I’m not so sure about these arguments. They seem to cut a certain number of factors out, some of it just silly, and I would be interested to find out if this was a formal analysis, or the same nonsense we've been hearing for years.
So many of our supply chains have been disrupted already. OK, let’s assume that there are no supply contracts in place. I seriously suspect there are, and cancelling them may be a problem, but let’s assume they aren’t.
Now businesses have to look for replacements, a cost that is always overlooked when people talk about trade deals. Only this time they will be doing it with money the company may not have right now.
And the assumption is that businesses are going to be able to do that, and be able to source them locally? What if the demand is greater than the supply?
This is a rookie trade deal mistake. Not taking into account adjustment costs.
This is a rookie trade deal mistake. Not taking into account adjustment costs.
The argument seems also to based on the idea that, in the middle of disruption companies throw their client list away and spend time and money starting from scratch.
This is laughable.
This is laughable.
That’s for our importers, as for our exporters, the UK’s message is very clear, customer acquisition over customer retention, because maybe they believe that’s cheaper? It’s not.
Most exporters will be trying to maintain their export supply chain as best they can.
Depending on pricing policy, the domestic cost could be dependent on total sales, and cutting the EU off as a market will result in higher prices for us.
There are other markets, but there is also the issue of reliability. Some supply contracts involve guarantees on reliability. Ocean freight is often not reliable enough. Exporting certain goods just isn’t practical because companies can’t meet the contract terms.
And then there is probably the hardest hit sector for tariffs, which is intra-company trade.
The adversarial way this debate has gone “They buy more from us” does not remotely take into account foreign investment either way. 
If barriers are put up, those companies aren’t going to say “Let’s get our supply from someone else but ourselves”, or at least it’s unlikely the barriers will make the difference if substitutes are available.
Then there is the fact we’ve been in the Single Market for so long we’ve experienced amalgamation.
The “We can buy oranges from other countries” is true, but you may have to order them yourself. Some supermarkets do fruit wholesaling, but a lot of the sector is owned by EU companies.
And while fruit is brought in from further afield, not to the same capacity, it may be affected because our air-freight is dependent on EU airports.
Supermarkets also have to bear the brunt of a reduced shelf life caused by longer lead times, so they may not want to go further if they don’t have to.
There is then this quote: “The prospect of extra customs checks are nothing compared to the airport queues, travel quarantine and temperature checks which may ensue once countries come out of lockdown.”
Is the argument really that we won’t care as long as we have a plane to catch? Or that with the delays to air freight, the unnecessary goods freight delays won’t be felt by businesses?
Seriously, where is the logic in this?
Seriously, where is the logic in this?
But it gets worse: “The shift towards ‘supply chain security’ means that cross-border supply chains will become less important”
WHAT ARE THEY TALKING ABOUT?!
If borders are more important without ‘supply chain security’ then no deal stops the very thing that is providing supply chain security.
If borders are more important without ‘supply chain security’ then no deal stops the very thing that is providing supply chain security.
In the event of no deal, the AOC certificates used in supply chain security will not be recognised by Andorra, Norway and Switzerland, along with all the EU countries.
Is the UK really going to turn up and argue with the EU that they don’t need a deal because the thing that needs a deal is going to make the deal less important?
Or is this some kind of strategy where they also tell the EU that the pandemic means they expect businesses to throw their client lists away and start from scratch.
A clever deceit to ensure the EU gives us deal in fear of the genocide that may follow should they leave our trade future in this muppets hands.
Businesses aren’t going to be throwing their client list away, intra-company trade isn't going to stop.
No, this pandemic has not created a situation where businesses will be unaffected by no deal. It will make the recovery harder.
No, this pandemic has not created a situation where businesses will be unaffected by no deal. It will make the recovery harder.
And the scariest part is when it talks about reconstructing the economy. They used to believe in the free market, but now it seems they are all about intervention.
They don't really seem to understand business at all, and this is very worrying.
/End
They don't really seem to understand business at all, and this is very worrying.
/End
