Legally British subjects until January 1983, we must never forget our African and Caribbean friends from the Commonwealth who stepped up in Britain’s time of need. Those who came over in their vast numbers to help us fight the Nazis and those who boarded HMT Empire Windrush in 1948 to come and rebuild this country after the war.
From the British West Indies Regiment to the Royal West African Frontier Force, over half a million volunteers from both Africa and the West Indies joined the British Army and served in the RAF, fighting to defend “King and Empire” during Britain’s Darkest Hour. 10,000 Africans were killed, with 166 receiving medals for bravery. By the end of the war, 11 battalions from the Caribbean, comprising of 15,000 soldiers, had seen action.
Fast-forward the clock to 1948, and HMT Empire Windrush was heading from Australia to England, due to dock at Kingston, Jamaica, to pick up servicemen from leave. An advert had been placed in a Jamaican newspaper, offering cheap transport to those who wanted to come and work. It was from the British Government, inviting people to come and help rebuild the “mother country” a time when it was most in need.
Of the 800 that boarded that ship that day, some came in the hope of re-joining the forces. Others made the most of the opportunity just to take the trip to England. But many stayed and settled, as under the British Nationality Act of 1948, they were legally British citizens. They filled important labour shortages, sometimes almost solely so, from working in British Rail to the NHS. They formed new communities, had children and grandchildren – and like many of us in this country who have heritage from around the world, they added a chapter to the pages of the British story. They formed an integral part of the modern, diverse and tolerant nation that we are today. A country that so many of us are proud to call home.
From Ghana in 1957, to Antigua and Bermuda in 1981, the majority of Commonwealth countries in Africa and the West Indies fought for their independence from Britain over the years to follow. British Citizenship for those coming from the Commonwealth came to an end in 1962 and, as they were going out on their own, we were getting closer and closer to our European neighbours.
Although certain privileges have remained, such as the ability to vote in our elections, the more integrated that we have become with our European neighbours, we have drifted further and further apart from our Commonwealth friends. Brexit provides us the opportunity to change that – to develop those long-standing relationships once more.
When it comes to trade, the EU does have its own trade deals with both the Caribbean and several African countries, but they are less than perfect and not necessarily how we might choose to do things going forward. There is some degree of relief from EU tariffs for the poorest countries, but this does not apply to farm produce, where the trade is largely in the EU’s favour. This protectionist nature is often seasonal, for example higher tariffs are applied to oranges when EU crop is available and the price of sugar is guaranteed for Europe at three times the world average.
The Common Agricultural Policy, with the subsidies that it provides European land owners, makes it almost impossible for African farmers to be able to compete. Thousands of tonnes of subsidised food from large transnationals are able to be dumped into Africa at low prices, and tariffs applied the other way mean that German manufacturers can make double their profit on re-exporting raw goods from the continent. Nigerian President Muhammadu Buhari earlier last year refused to sign an EU-West African trade deal, in order to protect Nigeria’s economy, her industries and her small businesses. In Buhari’s own words, jobs needed protecting to keep her “youthful population busy”.
Now that we are going out on our own, we have the opportunity to move away from this model of protecting when it suits and charity when we wish. Should we so choose, we can trade freely and open up our markets. Fast growing economies like Nigeria will have the opportunity to be rewarded for their entrepreneurship, and places like Zimbabwe will be free to trade with us outside of the EU’s embargo.
In leaving the European Union, we can trade with countries on the African continent once and for all as equals. And in doing so, we are presented with an opportunity to re-balance the global stage.
Better trade relationships also mean that in the long term, we can move away from this old, somewhat colonial model of giving vast amounts of aid, simply for the sake of patting ourselves on the back and meeting an arbitrary target. We can be proud of the role that we play on the global stage in delivering aid when it is needed, such as the £427 million direct support package that Britain gave during the Ebola crisis of 2014, or the £15 million sent to the Caribbean after hurricane season. Nobody can doubt that spending this kind of money is the right and the noble thing to do. We will always be on hand where we can to assist countries in need.
This is vastly different, however, to perpetuating a culture where teenagers from the West now think that they are more qualified to build a school than a local, or working in an orphanage unqualified is a gap year ‘adventure’. The time surely has come to question this attitude that we have had for so long, to be honest in how this behaviour might skew our lens and mindset when we compare ourselves to certain cultures around the world.
We have an opportunity now to rethink our aid budget and how it can be put to better use. To find small and local organisations to fund, harness skills to pass on and move into a model of empowerment, instead of seeing ourselves as perpetual rescuers, hopefully re-balancing our relationships in the long term. The Ghanian President, Nana Akufo-Addo, elected in 2016, has had the consistent message of his vision for a “Ghana beyond aid”. He is committed to growth in the private sector, and said that “we have to take our own destiny into our own hands”. From Gambia to Zimbabwe, slow and steady progress for democracy is being made in Africa, and with it a new generation determined to take their nations forward to standing on their own two feet. Britain herself now has a unique opportunity to stand with them side by side, and do what we can along the way.
As Nelson Mandela said: “Education is the most powerful weapon which you can use to change the world”, and many can argue that it is the best tool a government can ever provide in order for its people to lift themselves out of poverty. Our membership of the European Union has brought us so many benefits in terms of science and research, data-sharing and forming collaborative working in our universities. Now we have the opportunity to use all of that and go further, opening up our world-leading higher education sector and forming new partnerships around the world. In Africa and the Caribbean, particularly, this is a key moment to use education for the greatest possible good.
From water sanitation to wildlife conservation, committing to working together through new collaborations and ways of doing things could transform so many lives, whilst solving crucial global challenges in the process. We can build on the outstanding work done by so many in the third sector, through the frameworks used during our years of EU membership, to think innovatively about how we can work together in the future. From exchange programmes to more formalised training, the possibility of opportunities that we can offer both those in Britain and abroad, to share their knowledge, have new experiences and make a real difference in the process, is endless.
For our universities at home, up until now, EU students have enjoyed the same tuition fees as home students, whilst those from outside pay almost triple. From visa applications to finding a home to rent, financial barriers hit non-EU international students the hardest. Upon graduation, they have to jump through the most hoops if they wish to stay here and work. The opportunity to devise a new system now lies in our hands, to attract the best and the brightest to study here; free to stay and form part of Britain’s story, or to head home with a life-long connection and skills and an education that they can really put to use.
Back to our African and Caribbean friends, who have helped us so much in days gone by: now is the perfect time to say thank you and time for Britain herself to renew her relationships with each nation, to tailor our immigration policies to ensure that we treat each nation as fairly as every other or to give special preferences to the Commonwealth, should we so wish. Whether that be in education or work, an opportunity arises now to show each nation how much they are valued to us.
Brexit gives us the opportunity to trade with them as equal partners, opening up the market for fair competition; the opportunity to rethink the way that we deliver aid – to not perpetuate patronising viewpoints, but to move towards real empowerment, trusting in each other’s ability to stand on our own two feet, never putting ourselves above or below each nation, but simply standing side by side during potentially turbulent times.
For our African and Caribbean friends, it’s time for us to remember the realities of our past, plan optimistically for our shared future and to become the equal partners in a post-Brexit world.
This article is an extract from Clean Break, Bright Future: Leaving the EU, Rejoining the World, published by the Freedom Association’s Better Off Out campaign
The post Brexit will allow us to rebuild relationships in Africa and the Caribbean on an equal footing appeared first on BrexitCentral.
The British people were told during the EU referendum that a vote to Leave would be a move towards isolationism, that the EU was Britain’s gateway to prosperity and that we should not turn our backs on the rest of the world. Given Britain’s proud history as a seafaring nation and commitment to global trade prior to the establishment of any European Community or Union, this argument fell on deaf ears.
In fact, it was joining the European Union that closed Britain off from the world in many respects and cut ties with allies around the world. With a renewed independence and freed from the shackles of one of the largest bureaucracies on Earth, Britain can embrace the wider world.
The Commonwealth of Nations
Advocates of closer ties with Commonwealth countries are often disregarded as nostalgic for the British Empire. Whilst it is true that the vast majority of member countries were former colonies or dominions of the Empire, the Commonwealth today is a modern and flexible gathering of 53 countries with significant cultural, diplomatic and historic bonds. This community of nations now represent a third of the world’s entire population, with some of the fastest-growing economies in the world.
Where the Commonwealth differs significantly from the European Union is that, despite the impression that having a monarch at the head of the organisation may give, there is nothing authoritarian about the Commonwealth. The Commonwealth lacks the rigid structures of the EU and instead is valued by members because membership invites – and does not force – closer ties.
Commonwealth countries are respected as autonomous; sovereign nations voluntarily agree to work together on various areas of policy. These policies are discussed at the annual Commonwealth Heads of Government Meeting (CHOGM), which have thus far focused on shared goals on climate change, human rights and the promotion of peace and democracy.
Britain’s membership of the EU has overshadowed its commitment to collaborating with Commonwealth nations. With such a strong emphasis placed on diplomatic relations with the European Union in recent decades, many young Britons are unaware of the UK’s leading role in the modern Commonwealth.
Trade with Australia, CANZUK and the Commonwealth
Before joining the European Economic Community in 1973, Britain enjoyed a close trading relationship with Commonwealth countries, as natural allies and partners. When the news reached Australia that Britain was turning its back on the Commonwealth in favour of the EEC, there was a strong backlash and sentiment of betrayal. In the decades since, both of our countries have changed. Britain has become eurocentric in its thinking and trade – and has allowed the European Union to take decisions on her behalf. Australia has turned to Asia, with over 66% of its exports going to the region. Given that so much has changed for both of our countries, can Brexit restore the friendship that once was? Can Britain now re-engage with Australia, and with the wider Commonwealth The answer, I hope, is yes.
The UK is right to prioritise trade negotiations with the EU at this early stage, but once that arrangement is settled, there will be a huge opportunity for Britain to pursue free trade agreements with countries with whom Brussels has failed to negotiate a deal. Trade negotiations don’t need to take as long as EU talks traditionally do, because most agreements don’t require the approval of 27 nation states. In fact, the US-Australia FTA, for example, was concluded in less than two years.
A free trade agreement with Australia isn’t just a possibility, but something that our governments are working towards. On a visit in London, former Foreign Minister Julie Bishop declared that both the British and Australian governments “stand ready to agree a free trade agreement as soon as circumstances allow.”
Other Commonwealth countries such as Canada and New Zealand have also expressed an interest in a Free Trade Agreement with the United Kingdom, and there have been proposals for a free trade area or zone between the United Kingdom, Australia, New Zealand and Canada. Unlike a customs union, a free trade area between CANZUK countries would remove trade barriers internally without binding the four nations into a collective external tariff or customs policy. Britain would still be allowed to negotiate its own trade deals with other countries, whilst improving trade relations with its closest allies.
Whilst negotiating deals with Australia, Canada and New Zealand would be the obvious starting point, because of the political goodwill shared between nations, there are also longer term opportunities for agreements to be made with other Commonwealth countries with fast-growing economies, such as India and Singapore. Although many of these countries are at a distance geographically, some researchers have noted a ‘Commonwealth Effect’, which is a phenomenon describing the uniquely strong trading relationship that exists between member countries. A report by the Royal Commonwealth Society concluded that:
“The value of trade is likely to be a third to a half more between Commonwealth member states compared to pairs of countries where one or both are not Commonwealth members. This effect can be seen even after controlling for a range of other factors that might also explain trade patterns.”
It’s important to point out that advocating a closer trading relationship with Commonwealth countries doesn’t imply that these trade agreements would act as a replacement for Britain’s important trading relationship with Europe. Britain can and should aim to continue a close trading relationship with the EU, whilst also seeking opportunities elsewhere. In the long term it must be considered that growth forecasts for EU economies are in many cases quite dire, whereas the majority of Commonwealth countries are set to see their GDP ranking rise.
It’s also crucial to recognise that these opportunities are only possible if Britain leaves the EU’s Customs Union. An ideal arrangement would be a Canada plus model, whereby the UK Government leaves the EU with a similar Free Trade Agreement to the Canada-EU FTA, but maintains Britain’s independence from the EU’s Single Market and Customs Union.
Uniting the Anglosphere to fight terrorism
It is often forgotten, and somewhat ignored by history lessons in Britain (which now prefer a more European centric version of events), that in two World Wars Commonwealth soldiers – including thousands from my home country of Australia – crossed the seas to come to Britain’s defence. The established peace in Europe rests on the shoulders of many of those soldiers, whose stories have been left out of the European Union’s propaganda about being the sole custodians of the peace in Europe.
The European Union, which was formed many years after this peace was secured, did have a role to play in establishing a good trading relationship between countries on the continent. But it was not a trading arrangement that defeated the Nazis. For a period of time Britain and her Commonwealth allies stood alone to face down Germany, with the help of the United States and Russia. When the threat of the Soviet Union seized the continent, it was the United States, Canada, and individual Western European nations that established the North Atlantic Treaty Organisation – not the European Union.
Those who attempt to position the EU as the sole defender of peace in Europe are disingenuous historical revisionists. In fact, there is an argument to be made that moves towards federalisation and the encouragement of mass immigration has fuelled divisions within European countries. There is a growing dissatisfaction and anger amongst citizens on the continent, and increasing civil unrest, in response to the EU’s handling of the migrant crisis and on the further centralisation of democratic powers. Far-right parties are gaining traction in countries such as Hungary, Germany, Sweden, Poland and Italy.
Mainstream political parties are losing the faith of voters because they are invariably pro-EU and refusing to address concerns about immigration. These mainstream politicians can’t advocate EU membership without a recognition that there is nothing a national government can do to change its immigration policy, which is fuelling the popularity of extreme far-right political parties. The EU parades as the saviour of Europe but contributed nothing to peace settlements or NATO, and is in fact fostering divisions and tensions in member countries by asserting dominance over national governments.
However, the greater concern to Britain is the establishment of a European Defence Force. Britain has signed up to several agreements with the EU which would obligate the UK to pool defence resources with EU countries after Brexit and, even if withdrawn from these agreements, it is still of great concern to the Anglosphere that the EU are persisting with a defence union that would duplicate, and essentially undermine, NATO.
It appears that in response to the United States urging European countries to meet their NATO spending requirements, the EU has decided instead to divert funds into a defence union excluding America. Britain must be resolved to separate itself from this vanity project, and encourage the EU to instead call on member countries to meet NATO spending requirements.
Of course, Britain’s closest and longest lasting security partnerships have been with Commonwealth and Anglosphere nations. The Five Eyes Alliance – one of the most comprehensive alliances of its kind – is an intelligence sharing network bringing together security agencies from the UK, US, Australia, New Zealand and Canada, who together represent over 40% of global defence spending.
This high level of trust and co-operation on intelligence matters is reliant on an incredibly close cultural bond and commitment to a set of shared values. At a speaking engagement in London on the future of the Five Eyes Alliance, Former Prime Minister of Australia John Howard said:
“It’s hard for me to think of five countries in the world that comfortably relate to each other, when it comes to fundamental democratic values… There is something about the intimacy of the relationship and it rests on the fact that when the chips are down, the Five Eyes participants trust each other on a political and cultural level. Beyond the level of trust that is found with other countries.”
Leaving the EU is an opportunity to strengthen this important partnership without interference from European partners. The former head of the CIA, General Michael Hayden, noted in 2016 that the EU often ‘gets in the way’ and, and the UK must be mindful that any commitment or obligation to collaborate on intelligence or with the European Defence Force could jeopardise the exclusive and restricted nature of the Five Eyes relationship.
When it comes to tackling extremism, the Commonwealth Heads of Government meetings have discussed further collaboration; the 2018 April CHOGM Communique encouraged member countries to “actively share expertise and best practice” in countering violent extremism, which is certainly a welcome start. But with Brexit bringing into focus Britain’s role as a global power and leading voice in the Commonwealth, these annual meetings could be an opportunity to set clearer and more ambitious goals for defence and security co-operation.
The vote to leave the EU wasn’t about turning inwards, but a decision taken about who is in charge of Britain’s destiny. Outside the EU’s Customs Union, it will be up to elected British politicians to decide which countries to pursue free trade agreements with, and provided the UK is not tied to the new European Defence Force, it will be Britain – not the European Union – that decides which allies to collaborate with on matters of defence and security. These opportunities are within reach, if only those who believe in an empowered Commonwealth and an empowered Anglosphere continue to advocate them.
This article is an extract from Clean Break, Bright Future: Leaving the EU, Rejoining the World, published by the Freedom Association’s Better Off Out campaign
The post Brexit presents an opportunity to reinvigorate relations with the Anglosphere and the Commonwealth appeared first on BrexitCentral.
In light of last night’s developments, as Parliament starts to consider what would make for an executable framework for much of the UK’s economic future, one thing has become clear: the Withdrawal Agreement must be changed – renegotiated.
For that to happen, the enduring interests of each party, the UK and the EU, must be recalled so that a politically viable outcome can be reached. For its part, the UK seeks a deal on services which account for 80 per cent of its economy. By contrast the EU seeks a deal on goods, to protect its valuable surplus. Both parties want the benefits of as frictionless trade as possible. Beyond trade, wider collaboration is sought in certain areas, such as security.
But for the UK, the current draft Withdrawal Agreement falls short of what is needed on two key counts: sovereignty and trade.
The Agreement gives away sovereignty, leaving the UK with no say over any of its laws during a transitional period, and then no say at all over chunks of laws thereafter. Restoring constitutional sovereignty was a referendum decision and must be respected if any agreement is to take off.
For trade, the draft Withdrawal Agreement cannot work if EU interests for a quasi-customs union are prioritised along with elements of the Single Market for goods, but only warm words are offered for the UK’s interests in services, including financial services.
In the Political Declaration, which was a simultaneous but non-binding declaration of intent, the parties stated their wishes for a wide-ranging trade deal, involving mutual recognition on services and enhanced equivalence for the financial sector. Yet the current proposal to put services ‘on hold’ to be negotiated in a transitional period, would bring uncertainty and dangers for all. During that time the UK regulators would be without the powers often needed to change rules dynamically to protect taxpayers. Though such a transition period may be workable for goods, it cannot be for services. So though we see good intentions for services trade, the execution falls short.
In fact, a viable overall arrangement in skeletal form can be agreed even now without the need for the alternative of a managed no-deal. Perhaps inevitably, this reflects the EU’s typically last minute way.
How could this be achieved? The concept of Enhanced Equivalence is one which I set out in detailed legislative form in July 2017. This would provide financial businesses with what they need, enabling them to operate across Europe under one set of regulations and subject to one supervisor, replicating the status quo. It would avoid the costs of setting up duplicative regimes which are charged back to consumers, to the detriment of businesses and savings within the EU27.
Under Enhanced Equivalence, when the parties’ laws achieve equivalent outcomes, businesses can provide services in the other market under their home jurisdiction’s regulations and supervision. We already have executable text, providing for exactly that and achieving procedural certainty for the granting and withdrawal of equivalence in each financial sector. Temporary recognitions could tide the parties over for four months to finalise any details. A similar approach would work for mutual recognition in other services. The reality is that each party would be starting with not just equivalent laws, but they often move even now in a similar direction.
In practice, the EU’s artificial mantra that no trade deal can be negotiated until the UK is a third country can be circumvented for services by a mutual recognition agreement rather than a free trade agreement.
There are good reasons for the EU to agree. The eurozone needs the UK to continue to treat its member state government bonds as sovereign for regulatory purposes, ignoring a proper application of international regulatory standards and avoiding crippling costs. To assist, the UK needs full, dynamic control over all other protective regulatory levers. Enhanced Equivalence achieves just that. Also, the UK cannot be expected to agree to every other aspect of the deal so favourable to the EU unless the EU reciprocates.
The practicalities are close to the intended agreed position anyway. In financial services, the EU is already making unilateral declarations of equivalence across key areas such as cleared derivatives, allowing a continuation of current arrangements even on a hard Brexit. More declarations are likely, preserving the competitiveness of continental EU financial institutions and the ability of EU citizens to obtain access to cheap finance.
As the negotiations inch their way towards a system that can work, the UK’s whole economy must be brought to the fore. That means services must be covered and constitutional essentials recognised. Otherwise, nobody ends up with what they want.
The post A Withdrawal Deal is achievable in principle and executable in practice before Brexit appeared first on BrexitCentral.
Below are the remarks delivered by Shanker Singham at an event in Westminster alongside David Davis, Dominic Raab, Arlene Foster and Lord Lilley
On 24th September, we gave you Plan A Plus, a genuine alternative to the Prime Minister’s plan as laid out in the Chequers meeting. On 12th December we gave you the alternative Withdrawal Agreement with an Irish backstop that actually works and commands the support of the DUP among others.
Today, on the day of this momentous vote, we are bringing the two together, showing how negotiating dynamics can be used to achieve results and previewing our next major launch which will be the entire UK-EU Free Trade Agreement, built on what the EU has already agreed in other fora, which we are already 350 pages or so of the way through.
A vote against the Withdrawal Agreement is a vote for UK opportunities after Brexit. Voting for the Withdrawal Agreement takes Britain’s opportunities off the table.
While there is a vigorous debate about end states, there is little discussion of the process of getting from here to there – even though that process will determine the potential end state. We have tended to talk about the end states like they are options on a menu, and not discussed in detail how negotiating dynamics actually work in real time. Negotiating pathways are critical to understand how we get the best Brexit outcome. So are the do’s and don’ts of trade negotiating.
There are now three negotiating pathways covering what is likely to happen in various scenarios. In the first pathway, if the Prime Minister’s deal is accepted by the House of Commons, then the logical progression is that we will be unable to align our allies by negotiating trade deals with them. We will have to pay all the money now, limiting our leverage, we will be threatened by the backstop arrangement whenever the EU feels like it and so we will lose every negotiating point as and when they come up, and this will guarantee a bad deal.
If, on the other hand, the deal is voted down we have selected two possible negotiating pathways. In the first, we recommend that the UK puts A Better Deal on the table, announces what it will do in the event of an exit without a Withdrawal Agreement, including potentially opening up agricultural import quotas to all comers, and allow the compression of the timetable to work for once in the UK’s favour bringing the EU back to the table. We know that both sides want a comprehensive FTA with regulatory cooperation, customs facilitation and Irish border facilitations. It would be an act of monumental incompetence to fail to agree even the most basic FTA.
But we do not control the EU, so in the third pathway, we look at what happens if with the best will in the world, we fail to conclude prior to 29th March. We will exit on WTO terms, which as noted in Lord Lilley and Brendan Chilton’s excellent paper, 30 Truths About Leaving On WTO Terms, does not hold the terrors our Government has suggested. But we will be able to do all the other things that constitute the do’s of good negotiating. We will be able to align our allies. We will be able to negotiate other deals. We will not have to pay the full amount of the payment. We will use our applied rates to bring the EU back to the table, and I daresay that we will get an FTA from them quite quickly after exit. In other words, what people call “no deal” is not a stable state and will not last very long because both the UK and the EU will want a deal. There are many things we can do unilaterally to lessen the disruption until this occurs.
In these two scenarios, we must be prepared to use the weakness of the EU against it. It is reactive. So we must be pro-active, and seize the pen by putting negotiating text on the table. They are a global outlier in terms of their approach to regulation and liberalisation – and becoming more so – so we must draw our allies onto our side. When we make offers, they should align with those made by the US, as well as other allies like Japan, Australia, New Zealand, Singapore and others, and help to solve the major global trade problems we all face, such as China distortions.
They are major agriculture exporters to the UK – fully 70% of our beef comes from the Republic of Ireland, so we must leverage that. To protect our consumers and prevent food price inflation, we will have to at least open up Tariff Rate Quotas to all comers. This will force EU agricultural exports to compete head on with industrial strength production in Argentina, Brazil and other places and they will quickly lose market share in our market. The EU has a $29bn surplus for agriculture with us and have benefited from the cosy customs arrangement with our captive market.
Once they start losing market share, this will put pressure on them to come to the table. We can ensure minimum disruption to our farmers by applying WTO compliant direct payments for environmental remediation and stewardship, but these will not need to be for very long. The EU tends not to be creative and follow others – astonishingly the EU-Japan agreement is the first that has regulatory cooperation whereas for the US and others that chapter has been the norm for over a decade. So we must be creative and offer solutions.
The hour is upon us, but it is not too late. We need a change in our approach and a change in our team. We must have a holistic to approach to our trade policy that includes the EU relationship and the relationship with the wider world.
Seeking an extension of Article 50 now would be a catastrophic mistake as it would remove the compression needed to get a deal. It would communicate weakness and vulnerability. Telling the EU that we will keep coming back to the House of Commons with minor variants of their bad deal would also be a catastrophic mistake as it would again take the pressure off them.
We must not lose sight of the fact that there are tremendous opportunities before us. But catastrophic failure also beckons in the shape of this Withdrawal Agreement. Let us choose the former by voting the deal down, and immediately seize the opportunities that are ours for the taking.
The post MPs should vote down Theresa May’s Withdrawal Agreement and seize the opportunities of A Better Deal appeared first on BrexitCentral.
The below is an extract from Economists for Free Trade’s new report, No Deal is the Best Deal for Britain
It has become clear that Remainers have a big problem: they can find little positive to say for either why we should remain in the EU or for Theresa May’s Withdrawal Agreement. Their total argument has been and continues to be based on ‘fear’. Nowhere has this been more apparent than their invectives about No Deal – i.e. a World Trade Deal where the UK leaves the EU on 29th March without a trade deal under WTO rules.
The Government, together with Establishment figures and the commentariat, have fallen over themselves warning of short-term perils – first, chaos at our ports and second, claims that somehow a host of existing rules and regulations will become inoperative as of 11.01 pm on 29th March. Day-to-day life, as we know it, will cease to exist with regard to travel, business contracts, citizens’ rights and even the ability of performing artists to perform.
This alleged short-term disruption is deemed to be so apocalyptic that it is considered not even worth thinking about if there might be a long-term upside. Thus, the cacophony about the short-term has shouted down any fundamental thought about the inherent benefits of No Deal.
What is the reality?
Disruption in the Ports: What Disruption?
It is claimed that on 30th March UK ports will have seized up due to delays required to process customs declarations. Furthermore, since UK goods will no longer comply with EU standards, onerous inspections will be required – adding to the bedlam.
These claims should not be taken seriously. They do not reflect what actually takes place at ports today and they fail to take into account the legal and competitive environment within which ports operate.
1. Post-Brexit port procedures will not be materially different from those of today and the required changes mainly are in hand. The image of customs officials with clipboards crawling over trucks and stamping approvals on customs forms has not been valid for decades. Today, all customs declarations are computerised and prepared at the facility of the importer/exporter or their designated customs broker. Shipments are pre-cleared by computers talking to computers so that trucks rolling into the ferry terminal essentially are waived through automatically. This is how the many UK ports that deal with shipments from non-EU countries under WTO rules operate today.
To accommodate Brexit, HMRC has adopted a ‘belt and braces’ strategy by which the existing Customs Handling of Import and Export (CHIEF) system has been doubled in capacity to accommodate the increased volume of EU-UK customs declarations. In addition, a new EU-wide customs declaration system (CDS) – which was already in the development pipeline before the referendum – will be run in parallel. HMRC has repeatedly stated before select committees and in its own publications that CHIEF and CDS are already operational and will be ready to deal with EU shipments on 29th March.
A potential issue is that some businesses may not have their software interfaces with CHIEF/CDS operational by March. The service industry of customs brokers should have the necessary systems and expertise to support such businesses (mainly small) that may not have the required internal capability. However, it may be the case that not all customs brokers will be sufficiently up to speed and have the required capacity to fill the gap completely.
To alleviate this risk, there are simplifications to existing procedures that HMRC can authorise and HMRC has already announced that for the 60 per cent of EU trade that is imports, it will ‘prioritise flow over compliance’ – i.e. it will wave vehicles through to avoid queues, even if customs declarations have not been properly completed. As shipments are pre-approved, normally, if a trader has not completed the required declarations, the shipment will not be authorised. The shipment may be delayed but it will not contribute to congestion at the port.
2. Inspection regimes will not change. What about the much ballyhooed inspections that Remainers claim will create delays and miles of parked trucks along the M20? In fact, as HMRC has repeatedly emphasised, there is no reason for much to change. Under WTO rules, inspections are intelligence-led, based on computerised risk assessments and generally have little to do with customs issues. Security, drugs and illegal migration are much greater concerns.
Since there is no reason why these risk factors should change after Brexit, HMRC intends to maintain the existing inspection regime post-Brexit, which currently results in only about 1 per cent of (even non-EU) goods being inspected.
The claim that new onerous inspections at the border will be required after Brexit because UK goods will somehow no longer meet EU standards is hypothetical fancy. After over 40 years with identical product standards and regulations – and contrary to what many doomsayers may wish the public to believe – UK goods will not suddenly become hazardous to the health and safety of EU consumers the day after Brexit. Last week the President of the Boulogne and Calais Ports made clear that the Port of Calais plans no additional inspections relative to what they do today.
So, it is clear there is no practical reason why disruption should suddenly occur in the ports following Brexit.
3. EU recalcitration and discrimination would be illegal. The WTO Trade Facilitation Agreement, the WTO Technical Barriers to Trade Agreement and the Kyoto Convention of the World Customs Organisation commit the EU and all 187 WTO countries to making border processing activities as streamlined as possible. These measures are enforced by WTO Panels and the WTO Appellate Body that are backed by the international legal system.
The WTO Trade Facilitation Agreement mandates a seamless (computerised, pre-cleared) border enabling trade to continue passing through ports with minimal checks, pre-cleared by computer, with all relevant information pre-entered at low cost straight from the loading logs. The EU’s own Customs Code requires customs declarations to be done online and allows these to be entered with as little as one hour’s notice.
There is no WTO requirement for border checks and, where physical inspections are necessary, the Agreements require that they be intelligence-led and not be more trade-restrictive than necessary – i.e. they should conform to the current regime applying to both the EU and the UK where only about 1 per cent of goods arriving from non-EU countries are physically inspected. The WTO’s Agreement on the Application of Sanitary and Phytosanitary (SPS) measures does allow for border checks to ensure the safety of imported food but stipulates that such checks should not be used as a surreptitious means of inhibiting cross-border trade or “arbitrarily or unjustifiably discriminate between WTO members where identical or similar conditions prevail… SPS measures shall not be applied in a manner that would constitute a disguised restriction on international trade”.
With regard to standards, WTO rules on non-discrimination on standards mandate that, once the EU or any other WTO member has announced their proposed domestic standards, these must apply without exception to all foreign exporters.
So, if the EU were to ignore the practical, common-sense reasons for continuing to process EU-UK trade as efficiently as they do today, they would be acting illegally and could face lawsuits. The WTO dispute process is far from toothless, enjoying an excellent compliance record among its many hundred rulings over decades of practice.
4. Competition will keep the EU in check. Even if common business sense fails and the EU is tempted to flout international law, competitive pressures will rein them in. Dover-Calais is the major concern in this regard because it has roll on/roll-off (RoRo) facilities accounting for about 30 per cent of EU-UK trade – and Calais is in the only EU country where political leaders have signalled possible uncooperative post-Brexit actions.
Fortunately, numerous other freight ferry routes – with RoRo capabilities – already exist between several UK and continental ports. Dutch and Belgian port operators have already made it clear that if an EU port – say Calais – were to attempt to complicate border procedures artificially to inhibit UK exports, ports such as Rotterdam, Zeebrugge and Antwerp (amongst others) would be keen to grab the business and quickly fill the gap.
It is estimated that sufficient capacity exists to handle 30 to 40 percent of Dover-Calais freight shipments. The Dutch sensibly have built up their customs facilities, hiring more inspectors and setting aside land at their ports for the limited additional inspections that may be required, primarily for agricultural products.
In practice, it is very unlikely to come to this, as pragmatic local French authorities and port operators have offered assurances for continued cooperation on numerous occasions, aware that they will lose out to their European neighbours if they attempt to frustrate Brexit maliciously. The latest such assurance was on the Today programme on 9th January when the President of the Boulogne and Calais Ports confounded his BBC interviewer by making clear that Calais will be ready for UK business by 29th March and he explained that they plan no additional inspections relative to what they do today and detailed a long list of specific investments and actions they have taken over the past year to avoid any possible congestion or delay.
Brexit will not lead to a blockade in the English Channel, as strangely many wish us to believe.
Life will continue after 29th March
Much of the drummed-up anxiety regarding “crashing out” of the EU has begun to abate as the UK Government, along with its EU counterparts, has ramped up preparations for a No Deal Brexit in light of the impasse in EU-UK negotiations. Despite the tireless efforts of the media and the status quo Establishment which still insist that the UK will collapse into recession and experience a severe supply shock and civil unrest, it is slowly emerging that trading with the EU under WTO terms will be manageable, albeit with some possible ‘bumps in the road’ in the early days.
Thus, work seems to be at last under way, and it should now be stepped up with enthusiasm – remembering that many problems can be lubricated by a £39 billion saving.
For example, an increasing number of the crucial non-WTO “side deals” that commentators gleefully warned were essential to avoid the devastation of post-EU isolation are now materialising. Aeroplane landing rights, drivers’ licences, euro clearing and derivative contract issues are now settled.
Many EU citizens living in the UK are already following the straightforward process for obtaining permanent residency. In recent days, the Dutch, German, Italian and Belgian governments have already announced post-Brexit citizens’ rights for UK nationals living in their countries. And the Spanish are establishing procedures for healthcare to be delivered to UK citizens when in Spain. We also have promises from the EU and Ireland that there will be no hard border, as one isn’t really needed and never was.
Furthermore, Lord Lilley and Brendan Chilton’s excellent report, 30 Truths about Leaving on WTO Terms, has detailed a long list of agreements that have emerged in recent weeks between the UK, the EU and EU member states affecting day-to-day life. These cover a wide range of areas including, for example, ‘micro’ trade agreements, medicines, clean water, air travel, aircraft manufacturing, haulage, agricultural and animal products, mobile telephones, auto type approvals and VAT rules. And – never fear – even British opera singers, musicians and other performers will still be able to tour the EU.
It is becoming ever more evident that civil servants – in spite of their public comments being constrained by ministers – have been working quietly behind the scenes to ensure minimal post-Brexit disruption.
Thus, it appears the closer we get to the alleged ‘cliff edge’, the more countries on both sides of the Channel are facing up to their responsibilities. The ‘cliff’ now appears to be turning into a grassy slope.
Remember the Millennium Bug? Perhaps we have been here before.
The post The supposed ‘cliff edge’ of leaving the EU on WTO terms is another Millennium Bug appeared first on BrexitCentral.
At the end of last year, the Global Competitiveness Report ranked the UK as the eighth most competitive country in the world, praising its ‘very well-functioning markets, a top innovation ecosystem and vibrant business dynamism’.
However, the top-performing countries in the 2018 study by the World Economic Forum were dominated by non-EU countries including the United States, Singapore, Switzerland and Japan.
Despite this, politicians, businesses and the media appear to cling on to our ties to Europe. Leaving without a deal with Europe has been brandished as the height of irresponsibility, falling off the cliff edge and other such fearsome but conjectural words. Yet in reality 98 per cent of world trade occurs within the World Trade Organisation (WTO). The UK is a member of this global platform.
For my companies the horizons have always stretched far beyond continental Europe. Corrocoat, for instance, exports 68% of its anti-corrosion products globally and less than 10% of that goes to Europe, whilst Glassflake exports over 80% of its output with only circa 7% to Europe. We have operations in some of the most exciting, fastest-growing places in the world such as South Africa, Indonesia, Thailand, Malaysia, China and the United States.
The EU has stifled growth with its rules and regulations, reduced appetite for competition and hindered the sort of innovation and entrepreneurship that has made both our sister companies Corrocoat and Glassflake success stories.
Companies do need to prepare for a WTO exit, but the myths around a no-deal scenario and fear of the unknown have wrongly led us to believe that vital sectors in our economy are at risk.
In actual fact, departing on WTO terms will act as a catalyst for businesses to become more competitive and more innovative. Gerard Lyons, a leading British economist, has argued that stifling EU regulation has made UK exporters less competitive and less productive in global markets whilst also doing little to increase wages. Only once the UK is open to trade with the world can we reverse this trend.
The IMF estimates that 90 per cent of global growth in the next 10 to 15 years is likely to come from outside the EU. If the UK goes back to bulldog Britain instead of the pussycat Britain it has become under the EU, it can be part of this global success story. We should embrace such an opportunity instead of listening to the hearsay and doom-mongering.
The post Leaving the EU on WTO terms will make our businesses more competitive and innovative appeared first on BrexitCentral.
The below is an extract from Economists for Free Trade’s new report, No Deal is the Best Deal for Britain
Leaving the European Union without a Withdrawal Agreement under Article 50 is not a step into a legal vacuum. Still less does it amount to going over any kind of “cliff edge”.
What happens is that our international trade with the European Union will become subject to the same legal regime which currently governs the majority of our export trade to the rest of the world. That is trade under the World Trade Organisation rules-based system.
The three key elements of the WTO system that will affect our post-Brexit trade with the EU are its rules on tariffs, its rules on non-tariff regulatory barriers to trade and its rules on the facilitation of customs procedures.
The WTO’s rules on tariffs allow members to charge tariffs on imported goods up to certain limits, but, subject to limited exceptions, any tariffs must be imposed equally on goods from all countries – the so-called Most Favoured Nation (MFN) principle. The EU will therefore impose its standard external tariffs on goods imported from the UK, unless and until a future free trade agreement or interim agreement leading to an FTA is agreed.
This is not a big deal. These tariffs will come to £5-6 billion per year, less than half the UK’s current net budget contribution to the EU.
The UK will be obliged to charge the same level of tariffs on imports from the EU as it does on imports from the rest of the world. But, contrary to much ill-informed comment, the UK is not required to charge the same tariffs on its imports as it currently charges under the EU-mandated Common External Tariff. We will be free to charge lower tariffs, or zero tariffs, as we judge appropriate, so lowering the cost of basics in household budgets.
The WTO agreement on Technical Barriers to Trade will require the EU to recognise UK-based goods certification procedures and allow entry to the EU Single Market for UK goods which comply with UK rules until such time as they are changed to become different from the EU’s rules. At the same time, the Withdrawal Act mandates that the UK shall continue to recognise EU rules and EU certifications on goods unless and until this is changed by secondary legislation. This means for example that medicines made in the EU will continue to be recognised as conforming to the UK’s import rules and arguments that there will be shortages are pure mythology.
The WTO Trade Facilitation Agreement will apply to smooth customs procedures between the UK and the EU. It mandates for example electronic pre-clearance of imported goods, avoiding the need for physical inspections at the point of entry except in exceptional circumstances.
In an ideal world, we would progress forward to a full Free Trade Agreement with the EU. But there is no need to rush it – our trade relations with the EU will operate just fine under WTO rules for as long as necessary.
The post Leaving the EU with No Deal is not a step into a legal vacuum appeared first on BrexitCentral.
If you believed the headlines in the last six months, you would be forgiven for thinking that you would be unable to book a city break in Europe or visit loved ones abroad after the UK leaves the European Union. Apparently, planes will not be allowed to fly or – even worse – land on 30th March if we leave without a Withdrawal Agreement.
We are told this is because we are led to believe the UK does not have the right deals in place, because pilot licences will no longer be valid, British aviation companies will have relocated to Paris and we can’t import enough Mars bars to feed the crew on long-haul flights.
As Chief Executive Officer of a global aviation technology company, I can reassure you that this is not the reality. The UK’s world class aviation industry is not going to sit on its hands after Brexit, let down millions of our customers or allow businesses to go bust.
Many of my colleagues and clients have made the same point. Willie Walsh and Johan Lundgren, the chief executives of British Airways and EasyJet respectively, have both dismissed the prospect of there being no flights between the UK and Europe. Meanwhile the Civil Aviation Authority has branded a Sky News report which suggested as many as 35,000 pilots would need to renew their licences as ‘misleading’, reminding us that the UK is a signatory to the International Civil Aviation Organisation Chicago Convention.
And yet, these stories portray Britain as afraid to stand on its own two feet, begging our European counterparts to allow our planes to land and to renew our licences.
Contrary to these myths, such headlines actually reflect the defeatism that underpins the draft Withdrawal Agreement, certainly not the optimism and resilience of our country and industry.
Since forming Vistair almost two decades ago, we have striven to become a global, innovative business that meets the challenges and opportunities offered by the UK and the world.
I believe that by disengaging ourselves from the restraints and bureaucracy of the EU, these opportunities will multiply. For that to happen, we need a real Brexit: one in which we can strike Free Trade Agreements with the biggest and fastest-growing countries (hint: they are not in Europe), we can compete in our rightful place in the global economy and we can channel the innovation that is shown every year at the Farnborough Air Show.
Rather than letting ourselves be backed into a corner, afraid of the opportunities that a global trading platform like the World Trade Organisation presents, the UK needs to once again become the independent, entrepreneurial trading nation that 17.4 million people voted to see.
Fear of leaving the EU without a deal, and of trading with the EU thenceforth under WTO terms, has been created primarily by the much-cited series of predictions of severe adverse economic consequences by HM Treasury. It is therefore of some importance to decide whether their predictions are credible.
One set of their pre-referendum predictions referred to the adverse consequences within two years of a vote to Leave the EU rather than leaving itself. Since we have now lived through the period they covered, we now know that apart from one minor point, the fall in the value of sterling, they were all false. Every other prediction they made, on GDP, (which was predicted to fall rapidly by between 3.6% and 6.0%) on employment, house prices, wages, inflation, FDI and public finances, was wrong, often by risibly large margins, and always in the same direction. This suggests they were deliberately manipulated to give a politically helpful result for the then Government-backed Remain campaign. They naturally raise questions about the Treasury’s other three sets of predictions about the long-term consequences of Brexit itself.
These cannot be tested by reality until 2030 or beyond, but since they rely on a number of highly improbable assumptions and estimates, they are no less contrived than their short-term predictions, and no more credible. These assumptions and estimates cannot all be examined here, but we can identify the most improbable and incredible, the ones that have contributed most to the Treasury’s characterisation of trading under WTO terms as the worst possible post-Brexit option.
Their first set of long-term predictions was published in April 2016, and depended to a large extent on the assumption that future UK intra-EU trade in goods would increase at the same rate as that of all other members. This was followed by the estimate that by 2030, if it remained a member then, UK trade in goods would have grown by 115%. If, by contrast, the UK left to trade under WTO rules, it would not enjoy any of that 115% growth, and primarily for this reason, its GDP in 2030 would be 7.5% smaller than it would have been if it had remained a member.
This seems to have prompted Remain supporters to describe the transition to a no-deal exit as a cliff edge, a car crash, or a leap in the dark, and trading under WTO rules as chaos, catastrophe and Armageddon. Since most of world trade, and much of UK trade, is routinely conducted under these self-same WTO rules, the aptness of these metaphors is questionable, but what matters here are the assumptions on which the Treasury prediction was based.
Questions about it might first have been raised with the Treasury itself since a rare piece of in-house classified research conducted in 2005 had shown, like more recent studies, that the rate of growth of the UK’s intra-EU trade during the Single Market has differed greatly from that of other members, most especially from those in Eastern Europe. This HMT research also showed that over the 31 years from 1973 to 2004 it had grown by only 16%, while later IMF/DOTS figures showed that over the 22 years from 1993 to 2015 UK exports to the EU 14 had grown by 25%. To then ‘estimate’, as the Treasury authors do, that over a mere 15 years to 2030 UK-EU trade in goods would suddenly increase by 115%, may be reasonably called absurd, or even a deliberate manipulation to produce a highly misleading prediction. A recent re-examination of the same evidence, using the same gravity approach as the Treasury, but referring to the UK alone, estimated the likely increase of trade in goods with the EU by 2030 to be ‘in the range 20-25%’.
The Treasury was a contributor to the second set of predictions, the EU Exit Analysis Cross Whitehall Briefing of July 2018. Its wildest assumption was that UK goods trading with the EU under WTO rules would immediately incur tariff, non-tariff and customs charges with a total tariff equivalent value of 30%. It qualifies as wild because the total tariff equivalent value of the goods exports of United States and Japan to the EU have been reliably estimated to be just 20%, or only two thirds as much as those the Treasury predicts for UK exports after a no-deal Brexit, even though its product standards are identical to those of the EU.
Patrick Minford analysed these non-tariff and customs charges in considerable detail, and pointed out that some of the barriers conjured up by the authors of these predictions would be discriminatory and therefore illegal under WTO rules, which the EU generally respects. Why UK civil servants should assume that their EU counterparts would deliberately ignore them post-Brexit is unclear. However, with the help of the 30% total tariff equivalent value, leaving with no EU deal and trading under WTO rules again emerges as the worst post-Brexit option, resulting in a shortfall in UK GDP by 2030 of about 7.7% versus what it would have been had the UK remained an EU member.
The third set of predictions was published in November 2018 specifically to inform Members of Parliament about the long-term economic consequences of various future relationships with the EU in advance of their fateful ‘meaningful vote’ on the agreement negotiated by Mrs May. It contrives, as Andrew Lilico observed, to show the ill-effects of trade under WTO rules by the simple ploy of exaggerating all the future gains of EU membership and minimising all the possible gains that might follow the UK taking back control of immigration, regulation and trade policy.
The outstanding example of the latter is the 0.2% gain to GDP that it estimates would result from FTAs that the UK might conclude with the US, Australia, Canada, India, China and 12 other non-members. It qualifies as an absurdity because the European Commission had previously estimated that the gain to EU GDP of concluding agreements with a similar set of countries would be 1.9%, almost ten times as much therefore as agreements negotiated by the UK alone which would, one imagines, be better tailored to British exporters.
By repeatedly making other estimates in a similar manner, the report arrives at the desired prediction. Indeed, the final prediction that made the headlines, a 9.3% shortfall in UK GDP by 2035-36, was reached simply by assuming that there would be zero immigration from EEA countries until 2035-36, a proposal that no one has ever made. The recently published White Paper suggests it is far removed from any likely future government policy.
The remarkable thing is that any of these Treasury predictions have been given any credibility whatever and were not dismissed with a laugh, just as the predicted immediate consequences of a vote to Leave have often been. Part of the explanation must be that specialist publications like The Economist and the Financial Times, and specialist correspondents of other media such as the BBC, Sky, The Guardian and The Times did not check and flag these and other questionable assumptions and estimates on which these predictions depend.
Perhaps they did not have the time or maybe they welcomed Treasury support for the Remain cause, but a further reason one suspects, is that, like the rest of us, they wanted to trust Treasury mandarins. They saw them as honest, upright, non-partisan experts performing their duties by providing entirely trustworthy and reliable evidence to inform ministers and public debate.
Unfortunately, on European issues at least, this image is woefully mistaken. The Treasury has never regularly and dutifully conducted impartial research on the impact of EEC/EU membership on the UK economy. And it has never been asked to do so by any government since 1973, probably because ministers were usually engaged in persuading the ever-sceptical British public of the merits of European integration and doubted that empirical research would be an altogether reliable ally.
Since 2000, the Treasury has, like other departments, been obliged to conduct impact assessments of proposed legislation derived from EU regulations and directives, but it never sought to translate them into a meaningful national cost/benefit analysis. In 2003, at the time of the debate on joining the euro, Treasury mandarins searched the world for experts on optimal currency areas and debated and published their differing views shortly before the Chancellor announced his decision. The research conducted in 2005 and mentioned above was a one-off, and remained classified until an FOI request in 2010.
When they were asked to make the case for Remain, Treasury mandarins therefore had no historical analyses to draw on, apart from the 2005 one they wanted to forget. And they did not instantly assume a quasi-judicial impartiality. Apart from the one month purdah periods before the 1975 and 2016 referendums, they had never been asked to be impartial on this issue, and they evidently felt under no obligation to be impartial with respect to the division of opinion in the country at large. Hence, they immediately showed themselves to be fervent, unabashed advocates for continued EU membership and produced predictions to delight their all those who shared their view.
All of us have paid, and are still paying, a high price for the Treasury’s failure to conduct and publish impartial analyses of the impact of EU membership on the UK economy over the preceding forty-plus years in accordance with our image of them, and with their own core values and rule books. Had they done so, the referendum debate would have been rather more informed and enlightening than it was. Instead of constructing Project Fear for the Remain side, they might have tried to match Business for Britain’s superbly documented case for Leave in Change or Go.
In the course of such research, they would necessarily have had to understand and explain why the exports of countries trading with the EU under WTO rules, like the United States, Canada, Australia, Singapore and a host of emerging societies have been growing so much faster than the supposedly frictionless ones of the UK over the life of the Single Market. American exports to the EU, for example, grew by 68% from 1993 to 2015, and the smaller British exports by just 25%. If trading with the EU under WTO rules has proved so successful for others, why would it be the worst possible option for the UK after Brexit?
They might also have been able to explain why it is that UK exports to 111 countries around the rest of the world under WTO rules have also grown so much faster than its exports since 1993 to the EU itself, and to those countries with which the EU has negotiated trade agreements from which the UK was supposed to benefit. These are questions that the Treasury mandarins have preferred not to address.
Much relevant evidence to determine whether or not trading under WTO rules is the worst post-Brexit option could be obtained from UK companies which currently trade with the EU from a member country and with the rest of the world under these rules, since they are able to make direct comparisons. The Treasury is well-placed to conduct such research via HMRC but this is more evidence that it has decided it, or the government, or the country does not need. Some companies have, however, spontaneously testified about their experience of trading under both systems. It directly contradicts the sharp contrast between them which the Treasury has sought, with some success, to make the centrepiece of the debate about the UK’s post-Brexit options.
Lord Bamford, Chairman of JCB, the UK’s largest manufacturer of construction equipment, for instance, recently felt ‘compelled to say this about a no-deal Brexit: there is nothing to fear from trading on World Trade Organisation (WTO) terms… Trading with Australia on WTO terms is as natural to us as trading with Austria on EU single-market terms. John Mills, founder of JML, which sells to ‘80 countries at the last count’, said that ‘about 80 percent of all our international trade is on WTO terms, so we know what the paperwork’s like. Once you’ve done it half a dozen times, you’ve got it all on the computer, it just isn’t that difficult.’
Even more emphatically, Alastair MacMillan, whose company exports to 120 countries in the world including every EU member, points out that ‘there is little difference in the way we handle freight going to the EU compared to the rest of the world. The United States is our biggest market and we compete directly against US companies in their own market, in part, because we deliver next day to anywhere in the United States by 1pm their time, customs cleared. That, to me, is frictionless trade and it is at a cost that is not dissimilar to the same service to customers in the EU’.
The post When it comes to the EU, the Treasury has never been impartial and its predictions cannot be trusted appeared first on BrexitCentral.
Brendan Chilton is co-author with Lord Lilley of 30 Truths about leaving on WTO terms: Why WTO offers a safer haven than the Backstop, which is published today by Global Britain and Labour Leave.
The tone of the language we so often hear and the words we frequently read associated with trading on World Trade Organisation terms is negative and promotes images of chaos and disorder. All of this is based on deliberate fear.
Phrases such as ‘crashing out on WTO terms’ and ‘no-deal Brexit’ and ‘being forced to revert to the WTO option’ conjure up an image of a future in which the United Kingdom loses out and becomes an economic basket case. The terms are frequently and loudly spouted by those campaigning for a second referendum and are supported by biased voices within the media. Their objective is to determine that the United Kingdom must Remain in some shape or form entangled within the European Union even after the democratic decision of the people to Leave is implemented.
The reality of the situation, however, is that a United Kingdom operating under World Trade Organisation rules will be one of the greatest liberating experiences to achieved by this country in modern times. The United Kingdom always was a global free-trading nation – and now it will be once again, participating in every corner of the world. Far from being a perilous course, World Trade terms are a golden opportunity to reignite the industrial and commercial might of this country and it is a course that the Labour Party should completely support.
The Labour Party is not primarily a liberation movement. It is not primarily a social movement or a movement for emancipation. The Labour Party’s primary and fundamental nature and purpose can be understood by examining the title and description of the party – Labour. The Labour Party has been, is, and always will be a party of labour. Of work.
Its root and brain are an element of economy and its purpose is the representation of labour within the political institutions and a democratic framework of the nation state. Its motivation is the betterment of the lot of labour within the country and the world. Its purpose is to protect the advancement of labour and secure more for labour. This is achieved through an economy that is wealth-generating.
At its heart, Labour is a party of industry and commerce and, yes, of finance too. In the modern world, those factors are units of the economy not restricted solely to Europe but are the norm the world over. Labour’s standard should therefore be world trade and not an obsession with a Single Market serving the most developed, most privileged, most advanced part of the world shielded and protected by a great wall called a Customs Union.
The language of the Labour Party must turn from fear and concern to optimism and hope: the optimism that once again Labour can truly be the party of labour by embracing trading terms outlined under the World Trade Organisation to revitalise sectors of our economy, to embrace new markets, spread the protections and securities our workers enjoy to the rest of the world and ensure a wealth-generating economy improves the lives of people in this country and others.
Labour’s radical economic programme outlined in the 2017 manifesto is one that would restore industry, spread commerce and excite finance. In order for the manifesto to be delivered in the most productive way that manufactures growth, the Labour Party cannot support the Withdrawal Agreement negotiated by the Prime Minister and it cannot support an ongoing relationship with the European Union that grants economic jurisdiction to Brussels. The next Labour Chancellor of the Exchequer must be in a position to exercise all the levers of the state and tools as his disposal to ensure our economic programme can deliver for the many in this country and inspire others across the world in a true act of solidarity.
It is right that the Labour leadership is resisting calls for a second referendum on our membership of the European Union. It is now very unlikely that a second referendum will take place and this is, in part, due to the battle against one being fought by the leadership of the Labour Party. Now victory on that front is in sight, it is the time for the leadership to focus its attention on the next battle in this great struggle for the revival of our economy and the prospects of this nation in the long term.
The Labour leadership now needs to fully embrace with heart and hand a Brexit that enables the United Kingdom to be free from the shackles of Brussels and which allows our country to walk onto the platform of World Trade. By doing this, Labour will set the course for the future, it will demonstrate its ambition and ideals and will ensure that the next Labour government can embark upon a radical national economic agenda that transforms this country from a nation secluded in Europe to a nation manufactured and secured in global trade in the modern world.
The post Trading on WTO rules will be a liberation for the UK – and the Labour leadership needs to embrace it appeared first on BrexitCentral.
- Legally British subjects until January 1983, [...]
- Remainers ask me with ever greater frequency: [...]
- Deputy leader to call on party to show [...]
- Shadow Brexit secretary to call for MPs to hold 'open and frank debate' to find 'credible solutions' to current crisis
- 'It is right that we wait until the process of leaving the EU concludes before considering the matter further'
- Disorderly exit from EU 'may temporarily prevent cross-border trade' tech giant tells small firms