter yourself too much.
PurpleMoonlight said:
May is clearly referring to something considerably superior to a FTA.
Maybe, but surely that is to the EU's advantage as well. When you look at the massive numbers of EU companies running services, engaging in public contracts, utilities, transport etc. they do have a lot to lose as well. A basic FTA isn't go to do the EU much favours either.On that note I shall hop onto a City of Paris owned/run bus.....on my way to a train run by the Government of the Netherlands and when get home I must get around to paying the French Government my electricity bill and a very large company in Munich for my water rates.....
PurpleMoonlight said:
It would.
Do you see the EU agreeing to tariff free everything but no FoM, ECJ and no payment?
They'll agree tariff free. They'll agree tariff free with loads of countries - have done and are doing so without the slightest element of FoM. It is the non-tariff barriers which are the sticking points. Do you see the EU agreeing to tariff free everything but no FoM, ECJ and no payment?
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