Right. Trade, independent nations, sovereignty and the UK's future relationship with the EU. A simple thread. 1/
Independent nations begin life without ready-made trade deals. They tend to want to sign trade deals in order, within the confines of WTO rules, to make trade easier with one another, and to promote economic growth. 2/
Make trade easier how? By removing or reducing customs and tariffs, and by agreeing to the equivalence of each others' standards. The agreements are complex - dealing with charges, standards, enforcement, etc. 3/
These deals depend on (perceived) common interests. We have in mind things which we want to sell to you; and you have in mind things which you want to sell to us. 4/
Deals are done when common interests are perceived to outweigh costs. Trust is a key commodity. To state the obvious, they rely on agreement on both (or all) sides. 5/
So... where are we as regards the UK and the EU? 6/
The fact that standards are currently aligned doesn't help much, given that the UK's stated objective is to have the freedom to diverge. 7/
The UK wants UK products to have access to EU markets (as now), and at the same time wants to have the freedom to diverge from EU standards. The EU is insisting that such access will only be granted if the UK commits to 'the level playing field'. 8/
There *is* scope for the two sides to discuss how stringent those commitments should be, and further how the agreement will be monitored and enforced. But it doesn't feel that we are at that stage. 9/
It feels like we are at a stage in which the UK is simply asserting its right to diverge and its ability to act as an independent nation. 10/
But... that is not in doubt. Simply, as an independent nation, the UK has to choose which commitments it is prepared to make in order to get a trade deal with the EU. Essentially, the greater the commitments, the easier the access to the EU market. 11/
If the UK isn't prepared to make some commitments, to choose to accept, or to maintain, particular standards, it will end up without a deal with the EU. 12/
If there is no accommodation, no offer which appeals sufficiently to both sides, there will be no deal, and the costs of trade (on both sides) will simply increase. 13/
Sovereign nations make decisions all the time which limit their future freedom of action. They do so because they calculate that it is in their interests to do so. 14/
The UK - now free from the strictures of the EU - has to decide what shape its relationship with the EU and the rest of the world is going to take. 15/
At the moment, the Govt is talking in terms of the elimination of all constraints on its freedom of action. It needs to start working out what sort of compromises it is prepared to make. 16/
I can't understand how, nearly 4 years since the referendum, the debate has scarcely moved. In the weeks and months ahead, that is going to change. 17/17
