Actual economic effects cont...

[ManonLescaut]

Telegraph: Britain could be up to 70 billion worse off if it leaves the single market IFS warns

The respected economic think tank said that Britain could enjoy an extra 4 per cent in national income if it remains in the single market, equivalent to two years worth of growth.

The report claims that while leaving the EU will free the UK from an estimated £8 billion a year of budget contributions, the loss of trade from Brexit could hit tax receipts by a larger amount.

It found new trade deals would be unlikely to make up for lost EU trade, which accounts for 44 per cent of British exports and 39 per cent of service exports.

Telegraph: Treasury looks at quitting the single market

Officials say the talks have revealed a willingness among some top figures to scrap passporting despite early calls to stay in the single market from some quarters...

Mr Boleat cast doubt over the UK’s ability to secure a Norway-style deal to remain in the single market. He said accepting free movement of people and paying large sums to Brussels while accepting its rules would not be politically acceptable.

The BBA wants the UK to leave the single market but retain unimpeded access to EU markets.

That's a very strong argument for Leave Peregrina to rebuild a manufacturing industry.

to rebuild a manufacturing industry. Should we not be trying to rebuild first? Not crossing our fingers and hoping that we will be able to rebuild it?

And what exactly are we going to rebuild a manufacturing industry with? We're not exactly awash with raw materials, and they now cost 15% more to import! We've been a base for e.g. the Japanese manufacturing industry, but we're about to lose that. Who on earth do you think is going to replace it? That great Brexiteer James Dyson? Oh wait...

James Dyson - yes, so committed to this country that he's moved manufacturing overseas.

Yeeeoooo

I am with you, EU is a shrinking block. Just for clarification:

(i) The 30% thing quoted by fact checks refers to the GDP of the EU28 countries. So A10 etc GDP as of 1980 are added to the 'sum' to arrive at that 30% figure.

(ii) The 30% is GDP (I assumed is PPP rather than nominal and constant currency) and not trade volume although they are somewhat correlated.

(iii) EU including UK currently has around 17.5% of the world GDP or around 14% ex UK. IF the current trend continues, then the number ex UK will indeed fall below 10% in a decade or two.

The EU isn't a shrinking bloc, both of you have such a tenuous grasp of economics its barely worth debating you on it.

That's put them in their place then hasn't it Smallfox!!

smallfox2002

OK Smallfox, a relatively shrinking block as a % of the world GDP.

Happy ?

Still topsy as pointed out before as world GDP has increased dramatically since 1980, its not an accurate comparison.

Using real terms it has increased, and using the size of the EU economy it is the largest in the world. So its a shrinking bloc, but still the largest economy in the world.

I don't need to put you in your place cocory, I still remember your vapid posts about an EU army and conscription as well as the other outright misnformation that you swallowed without investigating.

smallfox2002

It has increased in real term, but you have to admit at much slower pace compared to Asia, US, Australia and Africa and hence its relatively shrinking share. A trading group at the corner of the office which members have got the smallest pay rise never shouts to say "well... we have got the smallest pay rise but you have to respect us for getting a pay rise".

EU27 (i.e. EU28 ex UK) is certainly smaller than the US. It appears that according to Wikipedia, on PPP based EU28 is second to China in 2016.

en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)

"We are discussing how valuable free access to the single market is and what we should ultimately pay for said free access, the answer is around 10%"

Incorrect, we are discussing how valuable it is to us as an economy not as a measure of world GDP. To us it is worth 44% of exports directly and another 15% of exports to countries that have prefferential trade agreements with the EU, so 59% of exports. As 15% of our exports go to the US that means that the rest of the world you are so keen to trade with makes up 26% of all exports. On their own the BRICS countries combined make up 5%, combined!.

EU trade makes up 15% of our GDP and EU firms are the largest source of FDI, added to that we have many global firms that are here due to our access to the free market.

"9bil and open borders to 435million people to access this small proportion of world trade at slightly better rates than would be afforded under WTO conditions."

We already have WTO conditions with the rest of the world except for those that have preferential trade arrangements with the EU. However the question is, is it better to have worse arrangements with the EU which takes up such a lot of our exports and trade? Will the agreements with others increase trade enough, at preferential terms, in order to make up for the losses of EU trade and investment?

You can't take the UK economy out of the EU till it actually leaves.

The growth of Asia and Africa, has been down to the development of their economies from agricultural to industrial across the last 30 years. In 1980 the UK had a GDP 5 times that of China's. Australia's growth has been mainly based on exploiting their natural resources in order to sell to the Chinese growth.

On Chinese growth there are also questions about government manipulation of data too.

In any case, the argument for splitting from the EU because of the % of world GDP is falling is erroneous and incorrectly represented.

"You can't take the UK economy out of the EU till it actually leaves. "

Yes, but you also have to realise that UK chunk of economy will be accessible to us (as it is domestic) whether we are in or out of the trading block and so is not relevant to the argument.

"the argument for splitting from the EU because of the % of world GDP"

I don't think anyone argue that we should exit EU solely because its relative share of the world GDP is shrinking. However, it is wrong to argue that we have to stay in the EU at all cost because it is such an indispensable trading block - it isn't. It is very important due to geography, but not worth to be in it at a very high cost.

We will stay in the EU if the terms are right. If it is take it or leave it, then we go for the latter.

The high costs?

Which would those be?

Have you calculated the net benefits of being in the EU? The FDI from EU and global firms, the jobs they bring, the export demand created etc etc?

You took the UK economy out of the EU to lower it to 3rd in the world, however this is calculated with the UK economy still being the same size as it is whilst it is still in the EU so its erroneous.

"I don't think anyone argue that we should exit EU solely because its relative share of the world GDP is shrinking"

That's exactly what a PP was arguing!

I'll calcuate the high cost for you, most calculations put the net contribution at around £7.5 bn when you minus both public sector reciepts and private.

7.5bn is less than 1% of GDP, but EU trade is worth 15% of GDP, a far higher ROCE.

Smallfox - I might still be right about the EU army if reports this week are anything to go by.

Even so, we would still have had VETO on it, and it wouldn't have occurred had we been members. There never would have been conscription.

The talks that have happened have been based on the fact that the UK is leaving and what might be possible, not what will happen. You can't compare what is happening now that we are leaving to what would have happened had we had a say.

Even so the reporting over the last few days is disingenuous, the talks are regarding joint cooperation on security, coast guarding etc.

smallfox

I am sure you understand the word 'solely'. May I have the reference to your claim that 'someone' is arguing that we should quit because EU as a % of world GDP is shrinking.

I am afraid 'cost' is not just £ and euros but also the intangible stuffs. I know you invoke the caveat that we have not actually 'left', but so far so good and none of the threat scaremongering has even come close to materialise. Even your our favourite car factories and banks have not left.

Apart from the fall in the pound, warnings from investing firms that they are stalling investment till they find out what happens. No new trade deals till we negotiate exit, falls in house prices, a big and dramatic dip in the FTSE in which British based firms saw their values fall.

The current "bounce" is in short run data, and it shows that we are about where we were in some sectors before the vote. So we've had to have massive economic stimulus to carry on as normal and you think this is an indicator of strength?

All of the predictions were made if article 50 was immediately invoked, and in the long run if we left, based on different models. You can hardly say that things haven't come to pass.

Oh and using scaremongering and threats to describe economic expert analysis if funny. Especially when it is those experts that have advised on the policies which have kept the ship steady. Its also hypocritical, Turkey joining? TTIP? Refugees? Immigration? The leave campaign was all about fear.

I don't think you understand economics at all to be fair. Please tell me more about intangible benefits/costs? Have you used shadow pricing in order to evaluate them? Whose data are you using? I can guarantee you that a Cost Benefit Analysis will always come up with a far higher net benefits than costs for the EU.

Data - well the real stuffs like CBI PMI survey, ONS, LandReg data release. Not the 'expert forecast' stuffs.

I believe house prices are supposed to crash 18% if we voted leave (or when we actually left, it wasn't clarified). The last print was a +6.4% annual or -0.2% month to month.

"I can guarantee... Cost Benefit Analysis "
No you cannot because each of us value things differently.

Not everyone is a smallfox and not everyone is a topsy. However, 52% of the voters value things I value.

The fact that you offer 'guarantee' tells me that you do not understand economic, or at least real world economics outside a XLS spreadsheet.

I see BoE Gov Carney admitted today that the chances of Brexit risks materialising have diminished.

It appears that the Apocalypse has been postponed.

The fact that I can guarantee it means I get the issues.

You have entered just said If we voted leave the house price crash would occur, no it was if we left, house prices are down despite not leaving and the stimulus.

The data for August has been positive, butility it just slightly over corrects the falls from July, it doesn't show economic strength just short run differences.

The fact that you think 52 percent of voters value what you do? Laughable. The leave vote was a combinaction of groups with vested interests, very few have the same end goal or value the same things.

Look at the wider data and it's not all that great, growth will still be weaker than forecast without a leave vote, inflation is yet to kick in, the impact of businesses not hiring is yet to be felt.

The fact that you think economics is about xls spreadsheets shows your lack of understanding.

And hahaha your point about car factories? Did you not see the Japanese letter?

Nothing has changed, they have no reason to leave until trade relationships have changed. Investment might still stall, the banks and car factorised will leave if their relationship with the EU markets is jeopardised.

smallfox

"The fact that I can guarantee it means I get the issues. "

"..very few have the same end goal or value the same things. " - I suppose that applies to the 48% as well. They want in on balance for a variety of reason.

You seem to think that everyone values the same thing as smallfox - no variety, no collection of vested interest - just the rational smallfox. Do you see the irony yet ( I hold my breath).