The Consequences of Brexit (part 2)

[Jeffrey Shaw]

I find it a bizarre statement. As Jeffrey has a brain, then I thought he might do us the courtesy of clarifying the comment.

Easy. Law is law in the UK only if arising from Common Law precedent or enacted via Parliament and Royal Assent.

Hence external entities' edicts are not law in the UK [e.g. those of the EU] unless incorporated- via Parliament and Royal Assent- into UK law.

[L00b]

Easy. Law is law in the UK only if arising from Common Law precedent or enacted via Parliament and Royal Assent.

Hence external entities' edicts are not law in the UK [e.g. those of the EU] unless incorporated- via Parliament and Royal Assent- into UK law.

Whilst technically correct, this is far too simplistic, and potentially misleading.

 

The original question of unbeliever asked andyofborg to explain what "legal" means in the sentence "the only legal way to leave the EU is by Article 50".

 

Which Jeffrey sought to answer with:

"EU law: not law at all.

UK law: yes.

International law: no such thing"

 

Jeffrey's post above completely glosses over the fact that UK law has always been enacted and/or amended by Parliament to implement all those international treaties (international law, e.g. Vienna Convention, Berne Convention, European Patent Convention <etc.> there's umpteen more), of which EU Law (e.g. TFEU, Directives) is a subset) of which the UK is a signatory.

 

Statute-wise, Brexit is throwing tons of very interesting conundrums in all sorts of obscure ways. Like the UK's impending ratification (post-referendum) of the Unified Patent Court Act (international treaty, in which the UK recognises the supremacy of EU law ), and about which some of the best Counsels going in constitutional matters (Richard Gordon QC and Tom Pascoe) reckon that the UK will need to sign 2 further agreements with the EU to continue being a UPCA member state post-(actual) Brexit, or GTFO.

[unbeliever]

Civitas have done the maths:

http://www.civitas.org.uk/content/files/potentialpostbrexittariffcostsforeuuktrade.pdf

Cost to EU of no-deal WTO Brexit: £12.9bn in tariffs,

Cost to UK: £5.2bn in tariffs.

 

Now this is just the direct impact, but it's a substantial one.

Full disclosure: technically this is a prediction, but it's one with low uncertainties.

 

Presenting their imaginary £50bn leaving bill looks a bit daft in this context. Just taking a punt so they can try to rescue Greece for the 18th time i suspect.

[truman]

Civitas have done the maths:

http://www.civitas.org.uk/content/files/potentialpostbrexittariffcostsforeuuktrade.pdf

Cost to EU of no-deal WTO Brexit: £12.9bn in tariffs,

Cost to UK: £5.2bn in tariffs.

 

Now this is just the direct impact, but it's a substantial one.

Full disclosure: technically this is a prediction, but it's one with low uncertainties.

 

Presenting their imaginary £50bn leaving bill looks a bit daft in this context. Just taking a punt so they can try to rescue Greece for the 18th time i suspect.

 

How does any of this help the UK or make it a better place to do business?

[El Cid]

Civitas have done the maths:

http://www.civitas.org.uk/content/files/potentialpostbrexittariffcostsforeuuktrade.pdf

Cost to EU of no-deal WTO Brexit: £12.9bn in tariffs,

Cost to UK: £5.2bn in tariffs.

 

Now this is just the direct impact, but it's a substantial one.

Full disclosure: technically this is a prediction, but it's one with low uncertainties.

 

Presenting their imaginary £50bn leaving bill looks a bit daft in this context. Just taking a punt so they can try to rescue Greece for the 18th time i suspect.

 

So our exchequer will benefit, it could be spent on the NHS

[unbeliever]

So our exchequer will benefit, it could be spent on the NHS

 

Indeed.

 

How does any of this help the UK or make it a better place to do business?

 

It deters the EU from making Brexit difficult with obstacles or bad terms.

[truman]

Indeed.

 

 

 

It deters the EU from making Brexit difficult with obstacles or bad terms.

 

What are those figures as a %age of our respective trade?

[unbeliever]

What are those figures as a %age of our respective trade?

 

Our exports to the EU total about £220bn out of £510bn globally.

Their exports to the UK total about £290bn out of roughly £3000bn (can't find exact figure for their total globally).

 

What did you want to take a percentage of?

 

The reason that they're so much harder hit is that we specialise in selling them things which are generally low of zero tariff under WTO rules, where as they tend to sell more higher WTO-tariff things to us.

Agricultural produce is susceptible to especially high tariffs under WTO rules.

Edited February 8, 2017 by unbeliever

[L00b]

Civitas have done the maths:

http://www.civitas.org.uk/content/files/potentialpostbrexittariffcostsforeuuktrade.pdf

Cost to EU of no-deal WTO Brexit: £12.9bn in tariffs,

Cost to UK: £5.2bn in tariffs.

 

Now this is just the direct impact, but it's a substantial one.

Full disclosure: technically this is a prediction, but it's one with low uncertainties.

 

Presenting their imaginary £50bn leaving bill looks a bit daft in this context. Just taking a punt so they can try to rescue Greece for the 18th time i suspect.

The irony lies in two aspects of the report:

 

(i) this sentence:

This study is ‘static’, i.e. it does not take into account the elasticity of sales in response to tariff-induced price increases.

 

(ii) and a comparison of the respective sides in tables 2 and 3 (which are quasi-identical lists on either side, and thus compare like goods for like goods, or at least complementary goods).

 

This little write-up about the interrelation of elasticity and tariffs may help understand the point. In a nutshell: there is a Laffer curve for tariffs (who'd have thought?) and the point is that the EU, weighing in as it does (as a single economy) in economic size and activity relative to the UK, has much further rope to give in for absorbing the negative effects of elasticity than the UK.

 

Then we can place the report in its proper context: this report is looking at the import-export activity for 20% of the UK economy (tariffable goods, so industry/manufacturing). 75% to 80% of the UK economy is concerned with the provision of services (including their importing and exporting). Which aren't tariffed, but are wholly subjected to non-tariff barriers. What does the report say about NTBs?

Tariffs are not the only factor that could damage in the absence of a comprehensive trade deal. Regulatory and other non-tariff barriers (NTBs) could increase the cost of trading goods between the EU and UK and make it harder for exporters selling goods in either direction. These NTBs become increasingly significant as tariffs are reduced.

That's the "red tape" which the UK wanted to do away with by Brexiting (notwithstanding the fact that, whilst in the EU, there isn't any in import/export terms)

 

I have not looked at the political dimension of he exercise for the sake of simplicity, and to keep the debate reasonably objective. But by all means, if we were to factor in the number of comments from the Continent (and here I'm talking heads of large manufacturers like VAG and Daimler, heads of industry and professional associations - not politicians, never mind Brussels ones), whilst there is a clear intention to try and keep away from tariffs, there is a solid front of declared higher interest in looking after the EU's best interests. At the UK's expense (and sales of Audis, Beemers and Benz's therein) if need be.

 

Now, get on with Article 50 already, so finally we get to see what's what

Edited February 8, 2017 by L00b

[unbeliever]

The irony lies in two aspects of the report:

 

(i) this sentence:

 

(ii) and a comparison of the respective sides in tables 2 and 3 (which are quasi-identical lists on either side, and thus compare like goods for like goods, or at least complementary goods).

 

This little write-up about the interrelation of elasticity and tariffs may help understand the point.

 

Then we can place the report in its proper context: this report is looking at the import-export activity for 20% to 25% of the UK economy, involved with goods and their manufacturing/importing.

 

75% to 80% of the UK economy is concerned with the provision of services (including their importing and exporting). Which aren't tariffed, but are wholly subjected to non-tariff barriers.

 

What does the report say about NTBs?

That's the "red tape" which the UK wanted to do away with by Brexiting.

 

I have not looked at the political dimension of he exercise for the sake of simplicity, and to keep the debate reasonably objective. But by all means, if we were to factor in the number of comments from the Continent (and here I'm talking heads of large manufacturers like VAG and Daimler, heads of industry and professional associations - not politicians, never mind Brussels ones), whilst there is a clear intention to try and keep away from tariffs, there is a solid front of declared higher interest in looking after the EU's best interests. At the UK's expense (and sales of Audis, Beemers and Benz's therein) if need be.

 

Now, get on with Article 50 already, so finally we get to see what's what

 

 

 

Yes I did point out that this is direct costs only.

Other trade impediments than tariffs are obviously also important, but the impact on these can only be roughly estimated at best.

All services are tariff-free under WTO rules, so when one is assessing tariffs there is no issue of including them.