Brexit and related Trade Deal issues

[Mr Poppy]

An example of a biased view. I expect most of UKPR2a would accept the Torygraph is biased and whilst the specific info the article mentions is factually correct then they have omitted inflation impact and how UK has become somewhat of an 'intermediary' for some energy products (eg we import a lot of nat.gas from non-EU, some of which we regasify or turn into electricity and then (net) sell to EU). 

British businesses remain optimistic about selling abroad
New trade agreements, opportunities in new countries and support from the Department for International Trade signals a bright future

www.telegraph.co.uk/business/exporting-from-uk/key-statistics/

I only post the above for those who might consider the 'Remain'/ABCON press does not cherry pick or select specific methodology for their 'analysis' and 'opinion'. Bias is everywhere and it doesn't mean the analysis is worthless, just that you need to appreciate that if you 'torture the data enough, it will confess to anything' 

[Mr Poppy]

who'd have thunked it?

City jobs boom defies talk of Brexit exodus

www.standard.co.uk/business/city-jobs-boom-brexit-exodus-b1058141.html

and note the 'catalyst for change' component: "The Government must take action to solidify the UK’s competitive advantage and inject investment into both London and the rest of the UK by increasing trade deals, simplifying tax and investing in technology innovation"

Britishvolt is now in better hands : Britishvolt: UK battery start-up set to be bought by Australian firm
www.bbc.co.uk/news/business-64535346

and some e-Minis (owned by BMW) might well be set to be 'coming home' as we use our Brexit state aid freedom to bung them £75million to 'rethink':
BMW and government 'in talks' over Cowley Mini plant
www.oxfordmail.co.uk/news/23299684.bmw-government-in-talks-cowley-mini-plant/

Still a long way from the 'sunlit uplands' but the one step back that Brexit did course was a/ not as bad 'some commentators and politicians predicted' but also b/ finally starting to show some benefits (and happy to say they are minimal at the moment and we could have seen a lot more by now if CON HMG had realised Brexit was a 'catalyst for change' years ago and fully embraced the opportunities and delivered on the pledge to 'Take Back Control')

[Mr Poppy]

As we near the 25th Anniversary of the Good Friday Agreement then, despite the recent 'trial balloon' exercise being shot down by both sides, I'm still cautiously optimistic that a deal will be done that will not only solve most of the 'interpretation' issues of the NIP but will also solve some of the unnecessary Non-Tariff Barrier (NTB) issues between GB and EU.

So possibly the only example of where HMG 'dither and delay' is a good thing is:

Ministers In No Rush To Pass Northern Ireland Protocol Bill As Talks With EU Near Climax

www.politicshome.com/news/article/no-rishi-sunak-government-urgency-to-pass-northern-ireland-protocol-bill

Assuming a 're-interpretation' of the NIP occurs then most of the NIP Bill becomes pointless - and if EC-EU don't agree then, but only then, we pass the legislation. Starmer whipped LAB to approve Boris's deal in Jan'20 and has stated he'll back Rishi over 'reinterpreting' the NIP. So let's tie of the loose end in NI and be able to move on with the new 'entente' with a big show of multilateral support into Easter'23 (which I'm sure Biden will be quite keen to pretend he has played a part in as well). 

DUP and the other useful eejits (ERG) will be upset but parliament is sovereign so 'boo hoo' to SMogg and Paisley Jnr and thanks in advance to 'born again' Brexiteer Sir Keir Starmer and LAB MPs (who unlike the situation in Jan'20 will quite likely make the numerical difference by more than offsetting any ERG+DUP votes).

PS One for a different thread perhaps but I note RoI want to continue to use GB as a 'land bridge' to access the large market for electricity in both GB but beyond into  continental Europe and given they do 'often' have 'fairly different' weather patterns to GB/North Sea neighbours to the East, and are looking to build out from current 25MW to "7GW by 2030, 15GW to 20GW by 2040, and 37GW by 2050"* (map for where the locations are planned is on the Energy thread) then the new Greenlink** interconnector (0.5GW likely operational end of 2024) will need to be scaled up in due course and/or other interconnectors between GB and Eire are boosted or new routes are picked - and/or RoI will need to scale-up storage and consider exports for 'value-add' products like hydrogen (that they could ship from RoI ports straight to mainland Europe as ammonia and/or help with the development of a hydrogen pipeline infrastructure to link up Eire-GB-mainland Europe). Lots of options, some of which are "yes, and" but some of which crossover to "or" choices and depend a bit of what other countries (notably GB in RoI's case) do.   

* www.siliconrepublic.com/machines/ireland-offshore-wind-energy-nsec-2050
** www.greenlink.ie/summary

[Mr Poppy]

Optimistic view for now IMO but given Stormont elections have been postponed until Jan'24 and DUP/Donaldson are fighting against public opinion then maybe, but probably not at the first time of asking*, DUP consider their own tests - notably #4 and #7 (and note #5 wasn't the situation before Brexit as there were already some checks) 

Northern Ireland protocol: Deliberate wriggle room and semantic sleight of hand should enable DUP's seven tests to be met
www.irishnews.com/news/politicalnews/2023/02/16/news/deliberate_wriggle_room_and_semantic_sleight_of_hand_should_enable_the_dup_s_seven_tests_to_be_met-3066729/

* What is Rishi doing by bringing things to a head now, this far before Easter?
1/ Trying to show how difficult it is to make himself look good?
2/ Knowing DUP will say "no, no, no" so he can try to get some more 'horse trading' stuff from EC-EU? (before telling DUP to 'like it or lump it')

Starmer has Rishi's back and Westminster currently rules NI so "it will be, what it will be". DUP don't want to form a government in NI so they'll have to take whatever they get from the one DUP have chosen to run NI - I hope Rishi makes that crystal clear to them (but no harm in using DUP as useful eejits to tick down the clock a bit making it all look very difficult)

My 2c. A 'rewriting' 'additional writing' 'reimplementation' deal is already done but Rishi might want some minor other issues sorted knowing EC-EU want to move on with Entente (as does UK). Rishi is ticking down the clock to the Easter 'love-in' but wants some "look how hard I'm working for peace" press along the way (and able to keep the ERG quiet as he pretends to listens to the fuss the DUP are making). Starmer has already agreed to back Rishi (without seeing the details) and said "no, no, no" to "Rejoin, SM, CU" so for the few people still watching or interested then: enjoy the final episode of Brexit 

[Mr Poppy]

Still a few weeks until Easter so I'm certainly not getting my hopes up that Mon 27Feb will be the day but I certainly won't mind if Easter comes early, so the rewritten reimplemented NIP loose end of Brexit is tied off and we (GB+NI and EC+EU27) can finally all move on with a new Entente:

Hopes grow for Northern Ireland Brexit deal as Tory MPs ordered to attend Commons on Monday
www.standard.co.uk/news/politics/northern-ireland-brexit-deal-tory-mps-parliament-rishi-sunak-ni-protocol-b1062937.html

vdL, Biden, et al are going to desperate for the 'photo-op' but has Rishi secured enough concessions??? Will he lean on born again Br-Leaver Starmer for the votes he needs is DUP+ERG spit the dummy???

Stay tuned for the concluding episode of the final series of Brexit. All feels a bit like Game of Thrones where the action has already happened and it's going to end with a pretty boring luv-in 'photo-op', but you never know... (Boris as Jon Snow walking off into the distance would be a nice touch.. although it could be the whole of CON who walk of into the wilderness if they miss the GFA 25th anniversary opportunity and EC-EU decide might as well wait for Starmer)

[Mr Poppy]

Brexit now done for whole of UK and I'm not sure the CPTPP issue was 'stalled' until that was resolved but if Henig says it was then fair enough. Hopefully "CPTPP accession talks will now be completed this week or by early next." and I'll be getting the bunting out for that 🥳 🥳

PS I have to agree with him that Boris and Truss were twats but since we don't have access to parallel universes then we don't know if the "threat" of the Northern Ireland Protocol Bill was the reason that EC-EU27 gave ground and wanted to move on. I'm quite happy to give Boris (not Truss) some credit for upping the stakes in order to get this resolved. The 25th anniversary of the GFA happened to fall under Rishi's term so again, we don't know if that was the main reason that all sides wanted to 'move on' or not. I expect some will dwell in parallel universes or rewrite history but Brexit is now fully done - time to move on. CPTPP is next, then India, then...

[Mr Poppy]

gov.uk blurb on

www.gov.uk/government/publications/comprehensive-and-progressive-agreement-for-trans-pacific-partnershipcptpp-conclusion-of-negotiations/conclusion-of-negotiations-on-the-accession-of-the-united-kingdom-of-great-britain-and-northern-ireland-to-the-comprehensive-and-progressive-trans-pac

Noting that those countries are all a long way away (ie gravity effect for the lower value, highly perishable goods) then also note same protections as everyone else:

"The protections the UK has negotiated mean that increased access to the UK market for sensitive agricultural produce will be staged over a significant period of time, giving producers in sensitive sectors time to adjust to any new trade flows. We have also agreed permanent annual limits on the volume of the most sensitive agricultural goods that can be exported to the UK at a reduced, or zero, tariff from major producing countries"

The significance of joining CPTPP is far more than the minor GDP stuff that the neoliberal types will focus on but that will likely be lost on the neoliberal types. 

Well played Rishi+co. Well played 👏 👏

[Mr Poppy]

Henig does make me laugh.

The regulatory elements are indeed modest - CPTPP don't demand the lose of sovereignty that EC do in their "club". CAP-X piece is worth a read IMO as covers much of the non-GDP related points that I've mentioned in the past.

?

[Mr Poppy]

Blurb on the 'mini-deal' with US. Mostly a political statement but a few trade deal areas (and nothing on agri-food which should please those who used to panic about being force fed chlorine washed chicken)

www.gov.uk/government/publications/the-atlantic-declaration

[Mr Poppy]

Article explaining why EU are likely want to delay but 'Lexiteer' types will note that the €4.3bn cost to EU car manus is revenue for HMT and that UK has a whopping trade deficit in car sales with EU. However, the winner will be likes of China and hence I'm not opposed to a delay - PROVIDED is temporary (eg 3yrs) and used as an incentive to ramp up UK-UK supply chains, notably following on from the JLR bung and the deal Rishi has done with Biden.

So a delay is probable but let's ensure we use that extra time to do what we should have been doing in the last 3yrs (and Covid, followed by Ukraine is no excuse for 'dither and delay'). Similar for EU but the EU is not my polity. 

EU electric vehicles risk 4.3 bln euro post-Brexit tariff cost - auto body
www.reuters.com/business/autos-transportation/eu-electric-vehicles-risk-43-bln-euro-post-brexit-tariff-cost-auto-body-2023-06-19/

[Mr Poppy]

Reposting the below on the issue specific thread. I can't reply to the 'fake gotcha' as Mark has said he doesn't want me to engage with certain people (although it appears the 'rule' is not enforced the other way round). It beggars belief that people still don't get the difference between CPTPP and EU but if Mark says it is OK to do so then I'll waste 5mins of my time going over it all, yet again. 

However, IMO, it is worth posting the below comments as they are well... I'd best not say what they are 

Jul 22, 2023 10:11:20 GMT James E said:

Jul 22, 2023 8:27:47 GMT alec said:

When there are negatives to deal with CPTPP is 'just a trade deal'.

When it's time to hype it up a bit, CPTPP is a 'major, irreversible strategic and political re-alignment and close integration with a fast growing economic region'.

Have we got this?

Reality: no, CPTPP is not the same as the SM. It is much shallower in terms of political alignment, but also with much more limited gains. While the scope and depth of regulatory alignment is much less than the SM, CPTPP does infringe on UK sovereignty in some areas and will limit parliament's ability to pass laws, as the SM does. If that's a thing for you, you won't like the CPTPP. But I'm sure some will exhibit memory gaps in their efforts to promote CPTPP.

Exactly. The reality is that all Trade Deals involve regulatory agreement, which by definition is an infringement of 'sovereignty'.

After all the guff about sovereignty in relation to the single market, it seems that the infringement of Parliamentary sovereignty to any non-European country or trading group is now acceptable to the Sovereigntists. 

[Mr Poppy]

Aug 25, 2023 7:57:26 GMT lululemonmustdobetter said:

On the issue of re-joining, not sure if this has been posted before:

ukandeu.ac.uk/five-reasons-why-rejoining-the-eu-is-a-difficult-path-to-follow/

A fairly objective assessment summary of the key challenges with re-joining. We wont be in a particularly strong bargaining position, and currently I see no evidence at all of EU members wanting us back. What an effing mess we have got ourselves into.

Thank you for posting a source with what could be considered realistic steps and challenges that would need a 'plan' to address. I've moved the reply to the Issue Specific thread as it is a useful link that people can reread if they want to rather than simply state 'demographics' or whatever. 

From the link then first step: "It’s possible to conceive of a party pushing the rejoin agenda and winning an election..."

Possible for sure. Lots of stuff is possible. "No Fate but what we make.."

NB the 'we' does not apply to myself in this case. I'm happy to be out and don't want to Rejoin. So make that a 'they' in the above and as the rest of the article points out then Rejoin is not so simples as calling people who voted Leave 'liars' on a forum that hardly anyone reads. It would likely be complex, drawn out, with no vetoes, higher ££ contributions and no guarantee of success. Through that entire process then businesses would again be thrown into 'uncertainty' WRT to investment decisions (and I certainly accept the prolonged period of uncertainty from 2016-2020 caused some loss of GDP)

I won't waste my time asking you to clarify what 'offing mess' you think is specifically due to Brexit. I appreciate the issue of 'conflation'. You are of course entitled to your opinion. 

[lululemonmustdobetter]

Hi Mr Poppy - tbh I don't really want to get drawn deeply into a Brexit debate (they tend to descend into slagging matches) . I think we have both been clear where we stand.

My current view is that most likely we will at some stage re-join (for similar economic reasons to why we went in in the first place) - but it wont be easy, and there is no evidence atm to suggest, in short term at least. that there would be much enthusiasm in the EU for us to re-join. While Northern Eastern members would most likely support us - France is likely to oppose. And it will be a much weaker UK (possibly sans Scotland) trying to get back in.

[Mr Poppy]

Aug 25, 2023 9:05:15 GMT lululemonmustdobetter said:

Hi Mr Poppy - tbh I don't really want to get drawn deeply into a Brexit debate (they tend to descend into slagging matches) . I think we have both been clear where we stand.

My current view is that most likely we will at some stage re-join (for similar economic reasons to why we went in in the first place) - but it wont be easy, and there is no evidence atm to suggest, in short term at least. that there would be much enthusiasm in the EU for us to re-join. While Northern Eastern members would most likely support us - France is likely to oppose. And it will be a much weaker UK (possibly sans Scotland) trying to get back in.

We'll see. IMO it's not the 1970s anymore but I respect your entitled to your opinion. I wanted to repost your link on the Issue Specific thread as IMO it was/is/will be a very worthy read anytime the Rejoin issue comes back up. 

It covers most of the points I have made about the 'process' in the past. Thank you for posting the article. 

[Mr Poppy]

Another good read so I'll repost the link on the Issue Specific thread so folks can revisit well thought out opinion if they wish to:

Aug 25, 2023 9:45:48 GMT lululemonmustdobetter said:

On EU willingness to re-admit us, while from the beginning of the year, the following article is sobering -

www.theneweuropean.co.uk/would-europe-want-us-back-dave-keating/

edit johntel - see above for my response to your suggestion that I may be projecting my own views onto the EU.

I thought I'd been clear that I think we will eventually re-join - just that it is highly unlikely to occur within the next 10 years. Yes events could drive us and the EU back together quicker - but there is no evidence of that occurring yet and no signs of enthusiasm from the EU side. Your confidence/belief seems to be based more on something akin to faith or hope.

To add to the above then IIRC Remainers, Barmier, etc reckon EC-EU got an amazing deal from Boris where they still get tariff free access to UK but can 'poach' our financial services etc. Not quite how I see it (eg New York and Singapore were/are by far a bigger threat to London's status as Global Financial Centre and Leave.UK was critical to ensuring we continue to be globally competitive).

So other than getting a £15billion+ (ish) per year from UK then what is in it for EC-EU to have UK back? (Rhethorical question that is for those who want to Rejoin.EU to first of all get to the point of a major political party wanting to Rejoin, winning a GE with EURef2 in manifesto (or not), etc). If we never ask, we'll never know and I'm fine with 'Stay Out' so have no problem with us never even asking what the terms of Rejoin would be and who might say "non" to UK rejoining their club.

[Mr Poppy]

Reposting on the Issue Specific thread as it took me a whole 2mins to find the below long-term tracker via google (something they didn't have in 1970s) and another 2mins to write the post (+1min for the repost). Save myself 5mins needing to do that again if the issue of 'long-term trackers' comes back up.

Aug 26, 2023 9:21:57 GMT Mr Poppy said:

WRT to nice graphs on long-term trackers then I found the below. Note what happened to public opinion in years after when we voted 'Join.EEC'. If the 1975 ref (technically a 'Remain v Leave' ref) had been a few years later or we'd have a 'neverendum' batch of do-overs then we might have Vote.Leave.EEC or had decades of 'hokey cokey'. Just as well as those kind of refs are 'Once in a generation' IMO as it's the uncertainty that does the most economic damage - not to mention the divisiveness!

View Attachment

Had Major called a ref to Join.EU in early 1990s it would probably have won a large majority - but instead he allowed his own party to become split and divided on the issue. 

Then into EURef'16 then note the 'timing' was great for Vote.Leave: "In early 2015 the chances of ”Brexit”— Britain departing from the European Union—seemed remote. Today, largely because of Europe’s migration crisis and the interminable euro mess, the polls have narrowed."

www.economist.com/graphic-detail/2016/02/24/a-background-guide-to-brexit-from-the-european-union

The future?!?! Well, I don't have a crystal ball, but "There's no fate but what we make for ourselves" and so if the next generation want to Rejoin in say 30yrs then so be it. If any Rejoiner wants to make it happen any quicker then they should off their arse/keyboard and go through the process required (starting with having a Rejoin ref in a GE manifesto, winning the GE,...)

You might get lucky with the timing but IMO the most successful people make their own luck (or least pick their timings). 

[Mr Poppy]

Another useful link so I'll repost it on the Issue Specific thread for ease of future access/reading. IMO it will be the 'minimalist' approach but a few ducks to get under the bridge before Starmer takes over IMO. Non exhaustive list:

1/ A few more trade deals such as India
2/ Implementation of final customs stuff to ensure the relationship is genuinely 'reciprocal' rather than the current slight one-sided nature of access
3/ Some 'Entente' stuff if Macron's side project gets off the ground and EU ever get a functional 'irregular' immigration system going that UK might want to 'opt-in' on (which isn't within Rishi-CONs control but something to keep an eye on) 

Starmer might try to do something about #2 (eg 'align' on SPS stuff) but it will have consequences to open up a jar of worms and would unlikely make any +ve difference to future trade given supply chains would have adjusted already and any future HMG can reverse any changes in a future 5yr review. As per the loss of domestic industry in the 1970s when we Join.EEC then closer alignment to EU would, at the margin, be -ve for UK businesses (note I'm in favour of some mild protectionism when it relates to 'Securonomics' - a Reeves term!)

The risk for Starmer going near the review, rather than let it default to a non-event, is that he'll reopen the 'fanatic' views of Arch-Rejoiners and gift CON something to bash Starmer about (even though a lot of the 'bashing' might be exaggerated then that's how politics works). TBC but a case of letting sleeping dogs lie IMO (and I'm pretty sure some of the press will notch up the lies into the event   )

Aug 26, 2023 10:35:00 GMT colin said:

He will be conducting the first TCA Review-so needs to get his ducks in a row :-

ukandeu.ac.uk/what-might-the-review-of-the-trade-and-cooperation-agreement-actually-be-like/

[Deleted]

Aug 26, 2023 12:02:41 GMT Mr Poppy said:

Another useful link so I'll repost it on the Issue Specific thread for ease of future access/reading. IMO it will be the 'minimalist' approach but a few ducks to get under the bridge before Starmer takes over IMO. Non exhaustive list:

1/ A few more trade deals such as India
2/ Implementation of final customs stuff to ensure the relationship is genuinely 'reciprocal' rather than the current slight one-sided nature of access
3/ Some 'Entente' stuff if Macron's side project gets off the ground and EU ever get a functional 'irregular' immigration system going that UK might want to 'opt-in' on (which isn't within Rishi-CONs control but something to keep an eye on) 

Starmer might try to do something about #2 (eg 'align' on SPS stuff) but it will have consequences to open up a jar of worms and would unlikely make any +ve difference to future trade given supply chains would have adjusted already and any future HMG can reverse any changes in a future 5yr review. As per the loss of domestic industry in the 1970s when we Join.EEC then closer alignment to EU would, at the margin, be -ve for UK businesses (note I'm in favour of some mild protectionism when it relates to 'Securonomics' - a Reeves term!)

The risk for Starmer going near the review, rather than let it default to a non-event, is that he'll reopen the 'fanatic' views of Arch-Rejoiners and gift CON something to bash Starmer about (even though a lot of the 'bashing' might be exaggerated then that's how politics works). TBC but a case of letting sleeping dogs lie IMO (and I'm pretty sure some of the press will notch up the lies into the event   )

Aug 26, 2023 10:35:00 GMT colin said:

He will be conducting the first TCA Review-so needs to get his ducks in a row :-

ukandeu.ac.uk/what-might-the-review-of-the-trade-and-cooperation-agreement-actually-be-like/

Surely he has to address export problems. Many small traders have given up exporting to EU because of cost and paperwork. The Cultural sector_musicians , film makers etc have got huge impediments to business in EU.. It's an important Services sector for UK. Much else besides to try and improve.

What does "Make Brexit Work " mean if not removing some of these barriers ?

[Mr Poppy]

Aug 26, 2023 13:51:40 GMT colin said:

Aug 26, 2023 12:02:41 GMT Mr Poppy said:

Another useful link so I'll repost it on the Issue Specific thread for ease of future access/reading. IMO it will be the 'minimalist' approach but a few ducks to get under the bridge before Starmer takes over IMO. Non exhaustive list:

1/ A few more trade deals such as India
2/ Implementation of final customs stuff to ensure the relationship is genuinely 'reciprocal' rather than the current slight one-sided nature of access
3/ Some 'Entente' stuff if Macron's side project gets off the ground and EU ever get a functional 'irregular' immigration system going that UK might want to 'opt-in' on (which isn't within Rishi-CONs control but something to keep an eye on) 

Starmer might try to do something about #2 (eg 'align' on SPS stuff) but it will have consequences to open up a jar of worms and would unlikely make any +ve difference to future trade given supply chains would have adjusted already and any future HMG can reverse any changes in a future 5yr review. As per the loss of domestic industry in the 1970s when we Join.EEC then closer alignment to EU would, at the margin, be -ve for UK businesses (note I'm in favour of some mild protectionism when it relates to 'Securonomics' - a Reeves term!)

The risk for Starmer going near the review, rather than let it default to a non-event, is that he'll reopen the 'fanatic' views of Arch-Rejoiners and gift CON something to bash Starmer about (even though a lot of the 'bashing' might be exaggerated then that's how politics works). TBC but a case of letting sleeping dogs lie IMO (and I'm pretty sure some of the press will notch up the lies into the event   )

Surely he has to address export problems. Many small traders have given up exporting to EU because of cost and paperwork. The Cultural sector_musicians , film makers etc have got huge impediments to business in EU.. It's an important Services sector for UK. Much else besides to try and improve.

What does "Make Brexit Work " mean if not removing some of these barriers ?

and many small businesses have adjusted to UK-UK sales (eg the cheese sector if folks want to go through that again) and looking forward to improved access to faster growing markets. As jib posted on the main thread (and as per ONS info) then the volume of trade between UK and EU hasn't changed much - even after adjusting for inflation and the 'volatile' items such as Energy. I appreciate the Guardian finds a few anecdotes about some businesses that have found change difficult (eg M&S with Percy Pigs and the cheese chap who ended up doing very well out of Brexit)

The current arrangements are slightly skewed to give EU better access to UK due to the continued delay of final implementation from UK side (see my #2) and Starmer might decide to align UK to EC rules (as covered). Hence why Rishi needs to deal with that before GE'24.

Possibly some minor other issues in my non-exhaustive list (eg musicians visas etc) that would be mutually beneficial and Starmer can claim the credit for that if he gets that done. 

You'd need to ask Starmer to be more explicit on "Make Brexit Works" means. He could mean using the 'freedoms' of Brexit for more 'securonomics' stuff (ie the Lexiteer case) rather than anything that would put UK back under the control of Brussels.

TBC of course. If Starmer wants to reopen the can of worms then that is his call. EC-EU are probably fairly happy with a 'minimalist' review as a/ they think they have a great deal already, b/ they probably don't want to reopen the can of worms either (eg likes of Norway will be watching and wondering why they pay €billions/yr to be in EEA when UK has a 'Free' trade deal).

[Deleted]

Aug 26, 2023 21:17:30 GMT Mr Poppy said:

Aug 26, 2023 13:51:40 GMT colin said:

Surely he has to address export problems. Many small traders have given up exporting to EU because of cost and paperwork. The Cultural sector_musicians , film makers etc have got huge impediments to business in EU.. It's an important Services sector for UK. Much else besides to try and improve.

What does "Make Brexit Work " mean if not removing some of these barriers ?

and many small businesses have adjusted to UK-UK sales (eg the cheese sector if folks want to go through that again) and looking forward to improved access to faster growing markets. As jib posted on the main thread (and as per ONS info) then the volume of trade between UK and EU hasn't changed much - even after adjusting for inflation and the 'volatile' items such as Energy. I appreciate the Guardian finds a few anecdotes about some businesses that have found change difficult (eg M&S with Percy Pigs and the cheese chap who ended up doing very well out of Brexit)

The current arrangements are slightly skewed to give EU better access to UK due to the continued delay of final implementation from UK side (see my #2) and Starmer might decide to align UK to EC rules (as covered). Hence why Rishi needs to deal with that before GE'24.

Possibly some minor other issues in my non-exhaustive list (eg musicians visas etc) that would be mutually beneficial and Starmer can claim the credit for that if he gets that done. 

You'd need to ask Starmer to be more explicit on "Make Brexit Works" means. He could mean using the 'freedoms' of Brexit for more 'securonomics' stuff (ie the Lexiteer case) rather than anything that would put UK back under the control of Brussels.

TBC of course. If Starmer wants to reopen the can of worms then that is his call. EC-EU are probably fairly happy with a 'minimalist' review as a/ they think they have a great deal already, b/ they probably don't want to reopen the can of worms either (eg likes of Norway will be watching and wondering why they pay €billions/yr to be in EEA when UK has a 'Free' trade deal).

I really do think there are significant barriers amounting to serious loss of export revenue, across a number of sectors. I dont they should be dismissed. 

Whether the vaguely drafted TCA can facilitate adjustments and compromises I'm not sure. And even if goodwill can make it do so I'm not sure the will is there on their side.
Whether Starmer has any interest or intent to address this problem will be a marker of his quality for me.

[Mr Poppy]

Aug 27, 2023 7:17:36 GMT colin said:

Aug 26, 2023 21:17:30 GMT Mr Poppy said:

and many small businesses have adjusted to UK-UK sales (eg the cheese sector if folks want to go through that again) and looking forward to improved access to faster growing markets. As jib posted on the main thread (and as per ONS info) then the volume of trade between UK and EU hasn't changed much - even after adjusting for inflation and the 'volatile' items such as Energy...

I really do think there are significant barriers amounting to serious loss of export revenue, across a number of sectors. I dont they should be dismissed. 

Whether the vaguely drafted TCA can facilitate adjustments and compromises I'm not sure. And even if goodwill can make it do so I'm not sure the will is there on their side.
Whether Starmer has any interest or intent to address this problem will be a marker of his quality for me.

By all means post some data. I'm not saying there is totally frictionless trade (and there wasn't when we we're in EU either) - I wanted some increased friction (protectionsim) for UK businesses against EU imports (ie the Lexiteer case). Non-Tariff-Barriers have increased but are currently slightly skewed to give EU easier access to UK than vice versa.

We can get technical and cover the issues of 'mutual recognition' v 'aiignment' on stuff like SPS if you like - I did mention that was one area that Starmer might look at. I'd just like the arrangement to be 'reciprocal' with the uncertainty of 'when' removed. Whilst I accept some delay on the final elements is due to the paranoia about inflation then I hope that is resolved soon. Supply chains have likely adjusted 99% of the way already and the ongoing issue is allowing EU exporters easier access to UK than vice versa. The one-sided arrangement reduces the incentive for private investment in Britain.

I note in Reeves's article in the Torygraph*: "Instead, she says, she will do "whatever it takes" to attract private investment to Britain". One example of that would be to ensure UK increases domestic supply of stuff like car batteries, provides some bungs to private companies, enters new trade deals with rapidly growing countries around the World for high-value goods/services (eg UK built luxury EVs). Agri-food is a bit more complex but I would hope the Ukraine War shows the need to consider 'securonomics' on all essential sectors (Energy, food, even stuff like steel/chemicals/microchips/etc). 

As I've always said then Brexit is a catalyst for change. If we don't start making car batteries in UK then UK car industry will go from the slow death we had in the EU to a rapid death. If we do use Brexit as the catalyst for change (and I'm cautiously optimistic Reeves will continue from the painfully slow path of Rishi-CON) then UK can have a decent size car industry and increase domestic-domestic sales and sales to rapidly growing economies (eg India). At some point we might have a 'tit-4-tat' sector specific trade war with EU and guess which sector I'd like UK to hit (the same one US would hit if they got into a 'tit-4-tar' trade war with EU - a war UK could now 'sit out' and benefit from by selling to both sides). 

So I'm not sure what Starmer-Reeves will do WRT "Make Brexit Work" and the TCA review. If LAB get some free corporate tickets to play Wentworth and invite me along then I can offer then some tips. I'd take corporate hospitality tickets and watch the Pros play if Starmer/Reeves aren't golfers themselves - it's a pretty nice day out 

* www.telegraph.co.uk/politics/2023/08/26/no-wealth-taxes-labour-rachel-reeves/

[Mr Poppy]

Anything I post that is relevant to UK-India trade deal will likely be seen as biased so I'll start with Henig - who is certainly not biased in support of CON HMG or life beyond the EU

Well yes. We're not looking to sell chai to India or cheap, low-end cars, etc. The Ricardian view of trade is based on 'Comparative Advantage' and there are significant costs to shifting large, low value, or 'commodity' type goods long distances (ie 'gravity' is relevant to trade in many goods)

On services then a lot of UK businesses (eg JLR) offshore some tech stuff* to India already - you don't need a trade deal to do that. It is areas such as financial services (eg wealth management, insurance), legal services, etc where lower NTBs will increase UK access to the rapidly growing Indian market. We might sell more luxury goods (eg high-end cars, whisky, Burberry clothing, etc) as well and folks find goods easier to discuss so that gets some focus. We're not going to be importing any significant quantities of energy, food, or similar from India (or vice versa) so it has no impact on 'securonomics' and the need to 'Build/grow/generate it in Britain' to create British jobs for British workers. I'm not opposed to buying some low-end stuff from India instead of China (and whilst an FTA is just an FTA then the 'West' should want to keep India from falling into China's geo-political sphere - or at least try to pull them back). On work visas then I'm happy to compromise there but I do appreciate that is a tricky one to 'sell' to CON MPs and folks who might vote CON in GE'24. It will likely only be a 'thin' (phase1) deal but IMO it is better to make small steps than wait forever. 

Folks can put relevant search terms in google and read the gov.uk blurb or the view from the Groan or Torygraph. If anyone has some detailed analysis that isn't obviously biased then please post.

* Also some production. In the not too distant future then car plants will become even more automated with even less jobs in the 'manufacturing' part. It is in the design areas, software, etc that the skilled jobs exist. In 'brands' then some 'snob' type value of wanting something not made in India/China will mean UK can still make a lot of cars in UK but a bit like where the computer that settles share trades 'lives' then where the robots that build cars 'live' isn't as big a deal as who advices on the share investments/manages the money or who designs the robots and the writes the software (or at least manages who writes the code) on increasingly more complex cars of the present/future. 

[Deleted]

Aug 27, 2023 9:27:37 GMT Mr Poppy said:

Aug 27, 2023 7:17:36 GMT colin said:

I really do think there are significant barriers amounting to serious loss of export revenue, across a number of sectors. I dont they should be dismissed. 

Whether the vaguely drafted TCA can facilitate adjustments and compromises I'm not sure. And even if goodwill can make it do so I'm not sure the will is there on their side.
Whether Starmer has any interest or intent to address this problem will be a marker of his quality for me.

By all means post some data. I'm not saying there is totally frictionless trade (and there wasn't when we we're in EU either) - I wanted some increased friction (protectionsim) for UK businesses against EU imports (ie the Lexiteer case). Non-Tariff-Barriers have increased but are currently slightly skewed to give EU easier access to UK than vice versa.

We can get technical and cover the issues of 'mutual recognition' v 'aiignment' on stuff like SPS if you like - I did mention that was one area that Starmer might look at. I'd just like the arrangement to be 'reciprocal' with the uncertainty of 'when' removed. Whilst I accept some delay on the final elements is due to the paranoia about inflation then I hope that is resolved soon. Supply chains have likely adjusted 99% of the way already and the ongoing issue is allowing EU exporters easier access to UK than vice versa. The one-sided arrangement reduces the incentive for private investment in Britain.

I note in Reeves's article in the Torygraph*: "Instead, she says, she will do "whatever it takes" to attract private investment to Britain". One example of that would be to ensure UK increases domestic supply of stuff like car batteries, provides some bungs to private companies, enters new trade deals with rapidly growing countries around the World for high-value goods/services (eg UK built luxury EVs). Agri-food is a bit more complex but I would hope the Ukraine War shows the need to consider 'securonomics' on all essential sectors (Energy, food, even stuff like steel/chemicals/microchips/etc). 

As I've always said then Brexit is a catalyst for change. If we don't start making car batteries in UK then UK car industry will go from the slow death we had in the EU to a rapid death. If we do use Brexit as the catalyst for change (and I'm cautiously optimistic Reeves will continue from the painfully slow path of Rishi-CON) then UK can have a decent size car industry and increase domestic-domestic sales and sales to rapidly growing economies (eg India). At some point we might have a 'tit-4-tat' sector specific trade war with EU and guess which sector I'd like UK to hit (the same one US would hit if they got into a 'tit-4-tar' trade war with EU - a war UK could now 'sit out' and benefit from by selling to both sides). 

So I'm not sure what Starmer-Reeves will do WRT "Make Brexit Work" and the TCA review. If LAB get some free corporate tickets to play Wentworth and invite me along then I can offer then some tips. I'd take corporate hospitality tickets and watch the Pros play if Starmer/Reeves aren't golfers themselves - it's a pretty nice day out 

* www.telegraph.co.uk/politics/2023/08/26/no-wealth-taxes-labour-rachel-reeves/

Restriction of the breadth of activity is as good a way of summing it up I guess :-
www.aston.ac.uk/latest-news/brexit-changes-caused-229-slump-uk-eu-exports-q1-2022-research

The reasons seem pretty clear:-

www.theneweuropean.co.uk/suna-erdem-a-third-of-uk-exporters-to-the-eu-really-have-given-up-over-brexit/

www.keybusinessconsultants.co.uk/accountants/business-tax/brexit-what-issues-do-importers-and-exporters-face

www.thetimes.co.uk/article/uk-music-industry-touring-live-elton-john-brexit-j8lh535q8

[Mr Poppy]

Aug 27, 2023 10:13:06 GMT colin said:

Aug 27, 2023 9:27:37 GMT Mr Poppy said:

By all means post some data. I'm not saying there is totally frictionless trade (and there wasn't when we we're in EU either) - I wanted some increased friction (protectionsim) for UK businesses against EU imports (ie the Lexiteer case). Non-Tariff-Barriers have increased but are currently slightly skewed to give EU easier access to UK than vice versa.

We can get technical and cover the issues of 'mutual recognition' v 'aiignment' on stuff like SPS if you like - I did mention that was one area that Starmer might look at. I'd just like the arrangement to be 'reciprocal' with the uncertainty of 'when' removed. Whilst I accept some delay on the final elements is due to the paranoia about inflation then I hope that is resolved soon. Supply chains have likely adjusted 99% of the way already and the ongoing issue is allowing EU exporters easier access to UK than vice versa. The one-sided arrangement reduces the incentive for private investment in Britain.

I note in Reeves's article in the Torygraph*: "Instead, she says, she will do "whatever it takes" to attract private investment to Britain". One example of that would be to ensure UK increases domestic supply of stuff like car batteries, provides some bungs to private companies, enters new trade deals with rapidly growing countries around the World for high-value goods/services (eg UK built luxury EVs). Agri-food is a bit more complex but I would hope the Ukraine War shows the need to consider 'securonomics' on all essential sectors (Energy, food, even stuff like steel/chemicals/microchips/etc). 

As I've always said then Brexit is a catalyst for change. If we don't start making car batteries in UK then UK car industry will go from the slow death we had in the EU to a rapid death. If we do use Brexit as the catalyst for change (and I'm cautiously optimistic Reeves will continue from the painfully slow path of Rishi-CON) then UK can have a decent size car industry and increase domestic-domestic sales and sales to rapidly growing economies (eg India). At some point we might have a 'tit-4-tat' sector specific trade war with EU and guess which sector I'd like UK to hit (the same one US would hit if they got into a 'tit-4-tar' trade war with EU - a war UK could now 'sit out' and benefit from by selling to both sides). 

So I'm not sure what Starmer-Reeves will do WRT "Make Brexit Work" and the TCA review. If LAB get some free corporate tickets to play Wentworth and invite me along then I can offer then some tips. I'd take corporate hospitality tickets and watch the Pros play if Starmer/Reeves aren't golfers themselves - it's a pretty nice day out 

* www.telegraph.co.uk/politics/2023/08/26/no-wealth-taxes-labour-rachel-reeves/

Restriction of the breadth of activity is as good a way of summing it up I guess :-
www.aston.ac.uk/latest-news/brexit-changes-caused-229-slump-uk-eu-exports-q1-2022-research

The reasons seem pretty clear:-

www.theneweuropean.co.uk/suna-erdem-a-third-of-uk-exporters-to-the-eu-really-have-given-up-over-brexit/

www.keybusinessconsultants.co.uk/accountants/business-tax/brexit-what-issues-do-importers-and-exporters-face

www.thetimes.co.uk/article/uk-music-industry-touring-live-elton-john-brexit-j8lh535q8

I've already given the link for ONS. Into Brexit then there was some 'stockpiling' so I respect some analysis will be 'cherry-picking' dates for comparison (eg Aston Uni piece).

Yes, a lot of small businesses have shifted focus away from low value/small exports to EU (a bit less so t'other way). With 'reciprocal' arrangements then we'd likely see even more UK-UK 'trade' and we can go back over the cheese sector (one that was supposed to be hit hard by Brexit) if you like. I'm very aware that we'll see press articles saying Ireland is replacing UK on sales of some food items to EU but we have a whopping great trade deficit with EU in sectors like food and, as a Green Lexiteer, then IMO we should prioritise domestic sales (and have some protection from other markets who 'dump' goods onto UK or use various other ways to undermine UK investment - such as burning a lot of dirty coal to make energy/steel which they export to UK)

Agree on the issue of music industry. That would seem mutually beneficial IMO so not something I'd give up much to achieve. The 'minimalist' formal review doesn't mean zero tweaks and some of those tweaks can be made in 'side deals' that are not part of the formal review. I appreciate EC-EU don't like 'side deals' but they do make 'side deals' and if you don't ask..

PS I also appreciate some people do want a 'stealth' approach to UK becoming a vassal state. Hence when people say 'UK exporters want...' then I will always say what about UK-UK trade and what EC-EU will ask for in return for granting UK 'easier' access to EU. Norway pay €billions into EU budget and have to accept Brussel's law/trade deals and FoM. UK had a woeful and widening trade deficit with EU* (and that hasn't changed by much yet if you make 'fair' comparisons using ONS data). So to avoid any confusion I'll restate: I want LESS trade between UK and EU.

* Why the UK trade deficit with the EU is (was) woeful and widening
www.theguardian.com/business/2018/apr/08/why-the-uk-trade-deficit-with-the-eu-is-woeful-and-widening

[Mr Poppy]

colin - As previously noted then trying to examine changes in UK trade in the last few years (into and post Brexit) is complicated due to other factors (eg the 'stockpiling' issue; Covid implications to supply chains; the spike in Energy prices due to Ukraine war)

OBR are sticking with the 4% long-term hit to GDP analysis (most of which was due to the uncertainty issues between 2016-2020, some of which are ongoing) and a 15% drop in UK-EU trade* (and as they use 'neoliberal' analysis they ignore the potential gains from more UK-UK 'trade' if we reduce the amount of EU->UK trade)

Anyway, in one snapshot analysis then they actually found..

"Goods. Despite tighter restrictions on the EU side of the border, UK goods imports from the EU have fallen by more than UK goods exports to the EU (Chart H, left panel). In the fourth quarter of 2021, goods imports from the EU were down 18 per cent on 2019 levels, double the 9 per cent fall in goods exports to the EU"

Those %s are on different numbers so the impact is more impressive (from a E/BNAT Lexiteer perspective). As they go on to say then some EU companies can't be bothered with the hassle to sell to UK anymore (even with the current one-sided arrangements). What pretty much all analysis will fail to measure is the increase in UK-UK 'trade' - because domestic-domestic is not 'trade'.

obr.uk/box/the-latest-evidence-on-the-impact-of-brexit-on-uk-trade/

I appreciate there is a short-term 'inflation' impact from increased friction and that it will take more than a bit of protectionism to see investment in UK increase - hence the 'catalyst' aspect.

Anyway, perhaps what OBR et al (other than a few Lexiteers like Larry Elliott and myself) are missing is that the kind of trade we had with EU was not 'good' for UK. I'll avoid a rant about 'neo-liberalism' but not everyone was a patsy in the EU. Some countries have ensured that the EU (internally and via trade deals) works very well for them (which is a more 'ordo-liberalism' perspective but folks disagree on the terms). The role of any elected govt is to prioritise it's own electorate as likes of Germany and France have done and continue to do (eg the issue of France blocking Spain's ability to export hydrogen to Germany). UK could have been 'proactive' inside the EU but we weren't. Outside the EU then I'm pretty disappointed about the slow pace and minimal change. Maybe Reeves will be better and "Make Brexit Work" becomes more than just a 3word slogan to convince Leave'16/CON'19 that LAB have moved on and will do more than CON have done to make use of Brexit 'freedoms'.

If we did ever Rejoin.EU then I would hope that we will have learned from our previous experience and put UK's interests first. We used to be a bit of a pain in the arse on some issues but we were the 'patsy' on trade (both within EU and by outsourcing our ability to make trade deals to Brussels where Franco-German interests are always 1st and 2nd in the queue - or 2nd and 1st)

* Lots of analysis on OBR's site. Does feel that they are often trying to justify a previously held view IMO but I admit to a bit of a bias against 'neoliberal' econometric models that consider any and all trade to be Wunderbar and have a blind spot for the ability to increase UK-UK 'trade' that comes with the Brexit Benefit of making it harder for EU companies to sell into UK from an EU manufacturing plant (some can and have moved some production to UK or bought out UK companies - at a fairly decent price in the few anecdotes I've been involved in   )
obr.uk/forecasts-in-depth/the-economy-forecast/brexit-analysis/#

PS Total tangent but I'm sure you read David Smith's piece in S.Times. Good to see more people considering that the BoE's mandate is perhaps not what it should be but IMO it is not the % that is the problem. 

PPS (and a bit more relevant). Then I'm guilty of perhaps being overly influenced by some of the defeatism from Starmer-LAB and not sure why Rishi-CON don't celebrate more 'facts'. I'm not claiming Brexit is the only reason but would note: "the UK once again ranked highest in Europe for new projects and continued to deliver more total jobs and jobs per project than Germany and France" (and the link shows it was a regional levelling up)
www.ey.com/en_uk/news/2023/06/foreign-direct-investment-uk-remains-second-in-europe-despite-a-fall-in-project-numbers#

Not exactly the kind of thing we are led to believe by the 'defeatism' view. 

[Mr Poppy]

Likely to be a bit of reversal in the significant changes in 'mode' that we saw in 2020 due to the Covid distortion of a lot of trade but the 'trend' and focus on rWorld/growing economies is likely to continue and could be sped up if UK continues to prioritise exports in what UK is good at exporting (eg UK-India trade in many sectors would be mostly Mode1 via the internet). As it was useful, factual info then the full link for those that want to read the ONS info is below. I hope they do an update soon

UK Trade in services by modes of supply: 2020
www.ons.gov.uk/businessindustryandtrade/internationaltrade/articles/modesofsupplyukexperimentalestimates/2020#

Historically then it should be obvious that despite EU not being as 'open' internally for trade in services as it was for trade in goods then it was still more open that UK-rWorld (largely due to EU's lack of prioritisation of services in trade deals). Hence some data becomes a 'tautology'. We did more trade in services with our near neighbours because we had better access to the markets of our near neighbours. Of course the same argument would infer that if we open up trade in services with rWorld then we'd do more trade in services with rWorld and of course higher NTBs with EU will likely mean a reduction in trade in services with EU (a small short-term price to pay for the long-term gain IMO). The only advantage 'near' v 'far' has in 'cyber' style services would relate to time zones (fairly easy to deal with given most of rWorld partially overlaps with UK business day and folks can/do work later in Asia and/or earlier in America to increase the overlap - as do some folks in UK of course). Language barrier is minimal given 'English' is the business language of the World and translation is far easier these days (although 'context' and specific legal 'language' still needs to be very specific and often in local language).  

Aug 26, 2023 15:09:19 GMT colin said:

Aug 26, 2023 14:22:31 GMT alec said:

Most trade in services follows trade in goods, so, servicing and maintenance contracts, legal services etc, tend to correlate heavily with physical trades.

Have you got a source reference for that please ?

ONS "UK Trade in services by modes of supply: 2020" ( most recent i can find) says :-

"Remote supply (Mode 1) made up 82.1% of total UK services exports in 2020 (excluding Mode 3)an increase from 65.2% in 2019. This primarily reflects the restrictions on global travel put in place at the start of the coronavirus (COVID-19) pandemic. Remote trade accounted for 81.6% of total exports to EU countries in 2020, an increase from 63% in 2019. For the rest of the world, remote trade accounted for 82.4% of total exports in 2020, increasing from 66.6% in 2019."...

 

[Mr Poppy]

I'll also repost the link for: "Indo French Agreement on Social Security enters into effect" as that is relevant to how Badenoch can unstick a sticky issue in the UK-Indian trade agreement - assuming we get something in return of course*

in.ambafrance.org/IMG/pdf_Indo_French_Agreement_on_social_security.pdf

*


Well not 100% happy at least, although they'll then go on to tell their home audience they are very happy and some folks will pick holes in any agreement (which is fair enough) whilst others make business decisions to adjust to the new opportunities - the smarter ones planning some of that in advance rather than experiencing a 'Percy Pig' incident 🤦‍♂️

[Mr Poppy]

So "not a rule taker" is today's LAB policy - let's see how long that lasts. As he points out LAB policy is CON HMG policy - just in case anyone thinks Starmer-LAB will be materially different in the relationship they want UK to have with EC-EU.

[Mr Poppy]

UK-Germany trade in cars is back in the news as Germany (aka 'sick man of Europe, again) looks to protect one of their key export markets by delaying the introduction of Rules of Origin (RoO) changes.

Background info:
Germany backs tariff delay on electric vehicle sales between UK and EU
www.theguardian.com/business/2023/sep/08/germany-backs-tariff-delay-on-electric-vehicle-sales-uk-and-eu-brexit

and info on the massive trade deficit that UK has in 'cars':

The top 5 goods exported from the UK to Germany in the four quarters to the end of Q1 2023 were:
... 5:  Cars (£2.2 billion or 6.3%)
(and some Road vehicles other cars that didn't make into top5)

The top 5 goods imported to the UK from Germany in the four quarters to the end of Q1 2023 were:
1. Cars (£17.0 billion or 23.9% of all UK goods imported from Germany)
..4. Road vehicles other than cars (intermediate) (£2.8 billion or 4.0%)

Approx £17.0 billion per year in cars and other road vehicles. Seeing that trade deficit drop (from both sides) would mean a lot more skilled jobs in UK and improvement in trade balance (helping the £). Most data doesn't show UK-UK (see SMMT data for that) and I doubt we would ever get to 'net zero' trade in cars with Germany, but if we made say +£5billion worth of new cars in UK for the domestic market (and German imports dropped to £12billion) then that would obviously create a lot of British jobs for British workers and turn the tide on exporting manufacturing jobs that occurred when we we're the 'patsy' in the EU.

assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1185634/germany-trade-and-investment-factsheet-2023-09-21.pdf

They need a deal on cars more than we do! I can appreciate the need for a 2-3yr delay on RoO changes as it will be China that benefit the most and due to the issue of inflation and CON HMG only recently starting to use Brexit freedoms to bung likes of JLR. However, bringing in those changes SHOULD mean we can reduce our 'woeful' trade deficit in cars PROVIDED we ensure we continue to 'crowd-in' investment into UK - using the freedoms of Brexit (ie State Aid/bungs) to do so.