Faisal Islam Profile picture
Aug 7, 2019 14 tweets 4 min read Read on X
Another No Deal story on #bbcnewssix

We reveal the rather recent changes to the secret “reasonable worst case scenario” assumptions for No Deal Brexit trade flow that are the foundation for the Government’s No Deal planning.
...last year Government’s reasonable worst case scenario (revealed to industry under NDA but not public) for trade flows across Channel was incredible fall of 75% to 87% - so only 2 in 10 lorries flowing.

That was improved to 50-70% in April
& 40-60% in past few days BBC told
/1
...reason is really rather interesting - original catastrophic assumption done without French cooperation - on basis of 100% manual customs & regulatory checks (& required officials studying satellite photos of French ports)...upgrade has come as a result of new French facilities
... what this means in practice though is instead of 8000 lorries a day stuck either side of the Channel in a reasonable worst case scenario, and queuing capacity in UK filling up in days, it is more like 5000, which would fill up space in a fortnight... /3
...so in less catastrophic worst case scenario territory rather than actually good ones. But if you re a glass half full person, you might welcome progress...my understanding is that medicines suppliers think the disruption will be significant even with a 20% reduction in flow /4
Logistics providers think assumed flow rates shd be further improved - but totally contingent on trader prep. Companies can be prepared as they like, but if the lorry in front hasn’t got an EORI number its still a queue... depends on whether small companies have the cash /5
Freight Transport Association point out that the support for traders from UK Government is just £750 per company - equivalent to two hours training on how to fill customs forms they never have before had to. Massive shortage of customs agents though etc /6
Other industries - eg food - far from convinced on Government extra optimism - and so for example, asking for competition policy changes for possible food supply coordination - my other report today /7
The really big point here though - that the original 2 in 10 assumption already assumed the waiving of all checks into UK at Dover/ Folkestone - the improvement comes from what was done on the French side - rather vivid example of how this really depends on Paris /8
FULL Story here: bbc.co.uk/news/business-…
Former Sainsburys Chief Justin King on @BBCNewsnight responds to our story on the governments internal assumptions on cross Channel trade flow, revealed to BBC news:
And I have also been told Government knows that there is a very significant shortage - perhaps 5 figures - of customs agents, as Pete says below..
FTA’s EU freight expert @S_LD_ told me in Calais about UK firms servicing European supply chains at 6 hrs notice with zero paperwork, now being told to
- get a customs agent (none available)
- needing 24 hours notice
- have to provide detailed inventory, eg weigh their supplies
For Just-in-time (& oft forgotten but equally important just-in-sequence) delivery of parts - this delay v tricky. £ slide helps a bit maybe.

Point tho not just basic EORI number required - each export will need new paperwork

EORI just base level prep & majority haven’t done it

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More from @faisalislam

Apr 12
Well, well, well.

US customs messaging note quietly slipped out last night shows that smartphones, the number 1 Chinese export to the US by value last year, exempted from the 125% tariff… alongside chips, processors, wafers, lcd panels, LEDs etc…

8517.13.00.00
Smartphones Image
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US has excluded the single biggest Chinese export, and certainly the most high profile finished good from the tariffs, without publicly announcing it…

Avoiding the very public repricing of IPhones etc across Apple stores, but only in the US….

x.com/faisalislam/st… x.com/faisalislam/st…
While obviously smartphones/ iPhones being exempted is big news for now…

Here’s full list of exemptions according to Harmonised US tariff codes that I plugged into its database… lots of semiconductor parts, circuits, processors, solid state storage, flat panel touchscreens 👀 Image
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Read 5 tweets
Apr 8
Author of Mar A Lago accord concept that US tariff agenda is basically designed to cause negotiated dollar weakening, (now WH chief economist), gave speech yday which basically suggested that reserve status for dollar was a burden which others might need to “write checks” for Image
turns on its head the famous description of ex French President then fin minister Valéry Giscard d'Estaing the US enjoyed an “exorbitant privilege” with $ reserve status…

Instead Administration appears to believe this is an exorbitant burden for which US should be remunerated.
It’s part of a narrative that seeks to paint new tariffs (accepted without retaliation) as justifiable payment for burden of strong dollar (eg on US manufacturing exports and jobs)… this new mindset is extremely consequential. The tariffs aren’t going.

whitehouse.gov/briefings-stat…
Read 8 tweets
Apr 4
👀

President just shared a video on Truth Social saying “Trump
Is purposely CRASHING the market” in order to lower US Treasury yields and the dollar.

The Mar A Lago theory I wrote about two months ago, written by his chief adviser that said tariff chaos would lead to $ deal Image
Here’s the video…

Dow down another 1000 points…

Obviously RT are not endorsements but why is the President choosing to share this stuff? And if you are another country seeing this, how do you negotiate with this?
Great to see the World Cup* trophy on this historic trade war document…

* the one being shared with Mexico and Canada Image
Read 9 tweets
Mar 30
👀 From Navarro’s numbers auto tariffs will raise $100bn a year (on $240bn imports) can replicate this calculation by assuming all imports hit by 25% and then US manufactured cars taxed about half that to reflect foreign content…

No exemptions tho…

…that assumes no behavioural change.

Note: will be a lot of behavioural change in supply and demand.

also says tariffs in general will raise $600bn a year of $6 trillion over a decade.

As total goods imports are only $3 trillion a year… “Liberation Day” equivalent of 20% universal tariff??
👀

Indeed Washington Posts chief Econ writer reports President instincts are to go bigger on “Liberation Day” … are we underpricing the return of the universal tariff? It would explain the otherwise inexplicable Navarro numbers this morning,..

x.com/jstein_wapo/st… x.com/jstein_wapo/st…
Read 10 tweets
Dec 2, 2024
NEW

Might remember I cornered Rwandan President Paul Kagame in January and asked if UK would get money back if no migrants were transferred to Rwanda… answer revealed today: Govt paid £715m so far until June of this year

“not recoverable under the terms of the Treaty” Image
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terms of Rwanda deal are quite something…

In addition to £715m already paid, Treaty another £100m is due (will it be paid?)

also envisaged £120m bonus after 300 refugees “transferred”. And £20k per person payment.

And then further £150k per migrant payment over 5 years Image
IF a relocated migrant then relocated from Rwanda, UK government would then pay Rwanda £10k for that onward relocation (instead of the last payments above) Image
Read 6 tweets
Oct 18, 2024
NEW

Treasury effectively confirms debt rule loosening, by announcing its new “guardrails” to channel capital spending goes to a 10 year pipeline of major projects that generate economic returns that will help “depoliticise infrastructure”

bbc.co.uk/news/articles/…
Their view is independent accountable bodies, either new or given new powers will set & implement a 10 year infrastructure strategy integrated with 2 year spending reviews, and audit this, and assess value for money ensuring capital investment generates clear long term returns…
Ministers now openly call the impact of the Sunak debt rule “a mistake”, that it constrained some much needed public infrastructure investment, while not stopping bad investment in failing projects… capital needs to be properly quality controlled not arbitrarily constrained
Read 10 tweets

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