Another tweet convincing me of the need of basic trade training for MPs and MEPs. This tweet is nonsensical, Ms James (short thread)
1) "The EU operates 13,000 tariffs". Tariffs are imposed on goods. As different goods are subject to different tariffs, you need to classify the goods. The method by which this is done is the "Harmonized System" (HS)
2) The Harmonized System is a nomenclature and classification of all goods. Yes. That is stunning. It is actually maintained by the World Customs Organization, another international organization you've never heard about.
3) Countries are free to use their own system, but let's be honest: what a waste of effort that would be. So all of them more or less use the HS. Different versions exist, it is continuously updated. And the different versions mess up statistics.
4) Classifying goods under the HS is a fun game, given the differences in tariffs it makes a big difference whether you export a monitor or a TV. But let's get back to the MEP's erroneous tweet.
5) As almost all countries use the HS, the "13,000 tariffs" charge is fun, but really mostly directed against the world at large, unless you add specifics of artificially splitting tariff lines. Which also happens....
6) Where can you read up on the HS? wcoomd.org/en/topics/nome…
7) Now to the second part. "5000 non-tariff barriers". This will be difficult. What exactly is a non-tariff barrier? I have had a nice debate about this with experts, you can define them differently.
8) But let's avoid the problem of defining them ourselves, shall we. So: "Non-tariff barriers refers to all barriers to trade that are not tariffs." Source: OECD stats.oecd.org/glossary/detai…
9) Now let's just look at some. Let's say to become a solicitor you need to pass a test. Barrier. You need to be able to speak English in court. Another. You need to physically show up. Another.
10) This is fun game, but let's stop here. How meaningful is it to say we have just identified three barriers. Or let's say English is part of the test. Now suddenly they are two barriers. The point is: how do you put a number to this? And how do you make it meaningful?
11) The answer is: this is not easy at all. But even if you end up with a methodology to measure something in this field, giving a number out of context might sound impressive, but is utterly meaningless.
12) So is Ms. May a hypocrite when criticizing Trump? No. You can try to defend Trump's measures, certainly, but not the way you did it.
13) And finally: a starting point for your research on non-tariff barriers (or non-tariff measures which, depending on your definition, might or might not be the same) unctad.org/en/Docs/c1em27…
