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Dmitry Grozoubinski @DmitryOpines
, 6 tweets, 2 min read Read on Twitter
🚨 - EFT Headline assumption about GDP Growth from Trade Liberalization offers as support wild misreading of Australian example.

The EFT say their modelling shows 2-4% growth from liberalization and this is consistent with Australia's 30 year experience.

1/
2/ Minor issue there guys, in 1986 (30 odd years ago) Australia's applied, weighted mean tariff rate of 7%-18.96%.

Under the EU's Schedule, the the UK has a trade weighted average tariff of 1.96-3%.

Source 1: data.worldbank.org/indicator/TM.T…
Source 2: data.worldbank.org/indicator/TM.T…
3/ For Australia, which has never exactly been a manufacturing powerhouse in most sectors, reducing what were sky high tariffs on near everything generated a lot of benefits.

To suggest the UK could see similar results, even fully liberalizing is insane. There's far less to cut!
4/ In case it isn't obvious, Australia in 1988 also wasn't in a Customs Union with it's largest trading partner, and that Customs Union it wasn't in didn't have FTAs. It also did far less trade with LDCs or developing countries via tariff reducing preferential schemes.
5/ This is all set out in the paper the EFT cites to support its claim.

Prior to tariff cuts in 1988 Australia was among the most protectionist developed countries.

Except in select lines (mainly in Ag) the UK in the EU is among the most liberal.

data.worldbank.org/indicator/TM.T…
6/ This shouldn't need explaining, but a morbidly obese patient will probably see greater health improvements from improved diet and exercise than an elite athlete will from cutting out the chocolate bar they eat on their weekly cheat day.
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