“Free trade agreements do not offer free trade. That’s why a number of global trade organisations and experts do not refer to them as free trade agreements but regional/ preferential agreements. Read Prof Bhagwati’s work on this”.
I wanted to add some thoughts on it:
I wanted to add some thoughts on it:
2/ I agree 100%. Free Trade deals & Customs Unions, are simply mechanisms to give preferential arrangements to some over others. But Brexiteers are not naive and do understand this. Brexiteers want free trade deals with everyone but they want them on different terms to the EU
3/The EU's CU is a barrier to protect EU food & industrial production. The FTA’s the EU sign are designed to keep high barriers to protect domestic producers from competition (10.5% tariffs for cars 10-15% average tariffs for food/clothes/shoes etc).
4/UK benefits least of all EU members from this system because our economy is more service based. Outside the EU, the UK can agree FTA's which opens our markets to cheaper food & industrial goods in return for better access to their markets for services & high end manufacturing.
5/ The UK wins because consumers get more bang for their buck and our exports will soar as we open new markets. Not least because our FTA's will actually concentrate on services - something which the EU doesn't even try to do
6/ By their own admission there isn't even a single market in services in the EU. Yes, that will require adaptation by our domestic food and manufacturing producers.
7/But the example of New Zealand after UK joined EU & destroyed their export industry proves that this change can be successful & outside the EU we can use any number of mechanisms within WTO rules to aid in that process of change. Now is also an excellent time to make this step
8/Because the world is on the cusp of huge transformations driven by AI and robotics and industry 4.0 and that includes food production. @michaelgove original (pre Chequers) policy ideas at DEFRA point the way to how the UK can begin to make this transformation
9/This is why when Remainers argue that the UK with 65m people cannot begin to replicate the FTA’s negotiated by the EU with 500m people they miss the point entirely. The UK has absolutely no intention of replicating the deals the EU has negotiated.
10/We want deals which give our trade partners better access to our market than they enjoy now in exchange for better access to their market for the things that matter to us.
11/The idea that this offer for access to what is still the fifth largest consumer market in the world is unattractive does not hold water.
12/And this also explains entirely the EU’s behaviour in the Brexit negotiations. The EU enjoys a £100b pa trade surplus with the UK because our membership of the customs union and single market protects their food and manufacturing industries from global competition
13/If the UK leaves the CU & SM & signs FTA’s with ROW designed to open our market to their cheaper food & industrial goods, the EU will lose this £100b trade surplus whilst the UK will gain from increased consumer purchasing power & exports of services & high end manufacturing.
14/The EU’s entire priority in Brexit negotiations has been to keep the UK in the CU to protect their trade surplus and to prevent the UK becoming more competitive. The Irish border issue has been utilised simply as the mechanism to try to achieve these ends.
15/The withdrawal agreement and backstop keep us tied into a barebones CU with the EU with our only exit opportunity to agree to remain in THE CU for the long term. Thus preventing the very real economic benefits we could gain from Brexit by opening our market up to ROW
16/where 90% of global growth will be in the next 30 years. In short, Brexit is not an economic risk. It is a huge economic opportunity...
