Brexit: Now What? Part III

[Aepervius]

Nope, the only hope is that the EU survives and that the British (quite probably English) public eventually has a massive backlash against the knaves who led them down the disastrous path and begs to rejoin as good Europeans this time, and the EU realises that both the UK and Europe would benefit (though it would be less important for the EU).

Well , no offense but quite a few of us are sick of have been named the "source" of all UK ills for decades, not counting the general British public spite toward EU/EU Citizen. ETA: and at time it felt the UK was fighting against the EU from inside, as a sort of 5th column.

It will take quite a few crawling and begging to take the UK back in, e.g. give up the pound for example. ETA: and that's not counting that the UK is now branded in EU as the traitor which left at the first change of wind. It will be difficult to change that perception.

 

[McHrozni]

If it were to result in a boom in trade then it would require a fundamental reworking of the UK economy. The UK economy is a first world economy which focuses primarily on the services sector. Our major export markets are in the developed world and we export first world goods and services to them.

We'd need to re-jig our economy to provide the goods and services that the developing world needs, and more importantly, can afford. Unless we start paying third world wages then I cannot see how that can happen.

That and work trade deals to your advantage with the third world. They're keen to protect themselves from just that, so it could be a bit difficult to do.

This is why I advocate asking Brexitards, from Theresa May down, what will UK export and to whom that will substitute the loss of trade with EU, and how will lack of EU membership benefit that trade. What kind of a trade deal and with whom?

Lack of answer means they're bluffing.

McHrozni

 

[Archie Gemmill Goal]

If it were to result in a boom in trade then it would require a fundamental reworking of the UK economy. The UK economy is a first world economy which focuses primarily on the services sector. Our major export markets are in the developed world and we export first world goods and services to them.

We'd need to re-jig our economy to provide the goods and services that the developing world needs, and more importantly, can afford. Unless we start paying third world wages then I cannot see how that can happen.

Well if we are exporting first world goods we don't have to pay third world wages we just have to compete with Europe (OK? if you don't look too closely at the Eastern bit ...) US (OK maybe?...) Japan (OK possibly?...) Korea (erm OK-ish maybe? erm...) and China (oh...)

If nothing else we can probably sell them weapons. That's something we still seem to be pretty good at.

 

[Aber]

to whom that will substitute the loss of trade with EU,

Loss of trade with the EU should not be huge.

The same goods can be sold as currently, as they will meet EU standards. Tariffs may be applied, but those for cars are 10% for example. The value of the pound has fallen by more than that since the referendum. Therefore UK made cars are now more competitive to sell in the EU (with tariffs added) than they were before the referendum.

 

[McHrozni]

Loss of trade with the EU should not be huge.

The same goods can be sold as currently, as they will meet EU standards. Tariffs may be applied, but those for cars are 10% for example. The value of the pound has fallen by more than that since the referendum. Therefore UK made cars are now more competitive to sell in the EU (with tariffs added) than they were before the referendum.

The greatest expected loss (by far) is in services, which seems to be completely out of grasp for the average Brexit 'analyst'.

McHrozni

 

[GnaGnaMan]

Loss of trade with the EU should not be huge.

The same goods can be sold as currently, as they will meet EU standards. Tariffs may be applied, but those for cars are 10% for example. The value of the pound has fallen by more than that since the referendum. Therefore UK made cars are now more competitive to sell in the EU (with tariffs added) than they were before the referendum.

Most of the parts are imported. Those become more expensive as the pound falls. On top of that there is a 4% tariff on those parts.

A weak pounds makes british labor cheaper but there's no shortage of cheap labor in the EU.

The only reason I see to keep manufacturing cars in the UK is that moving a plant might be too expensive.

 

[Aepervius]

Loss of trade with the EU should not be huge.

The same goods can be sold as currently, as they will meet EU standards. Tariffs may be applied, but those for cars are 10% for example. The value of the pound has fallen by more than that since the referendum. Therefore UK made cars are now more competitive to sell in the EU (with tariffs added) than they were before the referendum.

10% can make a huge difference. Say I am in germany and want to buy a car and I have two choices (before adding VAT) : one car before brexit was 7500 (came from UK -loss of pound already counted) and the otehr 8000 (came from France). Then a 10% Tariff makes the new price 8250 (7500+750 from UK) 8000 (came from France).

That can be enough to make people shy from a product toward another.

 

[Aber]

That can be enough to make people shy from a product toward another.

Agreed, but there will not be a catastrophic fall in trade as some posters imply.

The problem with your example is that before the Brexit referendum the euro cost of the UK car would have been 8750.

 

[Archie Gemmill Goal]

Loss of trade with the EU should not be huge.

The same goods can be sold as currently, as they will meet EU standards. Tariffs may be applied, but those for cars are 10% for example. The value of the pound has fallen by more than that since the referendum. Therefore UK made cars are now more competitive to sell in the EU (with tariffs added) than they were before the referendum.

They will meet EU standards up until the standard changes. Which could be the day after. And they will no longer be produced in the EU regardless of which standard they meet which could present issues not least of all admin and paperwork

 

[GnaGnaMan]

10% can make a huge difference. Say I am in germany and want to buy a car and I have two choices (before adding VAT) : one car before brexit was 7500 (came from UK -loss of pound already counted) and the otehr 8000 (came from France). Then a 10% Tariff makes the new price 8250 (7500+750 from UK) 8000 (came from France).

That can be enough to make people shy from a product toward another.

Agreed, but there will not be a catastrophic fall in trade as some posters imply.

The problem with your example is that before the Brexit referendum the euro cost of the UK car would have been 8750.

Please work this through properly.

The price of the car is the Value of the Imported Parts (VIP) plus the Value Added in Britain (VAB).
Price = VIP + VAB

The advantage from a weaker pound only applies to the VAB. The VIP is hit by 4% tariffs on imported parts.

 

[Strawberry]

The EU are now saying the Brexit bill has gone up to £100 billion....

http://webcache.googleusercontent.c.../content/cc7eed42-2f49-11e7-9555-23ef563ecf9a

 

[Giz]

The EU are now saying the Brexit bill has gone up to £100 billion....

http://webcache.googleusercontent.c.../content/cc7eed42-2f49-11e7-9555-23ef563ecf9a

Silly of them. 60 billion is worrying and might put pressure on May. 100 billion just looks like unreasonable bullying that could rally Brits behind her. The EU are playing with nationalistic fire.

 

[Archie Gemmill Goal]

Silly of them. 60 billion is worrying and might put pressure on May. 100 billion just looks like unreasonable bullying that could rally Brits behind her. The EU are playing with nationalistic fire.

Talking of playing with fire the SNP should be taking careful notes on what Westminster's position is on having to meet obligations when you leave a Union and how assets are redistributed.

Let me guess though. That's different...

 

[McHrozni]

Talking of playing with fire the SNP should be taking careful notes on what Westminster's position is on having to meet obligations when you leave a Union and how assets are redistributed.

Let me guess though. That's different...

The irresponsible positions of Westminster are a godsend for SNP.
If Westminster insist on paying nothing, that's precendens SNP can use for Scotland to leave UK as a debt free nation, while siezing all Union assets in Scotland, from naval bases down.

McHrozni

 

[McHrozni]

Silly of them. 60 billion is worrying and might put pressure on May. 100 billion just looks like unreasonable bullying that could rally Brits behind her. The EU are playing with nationalistic fire.

It could be EU is fine with UK crashing out without any sort of a deal, to make it a warning against any other wannabe leaver state.

Henry Morgan announced movements of hundreds of jobs to the continent. London City will be a much smaller financial center by 2020, to the benefit of Eurozone. Precisely what was predicted is happening, and Theresa May lools more and more like Trump and Le Pen. It's best for those to be as disgraced as possible, and an economic depression in UK would serve her right.

It is a sad state of affairs, but we apparently need it

McHrozni

 

[Aepervius]

Silly of them. 60 billion is worrying and might put pressure on May. 100 billion just looks like unreasonable bullying that could rally Brits behind her. The EU are playing with nationalistic fire.

I doubt it , most folk don't grasp at the difference between 60 or 100 billion. The campaign of seeing the 60 billion as ridiculous has already been going on, you won't make the people "more" angry.

Anyway it does not matter if people rally behind May : what counts is : is the sum correct and legally binding ? Then it won't matter whether the UK folk rally to the last man & woman behind May.

 

[Aber]

Anyway it does not matter if people rally behind May : what counts is : is the sum correct and legally binding ? Then it won't matter whether the UK folk rally to the last man & woman behind May.

It's probably not legally binding, unless part of an exit agreement.

Lawyers views differ, but the House of Lords published a paper saying it was not. Perhaps more importantly in the dinner party discussion, the EU side didn't oppose the claim that it was not.

As to the sum, the EU is now throwing everything in, including some solid gold kitchen sinks.

 

[baron]

I doubt it , most folk don't grasp at the difference between 60 or 100 billion. The campaign of seeing the 60 billion as ridiculous has already been going on, you won't make the people "more" angry.

Anyway it does not matter if people rally behind May : what counts is : is the sum correct and legally binding ? Then it won't matter whether the UK folk rally to the last man & woman behind May.

It won't be legally binding because there's no legal mechanism that could enforce it. The only criterion is whether it's justifiable, and it's pretty clear that 100 billion is a figure plucked out of the air and has no justification behind it.

 

[Degeneve]

It won't be legally binding because there's no legal mechanism that could enforce it. The only criterion is whether it's justifiable, and it's pretty clear that 100 billion is a figure plucked out of the air and has no justification behind it.

So signing international treaties is not legally binding?

As a matter of fact the UK governement could decide not pay, whatever the final amount, but this would also mean the end of negotiations according to Article 50. With the total loss of free access to the EU market under the current conditions.

Could then the UE implement special customs tariffs for the import of UK goods in order to recover these 60 (or 100) billion?

 

[The Don]

Could then the UE implement special customs tariffs for the import of UK goods in order to recover these 60 (or 100) billion?

If they do then the costs will fall to the EU consumer rather than the UK exporter.