'The Brexit Arms' is now open. Friendly cosy pub with log fire for leavers & remainers to chat & ponder life, the universe, & Brexit.

[surferjet]

You are all most welcome

Ruth Lea's letter is very weak but I don't have time now to summarise why.

I will leave you instead with the LSE Critque of Economists for Brexit

I'll have a half pint thanks. What do you fancy Winchester? I'll get this round in whilst we have a chat about the WTO.

What's your understanding of the WTO rules Winchester? Perhaps you can help me a little better, because I do admit to be struggling with them and you seem to be better versed than myself from your comments. They seem far from simple.

From what I understand the WTO won't stop trade, but trade could be disrupted by individual nations due to disputes. So long delays in customs both here and abroad.

Its not unfair - the UK have to abide by the same rules as everyone else that's all. They are different and more complex than the ones we have got used so I think it will take a while to get our heads around.

This causes certain problems which the Uk seem not to fully comprehend yet. As I say I find it all baffling myself and so do quite a few journalists on twitter I've been reading who have also been trying to get their heads around it.

I am under the impression that there are a couple of rather large drawbacks with the WTO. For example, there has been the following suggestion that Nissan will be able to continue trading without barriers because the UK will negotiate a special deal on a sector by sector basis with the EU. Or if this fails the government might pay some sort of compensation to Nissan to keep it competitive.

Except government subsidies of this nature seem to be illegal under WTO rules and deals which favour certain sectors are also banned (No I don't get it fully). Apparently the US and Canada tried to do an 'AutoPact' and this got challenged and the WTO prevented them from doing this.

I also get the distinct impression that government ministers are also not fairing much better than me and the journalists and are also still in the process of learning the ins and outs of the benefits and drawbacks of the WTO as they definitely keep saying things which are not permissible under WTO rules.

I'm left with the feeling that it seems in essence that leaving the EU for WTO rules is swapping one set of rules which we have influence over but we have to abide by and are regulated by law outside the remit of the UK government, for another set of rules which we have less influence on (due to the number of members and its structure) and are still regulated by law outside the remit of the UK government. Is this true?

I have heard that quite a few Brexiteers favour the idea that we might go no tariff to solve the problem over how long it will take to negotiate deals and to speed up the process of rejoining the WTO as a single nature and to stop our exports being hit by high tariffs in the other direction.

However this seems to run into the problem that we will also have to accept very low cost imports from other places around the world in return and it will be potentially more difficult to protect certain sectors of the economy. Think China 'dumping' steel on the UK because we have to have a very low tariff on it, which means british steel is totally uncompetitive domestically and British companies can not make an economic case for buying it. Whilst we might be able to flog some British Steel abroad as production costs were low and our steel might not face the same tariffs into the EU for example (as China has high tariffs into the EU - which the rest of the EU want to raise but the UK is currently blocking), the cost of transporting it, due to the expense of fuel (in dollars) might not make it competitive to do so due to the relatively low value of the pound. Especially if you factor in the new red tape of sending to the EU (and the cost of doing this). Thus bye bye british steel industry.

The food industry could be particularly badly hit too. It might be great for the price of certain things, but this would be at the expense of british businesses meaning that jobs would be lost and any benefits of reducing prices in this way, would be lost because it still would not make food any more affordable to the people affected by such job losses. And of course if we are talking farming this would make us more dependant on imports rather than less which isn't great for our deficit nor our environment.

I certainly do not think the WTO option is anywhere as simple or straightforward nor economically profitable than the EU. I do think we would be wise to learn what possible problems there are with the WTO option (and there seem to be quite a lot) and whether this could slow down the export process at ports and whether what we are proposing is liable to end up in a dispute that needs to be resolved by an outside organisation which we have no sovereignty over. Then decide whether the WTO option is really a good route to go down for the needs of the UK. And to be honest about it, rather than just going for it out of a dislike for the rules of the EU or saying its really straightforward and there are no problems with reverting back to the WTO from a British business point of view.

What are your thoughts on the subject? How do you feel about British businesses being exposed to a much more competitive environment and what do you make of the problems of trying to do a sector deal especially for the car industry. Is there a way that you can think of that would be legal and would bypass such disputes and make it possible to trade in this way? Apparently we'd be likely to run into a problem upsetting the likes of South Korea with it.

Or do you think it really will be totally straightforward and not have any potential pitfuls or issues as a solution to Brexit? I'd very genuinely like to know how we intend to make the WTO work for the UK and at the moment, I'm struggling to see how it offers a better option solution to the EU in both economics and social consequences as a direct result of the knock on effects.

autumnair yep, moving to a country for many of us has a lot to do with love for that country. If you don't move there because you have a love for it already, I guess you develop it when putting roots down. That what makes it so hurtful for me and many other immigrants to realise that that love is unrequited. And it's not always been like that, but the anti-migration tone has increased significantly over the past couple of years and even more in the run-up and aftermath of the referendum.

Ruth Lea's letter is terrific actually. She talks a lot of sense. So many Remainer economists have been proved wrong so far.

Nobody said it's unrequited. You're imagining it. People don't want unlimited freedom of movement. That's a different thing to not liking immigrants.

So the fall in sterling is causing some immigrants to go home. That just proves they were only here for what they can get out of it.
It should certainly decrease the amounts we send to the EU in child benefits.
Yes, we want to know who is coming in and who is going out, and to have our own system, devised by us.

RedToothBrush Wow what a post! I'm learning with everyone else and read round before the vote.

It's my understanding that the WTO forbids punitive tariffs. That means at worst we’re likely to adhere to the same tariff as non-EU members, around 4.4%.

My doorbell just rang

I couldn't resist emerging from lurking for this ww

my doorbell just rang priceless

Rather proves my point yet again that you can't actually answer questions that don't suit you doesn't it.

Winchester punitive tariffs are one thing, but if you have a complex supply chain like the automotive industry this starts to get complex. And yes prohibitive.

There are parts made in the Uk which are shipped to the EU to make another part and then shipped back to the UK. This means that you have tariffs going both ways which add to costs which are high cumulatively rather than as single tariff thus end up becoming impossible to absorb on a long term basis due to the degree this eats into profits (and of course there is the additional cost of paper work). This means if you are a car manufacturer in the EU and UK you effectively would have to decide to base all your part production or source your component part suppliers either in the UK or the EU so you don't fall foul of this new barrier because its effectively crossed multiple times.

The punitive thing is fine if your product is simplistic and not part of a chain of production, but anything that is becomes a nightmare and soon adds up in terms of additional costs.

And as you point out punitive tariffs are prevented. Which means imports of certain things might become cheaper and therefore more difficult for British business to compete too. The assumption that its all one way traffic to markets outside the UK is flawed. Its good for more complex high end goods on the whole, but much less good for basic commodities such as food stuffs where margins are lower and more dependent on relative wages.

I found the following from Evershed's briefing on trade after Brexit interesting:

Trading under the WTO rules as a fall-back option after Brexit would mean that the EU would be obliged to impose its Common External Tariff on UK imports and the UK would be free to impose import tariffs on goods entering the UK (from the EU and elsewhere). The UK would face the same tariffs that the EU imposes on other countries, without any discrimination against the UK. The EU’s Common External Tariff varies from 0% on cotton, 11.5% on clothing, 25.6% on sugar and confectionery, to 45% on certain dairy products. Goods would also be subject to non-tariff barriers and UK exporters would face additional costs of clearing customs and the administrative costs of complying with the EU’s rules of origin.

www.eversheds.com/global/en/what/articles/index.page?ArticleID=en/Competition/brexit-trade-law-implications-vote-leave-eu

Hi guys.
< downs a triple vodka before attempting to read Red's posts >

WW to Widow You're imagining it. People don't want unlimited freedom of movement. That's a different thing to not liking immigrants.

Who are you to tell Widow she's imagining it? Who are the 'people' you mention? Not the ones who were writing anti-Polish letters in Tunbridge Wells after the referendum and beating people up for not speaking English. You're as bad as those morons on QT who booed the Polish woman for talking about how she felt. Widow has told you she feels less welcome. Maybe you could have the good grace to respect her feelings, even if you struggle to understand them?

"my doorbell just rang"
Next she'll be saying she 'can't be bothered'.

I'm back, my kid is home.
So while it not be a complex negotiation, it is a (Bremain) stretch to imagine UK goods held up in ports around the world. Globalists believe there is still a chance that Article 50 may not be triggered. Public declarations may be made with that in mind; in other words, a continuing Remain campaign.

Our dependence on membership of the EU single market is lessening. Even so, it would be expected to offer us favoured nation status and not to do so could be considered punitive under WTO rules.

In addition if we export nearly a third of our GDP, and about 40 odd per cent of that goes to the EU, that's around 10-12 per cent of gross dom prod affected by the single market. The rest of the economy would benefit from the new of not having to obey EU regulations. So as our economic growth gathers pace, it will be not just a requirement of the EU and the WTO to deal with us fairly and efficiently, it will be in their interest.

Well, you've covered yourself in glory there, WW.

"Our dependence on membership of the EU single market is lessening."

And

"Even so, it would be expected to offer us favoured nation status and not to do so could be considered punitive under WTO rules. "

These are both quite interesting statements and I would really like to know if they are based in fact. What is your source for them?

Do I need to dramatically hold you back Winchester??? We don't want to give the brexit arms a bad name when it's only just opened.

I hope no one reports those posts by ww

They should stand to illustrate the standard of argument from Leavers.

reds posts are fabulous because she is, dare I say it, an expert.

Lashing out because you can't defend your stance is a very slippery slope.

Oh btw, we're all going to Brussels for a week with the money in the swear jar.

Got to stay Winchester you've summed Gideon up well there

I agree with bearbehind