The economic consequences of Brexit (Vol 3)
Discussion
Dr Jekyll said:
p1stonhead said:
wc98 said:
Dr Jekyll said:
But WTO rules still apply.
They can't obstruct trade without good reason., which primarily means safety standards.
Since there has been frictionless trade between the UK (rest of) the EU for 40 odd years without issue, it's going to be a bit tricky to argue that some peril is waiting across the border for the day we leave the EU.
this^ the only difference is we will no longer be a member of a political union. since people seem to like golf club analogies here is another. someone owns the company that supplies the food and drink to the local club house. they are also a member of the golf club. they get a debilitating disease that means they can no longer play golf so they don't pay their club membership anymore. does that mean their company can no longer supply the food and drink to the club house ?They can't obstruct trade without good reason., which primarily means safety standards.
Since there has been frictionless trade between the UK (rest of) the EU for 40 odd years without issue, it's going to be a bit tricky to argue that some peril is waiting across the border for the day we leave the EU.
PurpleMoonlight said:
wc98 said:
this^ the only difference is we will no longer be a member of a political union. since people seem to like golf club analogies here is another. someone owns the company that supplies the food and drink to the local club house. they are also a member of the golf club. they get a debilitating disease that means they can no longer play golf so they don't pay their club membership anymore. does that mean their company can no longer supply the food and drink to the club house ?
No, but the club might look for an alternative supplier.jimKRFC said:
Just to pick on the pgh/purplemoonlight/p1stonhead discussion previously.
The company I work for held a Brexit session this week for our customers. We supply industries of all sorts but the key ones are automotive (pretty much all of them), construction and pharmaceuticals. Our experince matches that of our customers and that is that
1) The UK government is listening and planning for WTO, high levels of burn out in Whitehall as a consequence
2) Industries are adjusting supply chains to handle WTO (will cost us around £50M and 4 more people to process the imports (around 500K)).
3) Infrastructure is being invested in - deep water docks in Liverpool to bypass EU customs from ROW imports.
4) The Netherlands are planning for WTO.
5) The rest of the EU are not listening to business and are not planning for anything. For example businesses are trying to register (REACH) materials in the EU and are being refused. These would normally be process in the UK (500,000,000 Eur of registrations done here) but companies (UK & EU ones) are looking to do REACH in the EU and are being refused.
Can't say who said what though as it was Charter house rules.
Sounds roughly similar to my experiences, but I'm very interested by your 5); if we're in a situation where it's actually EU countries sticking their heads in the sand about the potential issues then it could be an interesting March next year.The company I work for held a Brexit session this week for our customers. We supply industries of all sorts but the key ones are automotive (pretty much all of them), construction and pharmaceuticals. Our experince matches that of our customers and that is that
1) The UK government is listening and planning for WTO, high levels of burn out in Whitehall as a consequence
2) Industries are adjusting supply chains to handle WTO (will cost us around £50M and 4 more people to process the imports (around 500K)).
3) Infrastructure is being invested in - deep water docks in Liverpool to bypass EU customs from ROW imports.
4) The Netherlands are planning for WTO.
5) The rest of the EU are not listening to business and are not planning for anything. For example businesses are trying to register (REACH) materials in the EU and are being refused. These would normally be process in the UK (500,000,000 Eur of registrations done here) but companies (UK & EU ones) are looking to do REACH in the EU and are being refused.
Can't say who said what though as it was Charter house rules.
PurpleMoonlight said:
crankedup said:
Cuts both ways of course.
You mean like shooting yourself in the face?if every single politician in the world died tomorrow (we can but hope)do you think there would be armageddon or the world would continue to function.
p1stonhead said:
they have a different type of membership than us. we want one. they don't have to give us one. this is the crux of the matter. we are utterly at their mercy.
At the risk of getting technicalities wrong, I don't think you need any sort of membership at all to sell goods to the EU. You need to meet their regulations (example: China does this - no membership, just compliance). The purchaser must pay a tariff as appropriate (and WTO rules ensure that the EU cannot place punitive tariffs on individual countries at will). Specifically, the EU has to take extraordinary measures to 'stop' imports, and the political implications are huge.Additionally, as is pointed out again and again and again, the range of tariffs available to the EU are smaller than the recent currency fluctuations. The EU could impose maximum WTO tariffs and goods would still be cheaper than they were pre-Brexit.
So, no we are not at their mercy. At the same time, trade wars and trade barriers are stupid, and the only justification for them is politics at the expense of the individual consumer.
Tuna said:
At the risk of getting technicalities wrong, I don't think you need any sort of membership at all to sell goods to the EU. You need to meet their regulations (example: China does this - no membership, just compliance). The purchaser must pay a tariff as appropriate (and WTO rules ensure that the EU cannot place punitive tariffs on individual countries at will). Specifically, the EU has to take extraordinary measures to 'stop' imports, and the political implications are huge.
Additionally, as is pointed out again and again and again, the range of tariffs available to the EU are smaller than the recent currency fluctuations. The EU could impose maximum WTO tariffs and goods would still be cheaper than they were pre-Brexit.
So, no we are not at their mercy. At the same time, trade wars and trade barriers are stupid, and the only justification for them is politics at the expense of the individual consumer.
+1Additionally, as is pointed out again and again and again, the range of tariffs available to the EU are smaller than the recent currency fluctuations. The EU could impose maximum WTO tariffs and goods would still be cheaper than they were pre-Brexit.
So, no we are not at their mercy. At the same time, trade wars and trade barriers are stupid, and the only justification for them is politics at the expense of the individual consumer.
Dr Jekyll said:
Tuna said:
At the risk of getting technicalities wrong, I don't think you need any sort of membership at all to sell goods to the EU. You need to meet their regulations (example: China does this - no membership, just compliance). The purchaser must pay a tariff as appropriate (and WTO rules ensure that the EU cannot place punitive tariffs on individual countries at will). Specifically, the EU has to take extraordinary measures to 'stop' imports, and the political implications are huge.
Additionally, as is pointed out again and again and again, the range of tariffs available to the EU are smaller than the recent currency fluctuations. The EU could impose maximum WTO tariffs and goods would still be cheaper than they were pre-Brexit.
So, no we are not at their mercy. At the same time, trade wars and trade barriers are stupid, and the only justification for them is politics at the expense of the individual consumer.
+1Additionally, as is pointed out again and again and again, the range of tariffs available to the EU are smaller than the recent currency fluctuations. The EU could impose maximum WTO tariffs and goods would still be cheaper than they were pre-Brexit.
So, no we are not at their mercy. At the same time, trade wars and trade barriers are stupid, and the only justification for them is politics at the expense of the individual consumer.
p1stonhead said:
Happy days then considering TM seems to be looking have a brexit in name only then?
Well no, because TM's proposals appear to include things like compulsory regulatory alignment, which actually adds a rule that does put us (nominally) at the mercy of the EU. It also appears to limit our abilities to set our own trade terms with third parties, which again gives the EU more say over our future economic status whilst abandoning our ability to influence that control.
I doubt that the EU could (or would) ban three pin plugs overnight, but clearly being subject to EU control whilst not actually having membership would potentially put us at a huge global disadvantage.
This is the crux of the argument - we need to be either properly in or properly out. I'm not actually that fussed which it is, but the Referendum said out, so we need to get there without conceding power to the EU. Brexit in name only sounds fluffy and safe ("we're not really leaving"), but actually risks the most harm for the country of all the options.
Tuna said:
Additionally, as is pointed out again and again and again, the range of tariffs available to the EU are smaller than the recent currency fluctuations. The EU could impose maximum WTO tariffs and goods would still be cheaper than they were pre-Brexit.
True when the product's value originates 100% in the UK. For something like cars where you have raw materials mined, energy imported, parts sourced worldwide, the weak pound pushes up the cost of imports so the effect is much less.GBP is around 10% down on euro since the vote. Have the likes of JLR been able to drop their euro prices at all since then?
SpeckledJim said:
p1stonhead said:
they have a different type of membership than us. we want one. they don't have to give us one. this is the crux of the matter. we are utterly at their mercy.
If your pants are white, you could accomplish two important tasks at once!
p1stonhead said:
SpeckledJim said:
p1stonhead said:
they have a different type of membership than us. we want one. they don't have to give us one. this is the crux of the matter. we are utterly at their mercy.
If your pants are white, you could accomplish two important tasks at once!
SpeckledJim said:
p1stonhead said:
SpeckledJim said:
p1stonhead said:
they have a different type of membership than us. we want one. they don't have to give us one. this is the crux of the matter. we are utterly at their mercy.
If your pants are white, you could accomplish two important tasks at once!
p1stonhead said:
SpeckledJim said:
p1stonhead said:
SpeckledJim said:
p1stonhead said:
they have a different type of membership than us. we want one. they don't have to give us one. this is the crux of the matter. we are utterly at their mercy.
If your pants are white, you could accomplish two important tasks at once!
silentbrown said:
True when the product's value originates 100% in the UK. For something like cars where you have raw materials mined, energy imported, parts sourced worldwide, the weak pound pushes up the cost of imports so the effect is much less.
For sure. But then, isn't that an argument for being able to set our own tariffs and trade deals so we can reduce the costs of raw materials, energy imported, parts source etc. and remain competitive? Wouldn't it be ridiculous to leave and then continue to inflict rules that were set to restrict our efficiency?silentbrown said:
GBP is around 10% down on euro since the vote. Have the likes of JLR been able to drop their euro prices at all since then?
Why would they? They've been hammered by dieselgate, anything that helps the bottom line would be welcome, I'm sure.wc98 said:
PurpleMoonlight said:
crankedup said:
Cuts both ways of course.
You mean like shooting yourself in the face?if every single politician in the world died tomorrow (we can but hope)do you think there would be armageddon or the world would continue to function.
Tuna said:
silentbrown said:
True when the product's value originates 100% in the UK. For something like cars where you have raw materials mined, energy imported, parts sourced worldwide, the weak pound pushes up the cost of imports so the effect is much less.
For sure. But then, isn't that an argument for being able to set our own tariffs and trade deals so we can reduce the costs of raw materials, energy imported, parts source etc. and remain competitive? Wouldn't it be ridiculous to leave and then continue to inflict rules that were set to restrict our efficiency?silentbrown said:
GBP is around 10% down on euro since the vote. Have the likes of JLR been able to drop their euro prices at all since then?
Why would they? They've been hammered by dieselgate, anything that helps the bottom line would be welcome, I'm sure.Lower prices: Surely the benefit of the weak pound is that our goods are cheaper so we sell more. If demand isn't elastic in that way, just hike the prices regardless, surely? And JLR have certainly been suffering with lower sales in the EU.
silentbrown said:
Trade deals. Setting our own tariffs and making trade deals is fine, but I find it hard to square with destroying the "trade deal" we already have that accounts for 40%+ of our international trade. Frying pan and fire.
Because hand-in-hand with the 40% comes a protectionist fence that constrains our contact with the 60%.And the 40% is falling every year.
And the wealth in the RoW is much greater, and growing, whereas the EU is sliding towards a collapse.
The longer we wait with the EU, the worse the inside
utside ratios get.silentbrown said:
Trade deals. Setting our own tariffs and making trade deals is fine, but I find it hard to square with destroying the "trade deal" we already have that accounts for 40%+ of our international trade. Frying pan and fire.
The Referendum was never about which trade deal we preferred, was it? It was whether we wanted to be members of the EU, with all that entailed.If EU membership was just a trade deal, then it would (arguably) have been an issue for the government to decide. The fact that the remit has grown somewhat since we first joined is the whole point of the argument, and the reason for taking it to the people.
Agreed, changing trading conditions is a big deal - but that's not a reason for pulling our punches in the negotiations, is it?
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