Brexit and related Trade Deal issues

[c-a-r-f-r-e-w]

For everything Brexit, CPTPP, TTIP, Henig etc.

[Deleted]

c-a-r-f-r-e-w Your question on CPTPP might be better phrased as would the EU join CPTPP due to FOMO if UK and some others did? CPTPP might one day become the 'new WTO' given the current one is struggling?  

Obviously the future is not set... (ie I'm not making a prediction before one of the 'gotcha' types pretends I am)

[c-a-r-f-r-e-w]

Dec 6, 2021 20:13:47 GMT @tw said:

c-a-r-f-r-e-w Your question on CPTPP might be better phrased as would the EU join CPTPP due to FOMO if UK and some others did? CPTPP might one day become the 'new WTO' given the current one is struggling?  

Obviously the future is not set... (ie I'm not making a prediction before one of the 'gotcha' types pretends I am)

well, the question of whether the EU would join CPTPP has a number of differences to my question, which is what happens if we try and leave CPTPP to rejoin EU, if the EU haven’t joined CPTPP.

inciuding the issue, that if the EU do join CPTPP, would that include freedom of movement? 

Yours is an interesting additional question though.

[Deleted]

c-a-r-f-r-e-w They'd be issues with anyone wanting to be 'full' members of what is currently the CPTPP and the current regime of full EU membership (or EEA). Some 'Stay Out' (of EU) folks might see that as one benefit for joining CPTPP. Some folks, more from the RejoinEU side, might mention what we gave up when we joined EEC (ie gen.pub might not consider it to be a big deal to leave CPTPP if we had to) or get themselves into all kinds of hypocrisy over sovereignty issues (eg demonstrate why CPTPP is not like the EU but that there are 'geo-political' reasons beyond purely trade to form various agreements and pool some sovereignty with various countries, eg Five Eyes, NATO, etc )

Since we don't know what the CPTPP will evolve into or who might join in the future then it is a 'hypothetical' to discuss the issues of leaving something we haven't yet even joined (eg we might have some 'tailored' access or if likes of US, India, etc join CPTPP then it will harder to leave). We also don't know what the EU will evolve into. Whilst they want 'ever closer union' (scenario 5 in the link) then the future is not set..

ec.europa.eu/commission/presscorner/detail/en/IP_17_385

Unlikely IMO but if the EU was to 'evolve' into a looser arrangement (scenario 2 but not in the way Juncker worded it) then any current conflict of being in CPTPP and EU might not exist in the future. The future is not set (before anyone pretends that it is)

[c-a-r-f-r-e-w]

Dec 6, 2021 20:50:25 GMT @tw said:

Since we don't know what the CPTPP will evolve into or who might join in the future then it is a 'hypothetical' to discuss the issues of leaving something we haven't yet even joined (eg we might have some 'tailored' access or if likes of US, India, etc join CPTPP then it will harder to leave).

yes, but given the matter under consideration was rejoining the EU, one has to consider things which might impact on that. Especially because Leavers might well seek to lock out rejoining the EU by joining something like CPTPP instead.

Your question of what the EU might involve into is an interesting one. Greater federalism is often under consideration, but I wonder if additionally the pressure on them to move left economically may continue, as those outside the EU profit from doing so.

[js]

FWIW my personal opinion is that the EU will move in the general direction of tighter integration with a slight left of centre “flavour”.

Mutualised debt is already underway and I don’t think Union tax harmonisation, including a Union wide element, is that far off. Substantial transfers from richer nations to poorer will feature, this being the LOC element.

A common defence policy and a common army is also in the works (yes Brexiteers, you were right) and I think will come to pass in the next decade.

The big hurdle to overcome is of course democratic consent for all this. The EU parliament could provide this but participation is woefully low. The other hurdle being undemocratic governments in some member states but paradoxically, that problem might provide the answer to the legitimacy issue depending on how it is solved.

[robert]

js

"Substantial transfers from richer nations to poorer will feature, this being the LOC element."

Good luck selling that to the Germans!

[alec]

js - "A common defence policy and a common army is also in the works.."

Very unlikely indeed, as long as NATO survives intact. As I've wearily pointed out on UKPR more times than I choose to recall, the EU treaties expressly forbid any military structures that duplicate or undermine NATO. A common EU army would fall foul of this, and although the treaties could be totally re written, it's very unliley indeed.

[alec]

c-a-r-f-r-e-w/@tw - the EU will never join CPTPP. The very mention of this is a daft idea to discuss, tbh.

CPTPP is based on a US regulatory approach, which is inconceivable ever to be acceptable within the EU.

Joining CPTPP also won't make a blind bit of difference if a future UK government want to rejoin the EU. Just give a years notice and then leave. The economic gains from rejoining the EU will always be greater than whatever we lose anyway, so that won't be too great a barrier.

[c-a-r-f-r-e-w]

Dec 12, 2021 16:47:16 GMT alec said:

c-a-r-f-r-e-w /@tw - the EU will never join CPTPP. The very mention of this is a daft idea to discuss, tbh.

thanks, but I already made clear I wasn’t on about that. It’s just another excuse for you to attach a label like “daft”.

[c-a-r-f-r-e-w]

Dec 12, 2021 16:47:16 GMT alec said:

Joining CPTPP also won't make a blind bit of difference if a future UK government want to rejoin the EU. Just give a years notice and then leave. The economic gains from rejoining the EU will always be greater than whatever we lose anyway, so that won't be too great a barrier.

oh, so you won’t be doing lots of posts about impact on exporters and supply chains and retaliatory measures? Henig won’t be fussed if we leave a trade zone, unless it’s the EU?

[alec]

c-a-r-f-r-e-w - "It’s just another excuse for you to attach a label like “daft”."

Apoligies if I offended, but it was aimed at @tw, who first raised the idea on this thread. I added you as you were party to the discussion. It is a daft idea, nonetheless.

"oh, so you won’t be doing lots of posts about impact on exporters and supply chains and retaliatory measures? Henig won’t be fussed if we leave a trade zone, unless it’s the EU?"

Really not sure what Henig has to do with this? Have you swallowed @tw's propaganda on all things Henig?
The point is that it's almost 99.9% certain that for the UK it will be a net benefit leaving CPTPP and joining the EU. There will be some losses from leaving one agreement, but these would be outweighed by gaining significantly from re-entering the other, much closer and more relevant one.

[c-a-r-f-r-e-w]

Dec 12, 2021 22:56:39 GMT alec said:

Really not sure what Henig has to do with this? Have you swallowed @tw 's propaganda on all things Henig?

The point is that it's almost 99.9% certain that for the UK it will be a net benefit leaving CPTPP and joining the EU. There will be some losses from leaving one agreement, but these would be outweighed by gaining significantly from re-entering the other, much closer and more relevant one.

I mentioned Henig because you have mentioned him before now, not because of TW. 

Even if eventually we might end up better off, it could be a lot of upheaval for lots of people, which seemed to bother about Brexit, AND annoy or substantially inconvenience the people in the trade zone we are leaving. Which also seemed to bother about Brexit.

And would the EU really be that keen on having us back if not only have we already joined the EU and left, we now turned our back on the CPTPP deal having got them to accept us?

then there is the question of whether the EU would have changed in the interim. The moves toward an EU army, and would we come under greater pressure to adopt the Euro to rejoin?

there is also the possibility we make more of CPTPP than you might think. We lost a big chunk of manufacturing under Thatch, and yet a few years later we made big gains in banking, which was rather unexpected. 

(and is it possible some may develop an attachment to being associated with CPTPP the way some have with the EU or indeed the Commonwealth etc).

[alec]

c-a-r-f-r-e-w - really not very sure why there would be that much upheaval if we left CPTPP, given that we have bilaterals with many of the CPTPP members anyway. As to whether the EU would want us back, well yes, that's a big question, but a different one. Purely on the economic gains, we'll get more from rejoining the EU than we lose by leaving the CPTPP. Whether that course becomes possible is a different discussion.

Yes, we did make gains in banking under Thatcher, largely because we became the European banking centre of choice. Another benefit from being in the EU.

We've already proved the case that EU membership adds significantly to GDP, and trade deals with distant countries, even large economies, add very little in comparison. That doesn't alter the fact that we might seek things other than GDP growth in our trading and political alignments, but it is a clearly established fact on the ground now, accepted even by the current Brexit government. I don't think there is much point any longer pretending that CPTPP membership can repair the economic damage leaving the EU has wrought. That doesn't mean leaving the EU was right or wrong, as there were always other considerations beyond the economic.

[c-a-r-f-r-e-w]

alec

We deregulated banking some time before joining the EU, and according to a recent commons paper “35% of financial services exports went to the EU and 31% of financial services imports came from the EU.”

So the EU is only about a third of it.

Further supposition in the idea we will get more from rejoining EU. We are good at services, and that is the way things are heading. More services, which can have greater reach. See banking as an example of that.

What is it you’ve been saying? According to the OBR, leaving the EU will cost us 4% GDP long term? Now compare with how much we gained from banking. Outside the EU.

[c-a-r-f-r-e-w]

Dec 12, 2021 23:17:12 GMT alec said:

“I don't think there is much point any longer pretending that CPTPP membership can repair the economic damage leaving the EU has wrought.”

I know you don’t. But I don’t think it’s impossible we can recover 4% of GDP. Look how fast we moved with vaccines as just a taste. And then banking. Not a given by any means, but a bit defeatist to just assume the worst.

[c-a-r-f-r-e-w]

alec

There is also another aspect. That we might need more freedom outside the EU to be better off overall.

An example of this, was our response to the banking crisis, which the EU eventually copied. The same to some extent with vaccines. And you can say that because the EU copy us, that therefore the gains are wiped out.

But if we hadn’t broke free in the first place, to model something different, then there wouldn’t have been the gains. Or they might have been much delayed.

Our moving economically leftwards, along with US, China etc., pulls the EU leftwards. There’s an argument we need to be freer of them to keep doing that. The overall gains of shifting the economics leftwards outweigh the hits.

[c-a-r-f-r-e-w]

@ Alec

Another aspect. When we left and the French were giving us a hard time, able to deploy the EU against us, recall you advised that this is just how it is, if you go up against a larger trade bloc.

But the thing is, aside from not really liking the idea we should give in to being bullied just because they are bigger, we are not so alone either. We have relationships outside the EU, as the French found out when we snaffled the submarine deal from under French noses. That’s just early days, and how much are those relationships worth, one wonders.

[alec]

c-a-r-f-r-e-w - didn't really see you as the type of poster wantng the UK to become ever more dependent on the finance sector....

But of curse, it is possible to recover that lost 4%, but this Brexiter government doesn't think so. And anyway, if it's possible to recover this 4%, we can surely argue that it's possible to be in the EU and then recover the lost whatever % from not being in CPTPP?

And of course, the data actually says that services trade are just as dependent on gravity as goods trade, as I've evidenced many times previoulsy.

[c-a-r-f-r-e-w]

Dec 13, 2021 7:55:39 GMT alec said:

c-a-r-f-r-e-w - didn't really see you as the type of poster wantng the UK to become ever more dependent on the finance sector....

Alec, I didn’t argue for dependence on the finance sector. In the past I have pointed out we are handy at exporting a range of services - legal, marketing, etc.

I used finance as an example because of how quickly we were able to snaffle a load rather unexpectedly. Not because I think that’s all we should do.

[c-a-r-f-r-e-w]

Dec 13, 2021 7:55:39 GMT alec said:

But of curse, it is possible to recover that lost 4%, but this Brexiter government doesn't think so. And anyway, if it's possible to recover this 4%, we can surely argue that it's possible to be in the EU and then recover the lost whatever % from not being in CPTPP?

And of course, the data actually says that services trade are just as dependent on gravity as goods trade, as I've evidenced many times previoulsy.

yes, it works both ways. But as I have pointed out, you still would have to take the hit people complained about of losing the existing trade, annoying the trade bloc, the Pacific version of Macron dissing our vaccines, the Pacific version of VDL threatening whatever. 

and probably needing referenda. And people forming attachments the way they have with the EU. And will the EU let us back after all that and under what terms?

There is also the issue of the trade deficit with the EU. Would we have one with CPTPP? Etc.

[alec]

c-a-r-f-r-e-w - I think what you are missing is that there is no comparison between EU and CPTPP membership. One is a political union, with the world's largest and deepest multi-state single market, with a profound impact on all areas of life of it's members, and one is a free trade deal which the vast majority of businesses and citizens won't notice.

Indeed, I think even just trying to use the two in comparison is being disingenuous. They aren't comparable, and in many ways, because of the way CPTPP was established, based on US regulation, in those areas where we do see impacts, the majority of UK citizens would be pleased to see the back of it, I suspect.

To be honest, this is part of the game that people like @tw and Liz Truss are playing, to try and pretend that CPTPP is some kind of alternative to the EU. It isn't, and won't ever be, unless we decide to replicate the EU political union with countries like Vietnam. If you think that's a likely proposition then fine - go ahead and discuss the possibilities with @tw, but I would politely sit that one out.

[c-a-r-f-r-e-w]

Dec 13, 2021 9:23:50 GMT alec said:

c-a-r-f-r-e-w - I think what you are missing is that there is no comparison between EU and CPTPP membership. One is a political union, with the world's largest and deepest multi-state single market, with a profound impact on all areas of life of it's members, and one is a free trade deal which the vast majority of businesses and citizens won't notice.

Indeed, I think even just trying to use the two in comparison is being disingenuous. They aren't comparable, and in many ways, because of the way CPTPP was established, based on US regulation, in those areas where we do see impacts, the majority of UK citizens would be pleased to see the back of it, I suspect.

To be honest, this is part of the game that people like @tw and Liz Truss are playing, to try and pretend that CPTPP is some kind of alternative to the EU. It isn't, and won't ever be, unless we decide to replicate the EU political union with countries like Vietnam. If you think that's a likely proposition then fine - go ahead and discuss the possibilities with @tw , but I would politely sit that one out.

You seem to have real trouble debating without messing with it needlessly.

I am not arguing that the EU and the CPTPP are equivalent. They do have some similarities, and pointing out they are not exactly the same, does not alter the fact that leaving the CPTPP would involve difficulties. 

I am just pointing out that there would be difficulties in Leaving the EU, then joining CPTPP, then leaving CPTPP, and then joining the EU again. Whatever you think about how comparable they are, doesn’t change that.

[alec]

c-a-r-f-r-e-w - Not sure I agree. leaving trade deals isn't very difficult, especially if it's linked to a much more profitable move in joining a better alternative. But I would agree that the hypothetical of rejoining the EU would be problematic.

[c-a-r-f-r-e-w]

Dec 13, 2021 10:23:31 GMT alec said:

c-a-r-f-r-e-w - Not sure I agree. leaving trade deals isn't very difficult, especially if it's linked to a much more profitable move in joining a better alternative. But I would agree that the hypothetical of rejoining the EU would be problematic.

Well, assuming that we might indeed end up better off economically in the EU again (and that we didn’t make more of CPTPP than expected, and no trade deficit etc.), one can agree that might be a compensatory factor, but whether it’s enough to outweigh all the concerns I listed is something else. Esp. if we are only talking about 4% of GDP (and we might get a bit of that back joining CPTPP).

[birdseye]

I wonder if any of the posters on this thread are actually involved in exporing from the UK. There seems to be a belief that trade deals allow trade and no deal prevents trade - something that is simply not true except with highly centralised third world countrioes like China.

I spent much of my working life exporting all over the world for a big british company. Sales on tens and hundreds of millions . Most of the markets we sold into did not have a trade deal with the UK. Indeed I remeber doing business in europe before we joined the EU. Sure trade deals can help ( they dont always) but they arent the be all and end all of international trade.

Nor is the paperwork a problem except maybe for the tiny business that has got used to just posting into the EU. Letters of credit are easily handled, shipping isnt an issue most of the time, and the rest of the paperwork depends on the terms on which you sell. FOB C&F etc

I voted to stay in the EU because I doubted and still do whether we have it in us to make the necessary changes to build a good future outside the EU care home. To pinch TW's strapline " The future is not set. There is no fate but what we make for ourselves"

[pete]

So Frosty resigns - rat leaving sinking ship comes to mind.

[pete]

birdseye, so this has improved? www.theguardian.com/business/2021/feb/11/half-of-uk-exporters-to-eu-are-having-brexit-difficulties-survey-finds

[alec]

birdseye - "I wonder if any of the posters on this thread are actually involved in exporing from the UK."

Not so much exports, although I am managing one project currently where we need to export some biological material samples for processing and testing in the EU. We've pretty much abandoned the idea now because it is an absolute nightmare, and this puts at risk a major project we had hoped to raise funding for in 2022.

I also import foreign made capital equipment on an infrequent but fairly regular basis. The Brexit induced inflation has been a killer, and trying to work out how to handle service contracts has been difficult.

Yes, the paperwork is a killer problem for many of us, but agreed, you can trade without a trade deal. What I predicted for Brexit though, and what has come to pass, is that the UK economy gained massively from single market membership because it allowed millions more small and micro businesses to access one of the world's largest markets. This has now gone, and all those SME's are suffering as a consequence.

[Deleted]

A few 'theories' from CON Home on Truss getting Frosty's job lumped in with hers:

Johnson hands Truss the poisoned fruit of the Northern Ireland Protocol

www.conservativehome.com/thetorydiary/2021/12/johnson-hands-truss-the-poisoned-fruit-of-the-northern-ireland-protocol.html

She's an opportunist and very ambitious. Backed Remain when it was 'popular' with the CON management of the time and then became a 'born again' Br-Leaver when that became the way to climb the greasy pole. 

Frosty's resignation letter puts him in the CRG-RUK camp of opinion[1] and I'll repost the cabinet league table that related more to his old job. He was 2nd to Truss in the 'popularity' stakes so if Truss wants to become CON leader one day she's not going to be able to 'go soft' but I hope this is a chance to 'reset' UK-EU relationships post Frosty (and chuck DUP under the bus perhaps, tie off the loose ends and finally-fully 'move on' to EU just being another part of the World with whom we have a lot of shared interest on many issues from geo-politics to climate change)

www.conservativehome.com/thetorydiary/2021/11/our-cabinet-league-table-johnson-is-back-in-negative-ratings.html

[1] It was also a 'warning shot' that a lot of CON MPs backed Boris in the last Covid vote but that he should expect a far larger rebellion next time, possibly with many more 'payroll' resignations and potentially even a leadership challenge (although hopefully not IMO as I'd like Boris kicked out for 'other' reasons - see previous comments on other threads and note the polling on lockdown, etc).