The economic consequences of Brexit (Vol 2)
Discussion
Tuna said:
PurpleMoonlight said:
I've asked it many times, if free trade what such a utopia why isn't everybody doing it?
Mainly because lobby groups and hand wringing apologists fight to 'protect' internal markets.There are of course strategic and nostalgic reasons to preserve certain industries, but the focus should be on supporting them directly rather than indirectly hurting every last consumer in the name of protectionism.
Also of course that politicians tend not to be very bright.
PurpleMoonlight said:
Using Google.
UK GDP is approx £2Tn.
UK exports to EU £2.2Bn
So 11% of GDP.
EU27 GDP is approx £16Tn
EU27 exports to UK £2.9Bn.
So 2% of GDP
How sensitive are those exports to tariffs? Surely that is a key point? Do tariffs mean that those exports won't happen or that they will be simply more expensive?UK GDP is approx £2Tn.
UK exports to EU £2.2Bn
So 11% of GDP.
EU27 GDP is approx £16Tn
EU27 exports to UK £2.9Bn.
So 2% of GDP
What does the EU gain by NOT offering free trade? It's quite obvious what they lose
PurpleMoonlight said:
///ajd said:
So you've no idea why the numbers are wrong, but they don’t present the whole story.
Interesting, I’m seeing a pattern.
How is total EU export / EU export to UK as a %, and comparing that to total UK export / UK export to EU as % not exactly what should be compared?
It seems to be wrong in your mind as it undermines the argument that the EU need us more than we need them. Sorry to bring facts to the table.
Ideally the value of exports should be compared to GDP I would think.Interesting, I’m seeing a pattern.
How is total EU export / EU export to UK as a %, and comparing that to total UK export / UK export to EU as % not exactly what should be compared?
It seems to be wrong in your mind as it undermines the argument that the EU need us more than we need them. Sorry to bring facts to the table.
a) the EU are even better at exporting overall than the UK so it matters to them more. How can they be doing well at exporting when in the dreaded shackles of the EU?
b) the EU are worse are exporting overall than the UK so it matters to them less.
EU GDP is about 18 trillion, so exports of 1.8trillion is about 10%
UK GDP is about 3 trillion, so exports of 300billion is about 10%
Looks fairly even.
So it can come down to the 44% / 16% where between us, a UK/EU deal matters more to us to our GDP by a factor of 3.
///ajd said:
Tuna said:
///ajd said:
It is still surprising to see how some brexiteers don’t seem to realise that tariffs are a barrier to incoming exports, applied deliberately to protect domestic interests.
Hence when we face barriers externally, it affects exports.
Do these brexiteers realise that our exporters need tariff free trade into foriegn countries and notably the EU?
How many times do we have to explain protectionism to you? Personally I think the domestic coffee growers of the UK would be better served by subsidies than making every coffee drinker in the UK pay extra for their morning drink.Hence when we face barriers externally, it affects exports.
Do these brexiteers realise that our exporters need tariff free trade into foriegn countries and notably the EU?
The whole point of lowering tariffs is that we don't want to get into a war of protectionism and ever rising barriers to trade.
Why on earth do you think that only Remainers have the deep insight that we want to trade as freely as possible with foreign countries, including the EU?
Yes or No?
You seem to argue it for one side (ours, to get cheaper stuff), but are silent on the other.
sidicks said:
How sensitive are those exports to tariffs? Surely that is a key point? Do tariffs mean that those exports won't happen or that they will be simply more expensive?
What does the EU gain by NOT offering free trade? It's quite obvious what they lose
I don't know.What does the EU gain by NOT offering free trade? It's quite obvious what they lose
The EU does offer free trade. Hopefully we will agree that.
PurpleMoonlight said:
I think I have billions and trillions mixed now 
UK GDP is approx £2Tn.
UK exports to EU £0.22Tn
So 11% of GDP.
EU27 GDP is approx £14Tn
EU27 exports to UK £0.29Tn.
So 2% of GDP
LOLUK GDP is approx £2Tn.
UK exports to EU £0.22Tn
So 11% of GDP.
EU27 GDP is approx £14Tn
EU27 exports to UK £0.29Tn.
So 2% of GDP
You show 5:1, mine 3:1.
Its a big difference no matter how you play it.
Probably a $ FOREX error in mine somewhere too but it makes little difference to the overall conclusion.
///ajd said:
Tuna - is it important for our exporters to have tariff / barrier free trade into the EU?
You seem to argue it for one side (ours, to get cheaper stuff), but are silent on the other.
Yes, it's absolutely beneficial to us. However, we have to recognise that in that respect the EU is a heavily protectionist organisation that finds it very difficult to agree changes. So we cannot really expect them to pull a rabbit out of the hat for us - and shouldn't be surprised if we end up with some barriers to trading.You seem to argue it for one side (ours, to get cheaper stuff), but are silent on the other.
The challenge here is to minimise (not eliminate at all costs) those barriers, and to ensure that any agreements we make allow us to trade freely with the rest of the world (our largest export market, and growing). In respect of trading alone, the WTO backstop is important - we don't want to enter into an agreement with the EU that makes external trade difficult. A customs union in some respect seems to me to be the worst of all worlds - where we have lost our influence, but still have to abide by trade rules that prevent us from freely joining the world stage.
///ajd said:
PurpleMoonlight said:
///ajd said:
So you've no idea why the numbers are wrong, but they don’t present the whole story.
Interesting, I’m seeing a pattern.
How is total EU export / EU export to UK as a %, and comparing that to total UK export / UK export to EU as % not exactly what should be compared?
It seems to be wrong in your mind as it undermines the argument that the EU need us more than we need them. Sorry to bring facts to the table.
Ideally the value of exports should be compared to GDP I would think.Interesting, I’m seeing a pattern.
How is total EU export / EU export to UK as a %, and comparing that to total UK export / UK export to EU as % not exactly what should be compared?
It seems to be wrong in your mind as it undermines the argument that the EU need us more than we need them. Sorry to bring facts to the table.
a) the EU are even better at exporting overall than the UK so it matters to them more. How can they be doing well at exporting when in the dreaded shackles of the EU?
b) the EU are worse are exporting overall than the UK so it matters to them less.
EU GDP is about 18 trillion, so exports of 1.8trillion is about 10%
UK GDP is about 3 trillion, so exports of 300billion is about 10%
Looks fairly even.
So it can come down to the 44% / 16% where between us, a UK/EU deal matters more to us to our GDP by a factor of 3.
One would only reach those conclusions by ignoring several factors in arriving at those figures.
Just for one, over 80% of the exports of the EU to the UK come from 1/3 of the members. 1/2 of that comes from Germany.
sidicks said:
Only to other EU countries. And actively prevents are trade outside of that. As ///adj himself has highlighted, trade between the EU and UK is declining...
You are confusing the single market with free trade.The EU has numerous FTA's although none with economies the size of ours.
I don't see May getting her 'deep and special partnership' though. The EU don't want that.
REALIST123 said:
One would only reach those conclusions by ignoring several factors in arriving at those figures.
Just for one, over 80% of the exports of the EU to the UK come from 1/3 of the members. 1/2 of that comes from Germany.
Germany exports to UK - 7%
Next!
PurpleMoonlight said:
You are confusing the single market with free trade.
The EU has numerous FTA's although none with economies the size of ours.
I don't see May getting her 'deep and special partnership' though. The EU don't want that.
Numerous in number or numerous in value / % of GDP?The EU has numerous FTA's although none with economies the size of ours.
I don't see May getting her 'deep and special partnership' though. The EU don't want that.
Are they with countries that the UK has significant trade with?
Tuna said:
Greg66 said:
Tuna said:
It seems hard to grasp, but tariffs hurt the country that applies them,
<snip>
which is why the WTO seeks to limit them rather than encourage them.
Been out. Was going to say that the first statement is obviously not right - see the second (and Trump's tariffs on Bombardier). But others have done it already. <snip>
which is why the WTO seeks to limit them rather than encourage them.
a) Add no tariff - and benefit from a good we can get cheaply elsewhere
b) Add enough of a tariff that we can have a 'competitive' local market in phone manufacture
Tariffs hurt us. They might slightly reduce the number of foreign phones (cars, chocolate, whatever) we choose to buy, but we're just one export market to those producers (as the Remain crew keep reminding us) - so why should they care if we turn phones into 'luxury goods'? They can still sell to everyone else and watch the UK go back to tin cans and string.
And it you think that tariffs improve trade, try reading this
https://tradebetablog.wordpress.com/2016/08/18/eu-...
or this:
http://www.tuaeu.co.uk/how-the-eu-starves-africa/
a) Add no tariff - and benefit from goods we can get cheaply elsewhere at the expense of our domestic steel industry
b) Add enough of a tariff that we can have a 'competitive' local market in steel
What the WTO says about tariffs: Customs duties on merchandise imports are called tariffs. Tariffs give a price advantage to locally-produced goods over similar goods which are imported, and they raise revenues for governments.
https://www.wto.org/english/tratop_e/tariffs_e/tar...
///ajd said:
REALIST123 said:
One would only reach those conclusions by ignoring several factors in arriving at those figures.
Just for one, over 80% of the exports of the EU to the UK come from 1/3 of the members. 1/2 of that comes from Germany.
Germany exports to UK - 7%
Next!
https://www.destatis.de/EN/PressServices/Press/pr/...
Ghibli said:
Just in case anyone is interested in how the Germans are getting on?
https://www.destatis.de/EN/PressServices/Press/pr/...
So Germany exports up ~5% since ~Brexit vote.https://www.destatis.de/EN/PressServices/Press/pr/...
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