Brexit: No deal WTO rules consequences

[OliviaD68]

Much has been said in the press by the likes of Redwood, Rees-Mogg, BoJo, Davis, ..., that a Brexit option on pure WTO conditions with the EU would be fine, even preferable, for the UK.

Do we all know what the WTO option entails in terms of tariffs and non-tariff barriers (NTBs)?

Do we know which countries need to agree to this option - eg would the US need to agree for the UK to trade with the US on WTO rules?

Do we agree the UK would be better off? Worse off? Why?

WTO rules are the default - no trade agreement = wto rules.

@cdtaylornats

No country trades on WTO alone. What happens -in your view - if we are forced to

a) with the EU

b) with non-EU countries ?

Then we start to negotiate trade deals. We begin by saying to non-EU countries lets trade using the same deal we had when we were in the EU then see how we can improve it.

For example - we could cut grants to Africa but remove tariffs from African food imports. Tariff free on imports of Wine from the new world.

Guess how quickly we could sign tariff free deals ?

Lots of scaremongering stories are around - my favourite is our airlines can't fly to Europe - well in that case northern European airlines can't overfly UK on the way to the USA. Guess who loses most.

@cdtaylornats

Then we start to negotiate trade deals. We begin by saying to non-EU countries lets trade using the same deal we had when we were in the EU then see how we can improve it.

Isn’t this what Liam Fox just told Parliament wasn’t so easy? Also his Aussie trade negotiator said these people have been known to change their minds. He has four work streams on just with the US ... to roll over such deals - there are dozens.

So how quickly do you reckon we get this done with 60 countries covering dozens of agreements each?

@cdtaylornats

For example - we could cut grants to Africa but remove tariffs from African food imports. Tariff free on imports of Wine from the new world.

Guess how quickly we could sign tariff free deals ?

Not sure. I don’t think tariffs matter that much as most are close to zero anyway (except for foodstuffs and autos).

More important are NTBs don’t you think?

And what about tariff rate quota allocations on imports and exports - how do those get dealt with? Same question on subsidies?

Any ideas on MRAs ?

Lots of scaremongering stories are around - my favourite is our airlines can't fly to Europe - well in that case northern European airlines can't overfly UK on the way to the USA. Guess who loses most.

I thought the issue with flights had to do with qualifications of pilots and market access. Via for example Open Skies which EU has signed with the US.

US airlines have fifth freedom rights in the EU but EU airlines don’t.

Nothing to do with flying over a country. Or do I have this wrong?

@cdtaylornats

Here’s a link that describes a bit some of the problems aviation will have to overcome.

www.eureferendum.com/blogview.aspx?blogno=86656

Openskies is a Eurocontrol process devolved to them by the EU. Eurocontrol has 41 members including the EU and all of the EU members individually.

Up until a few years ago flying from Europe to enter the Oceanic track structure involved contacting UK Domestic ATC to route across the UK. As a convenience European airlines were allowed to contact Oceanic direct and the Oceanic controllers would route them at high levels straight onto Oceanic tracks. That can go away. Indeed UK airspace could be closed and routing to the tracks could require a couple of extra hours to go around.

www.tuaeu.co.uk/how-the-eu-starves-africa/

This is the Open Skies Agreement I’m referring to. It is not an agreement with the U.K.

So the U.K. has to have the same agreement with the US and then one with the EU.

Or planes don’t fly.

Agree?

@cdtaylornats So we’re clear: Open Skies and WTO are unrelated right?

To go back to the subject: how bad do you believe trading on WTO would be for the U.K.

A) with the EU

B) with non EU countries?

@cdtaylornats

I think you mean OneSky? I’m talking about bilateral and multilateral agreements to fly to respective countries. Not coordinating airspace (which may result from such agreements).

No Open Skies en.wikipedia.org/wiki/Open_skies

To go back to the subject: how bad do you believe trading on WTO would be for the U.K.

A) with the EU

Very

B) with non EU countries?

Very

Good. Now we are talking the same thing re Open Skies. The EU and UK and separately the UK and US will need to enter into agreements which seek to replicate the current Open Skies Agreement in place between the US and EU.

Now: how is this going to be done if the EU cannot technically negotiate with an existing member state?

So WTO means we are screwed in your view. I agree.

What’s your rationale? I suppose the reply could be valid for both categories of country right?