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Sunday, March 18, 2018

So In Post Brexit Britain Who Are We Going To Trade With – The Martians

As May, that’s Theresa May the unelected PM who not only thinks the will of the British people is held by 37% of the voting public but also thinks parliament is no longer sovereign attempts to get the Indian government on her side by promising the exact opposite of what they want, let’s look at what the so called utopia of world trade promised by the Leavers has produced so far.

Australia – Britain is at the ‘back of the queue’ for a trade deal with Australia after the country’s minister in charge of striking them said a UK agreement could be almost three years away and would come after an EU pact.  Australia’s trade minister has told the UK that any post-Brexit trade deal between the nations will have to wait for his country to complete parallel negotiations with the European Union. Canada has just taken seven backyears to complete a trade deal with the EU. Trade Minister Steven Ciobo warned that negotiating deals are “fraught with complexity” as he and his UK counterpart Liam Fox launched a working group to scope out a potential British arrangement. He emphasised that once formal talks did begin post Brexit, trade deals can be difficult to complete: “Negotiating trade deals is fraught with complexity. So we are looking at a window of time of around 5-6 years minimum before trade deals are put in place with Australia. And in the meantime we eat………..

China – It will be difficult for the UK to reach an agreement with China without first establishing a new post-Brexit partnership with the EU. Negotiating tariffs with other WTO members will be a pre-condition if the UK exits the EU customs union, and this process will require time and effort. Even if the UK reaches an agreement with China, the UK cannot serve as a back door for Chinese products to enter the EU, because the EU is very likely use rules of origin to close any such loopholes. And this relies on May’s government being able to maintain some form of access to the free market. Unlikely with the likes of Fox, Davis, Gove and Johnson screaming from the front bench that the will of the people will be betrayed if such a thing occurred. this of course despite the fact that leaving the free market was never on the Referendum ballot paper.

Japan – Japan issued an unprecedented 15-page warning about the consequences of Brexit. This was swiftly followed by a message from Japan to the UK that there could be a string of corporate exits from the UK unless some of the privileges that come with access to the single market are maintained. That’s the single market that people like Davis and Fox want us out of.  The lengthy document from Tokyo gives a list of possible consequences of Brexit and a series of specific requests from Japanese businesses. About half of Japanese investment in the EU comes to the UK, including from companies such as Nissan, Honda, Mitsubishi, Nomura and Daiwa.“Japanese businesses with their European headquarters in the UK may decide to transfer their head-office function to continental Europe if EU laws cease to be applicable in the UK after its withdrawal,” the report concludes. Of course we all now know that following the Nissan coverup May is willing to just transfer money from the taxpayer to Japanese firms in a brib to get them to stay. Money from where? The NHS? Wefare? Pensions?

USA – We all know Theresa May had a difficult start to the G20 summit with President Barack Obama saying the UK would not be the priority for a US trade deal. A policy that is likely to continue with the almost certainty of a deal3Clinton administration.Obama also raised the risk of some trading relations unravelling and made clear that it “would not make sense to put aside” existing negotiations with big blocs of countries in order to do an immediate deal with the UK. For some it may seem strange that a country will prioritise trade with 508 million people (the EU) over that of trade with 55 million (the UK). So not so good there either.

Canada – Well they have just completed a trade deal with, yes you guessed it the lot Brexiteers are keen to get away from. So with 508 million new customers it may be assumed Canada is going to be pretty busy over the next few years. So it might well be ‘a trade deal with the UK. Yes sure give us a buzz some time. Got to rush, busy, busy.’

IndiaTheresa May has dashed Indian hopes for a more liberal visa system for its nationals wanting to work in the UK by arguing that the current offer is generous enough. The comments will prove disappointing for some intrade the Indian government and business community who have argued for more of their highly skilled professional workers to be able to get six-month visas for the UK and other European countries. So once again a poor start at negotiations by the May government. India’s PM Narendra Modi used a speech to heavily hint that he wanted young people to be more able to travel abroad to study, after stricter rules in Britain on how long graduates can stay contributed to a halving of the number of Indian students coming to the UK to study over five years. However, May had earlier made clear she was aware of sentiment in the UK about immigration, and her promise to stick to an ambition of reducing the net migration figure to the tens of thousands would require cutting the numbers from all over the world. So it seems we are willing to adopt a policy of isolationism over the requirements of open trade. Things look like they may be tough with trade with the billion potential customers in India.

Ok we could look at other individual countries but in general the results would appear to be the same. So what about the World Trade Association. Negotiations about the shape of the UK’s post-Brexit trade arrangements would have to start from scratch after a leave vote in the EU referendum, the head of the World Trade Organisation said as he admitted there had been no preliminary discussions with the UK government. So we need around two years to start these negotiation which will be with an organisation representing 164 member states. Now that could take some negotiating.  And let’s remember this will be a UK in a very weak position having very few trade deals in the safe having just voluntarily left the free market, one of the biggest trade blocks in the world.  Roberto Azevêdo, the WTO director-general, said he expected any talks to be long and difficult, adding: “We haven’t had any discussions about the process. We don’t know what the process would be. We do know it would be a very unusual situation.” Oh dear here we go again. But didn’t Liam Fox say the world is desperate to trade with the UK.

Azevêdo said the position was complicated by the fact that all Britain’s trade commitments had been negotiated by the EU and that these would cease to apply in the event of a decision to leave. Warning that it would be impossible for the UK to “cut and paste” its old EU trade deals into new agreements, Azevêdo said the UK would be starting from scratch without the institutional machinery necessary to negotiate trade deals. He said Britain did not have the investigative bodies that would look into issues such as steel dumping. “It doesn’t have the official capacity. There is no institutional mechanism to conduct an investigation. That body of human resources would have to be set up fairly quickly.” So basically the WTA doesn’t think we even have the necessary skills to set up entry into the organisation.

OK Boris, Liam and David it seems we need to conquer space travel in the next two years so we can get up there and start negotiations with those Martians. Come on Chop Chop

This article was amended 09.59 07/11/6 with the word Britain added to the title.


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