Brexit negotiations thread

[callan]

Can't read the link here, but AND THIS IS IMPORTANT, as part of the EU we are part of 52 existing trade deals. Deals with Japan and Vietnam are likely to be signed before we leave.

Whilst it is given that we wont be part of those 52 deals when we leave and will need to negotiate a lot of new deals just to get to a point of parity of where we are, questions do remain for the likes of Rees-Mogg who blabber one about having the freedom to negotiate trade with who we like.

Who exactly do we want a free deal with that we don't already have? And if we don't already have one, why not?

I wouldn't be too sure that a deal between Japan and the EU will be signed any time soon as they are miles apart on who arbitrates on dispute.

In terms of Trade deals per se they are generally built (as you will know) to facilitate ease of condition allowing both parties involved to focus unhindered on their specialities....in the case of Japan / EU talks, this will be cars vs food.

There is nothing to stop the UK and 3rd parties adopting the trade deals already in place by mutual consent....whether you want to have all 52 is open to debate... as a substantial amount of EU deals are with micro economies that the UK has very little trading history with....so other than a good relations point of view there may be little or no purpose.

As for your last question, you can answer that yourself....think of all the Japanese goods from Cars and motor bikes to play stations, Cameras ...News papers (FT is owned by Nikkei) all of which are purchased here in the UK without a trade deal.

 

[Lord Football]

I wouldn't be too sure that a deal between Japan and the EU will be signed any time soon as they are miles apart on who arbitrates on dispute.

In terms of Trade deals per se they are generally built (as you will know) to facilitate ease of condition allowing both parties involved to focus unhindered on their specialities....in the case of Japan / EU talks, this will be cars vs food.

There is nothing to stop the UK and 3rd parties adopting the trade deals already in place by mutual consent....whether you want to have all 52 is open to debate... as a substantial amount of EU deals are with micro economies that the UK has very little trading history with....so other than a good relations point of view there may be little or no purpose.

As for your last question, you can answer that yourself....think of all the Japanese goods from Cars and motor bikes to play stations, Cameras ...News papers (FT is owned by Nikkei) all of which are purchased here in the UK without a trade deal.

Vietnam will be signed possibly later this year. It is envisaged the Japanese one will conclude before we Brexit. But the delays do emphasise the problems that are going to exist when we go it alone. The Canadian one is still held up in the Canadian legislature..... completely out of the EU and UK's hand. Should have gone live 17 February, still isn't.

You are absolutely right. There is nothing to stop us adopting existing trade deals by mutual consent. The thing is of course, those deals were signed with the EU. So whereas Japan would be, in your example, cars v food the existing deals would include, things the UK does not produce or need and visa versa. So its not as simple as just doing what we currently do. There is going to be the need for trade missions to even scope and agreement. Then you need to negotiate it. Sitting where I know you sat, take a look at how long the PEM negotiations are taken.

And as you know, some signatories do not want to jeopardise EU trade by trading with us, some simply wont grasp the change in status (Korea for example) and some may not want to trade with us as we have nothing to offer.

And you mention micro economies. Not overly sure where you are coming from with that. We do have deals with blocs that may on paper seem insignificant. They're not insignificant if you are an importer of, say, Ecuadorian prawns and your business is predicated on the import costs. Then they're significant. And your prawn importer will be demanding that we continue work on the same tariff basis.

 

[callan]

Vietnam will be signed possibly later this year. It is envisaged the Japanese one will conclude before we Brexit. But the delays do emphasise the problems that are going to exist when we go it alone. The Canadian one is still held up in the Canadian legislature..... completely out of the EU and UK's hand. Should have gone live 17 February, still isn't.

You are absolutely right. There is nothing to stop us adopting existing trade deals by mutual consent. The thing is of course, those deals were signed with the EU. So whereas Japan would be, in your example, cars v food the existing deals would include, things the UK does not produce or need and visa versa. So its not as simple as just doing what we currently do. There is going to be the need for trade missions to even scope and agreement. Then you need to negotiate it. Sitting where I know you sat, take a look at how long the PEM negotiations are taken.

And as you know, some signatories do not want to jeopardise EU trade by trading with us, some simply wont grasp the change in status (Korea for example) and some may not want to trade with us as we have nothing to offer.

And you mention micro economies. Not overly sure where you are coming from with that. We do have deals with blocs that may on paper seem insignificant. They're not insignificant if you are an importer of, say, Ecuadorian prawns and your business is predicated on the import costs. Then they're significant. And your prawn importer will be demanding that we continue work on the same tariff basis.

Absolutely agree with your comments regarding scope, as any EU deals would or at least should have been far ranging to encompass the strengths of services and manufacturing over its full membership....rather than zeroed in....and there would be little point in the UK taking on agreements such as sawn timber etc...however is there a rationale behind your thinking that they can't or shouldn't be there?

PEM, I wouldn't actually fault the EU on to be honest, this is more (in my opinion) to do with certain contracted parties baulking at modernization.

Korea I'm not so sure is a terrific example of not 'grasping the concept'....as they were at the fore front commercially when the borders truly opened up and used an intermediary ( Ernst + Young), to educate on the changes across both Government and industry lines...there was as I recall some issues regarding the old CRN system which implicated on some UK exports but can't recall (I worked for their Government between 89-96) any major issues.

My comments regarding the smaller economic countries were more aimed at value and economy of scale....clearly there will be individual cases where things may change, however turn the argument on its head and look at it from the point of view of a strawberry importer who purchases from China yet enjoys no duty benefit for doing so....or a Prawn importer who purchases from the Bay of Bengal.

 

[Lord Football]

Absolutely agree with your comments regarding scope, as any EU deals would or at least should have been far ranging to encompass the strengths of services and manufacturing over its full membership....rather than zeroed in....and there would be little point in the UK taking on agreements such as sawn timber etc...however is there a rationale behind your thinking that they can't or shouldn't be there?

PEM, I wouldn't actually fault the EU on to be honest, this is more (in my opinion) to do with certain contracted parties baulking at modernization.

Korea I'm not so sure is a terrific example of not 'grasping the concept'....as they were at the fore front commercially when the borders truly opened up and used an intermediary ( Ernst + Young), to educate on the changes across both Government and industry lines...there was as I recall some issues regarding the old CRN system which implicated on some UK exports but can't recall (I worked for their Government between 89-96) any major issues.

My comments regarding the smaller economic countries were more aimed at value and economy of scale....clearly there will be individual cases where things may change, however turn the argument on its head and look at it from the point of view of a strawberry importer who purchases from China yet enjoys no duty benefit for doing so....or a Prawn importer who purchases from the Bay of Bengal.

I think what we are both saying, in a language non international trade nerds, is that international trade is very complex and difficult and not just a case of signing a piece of paper. Its also (and this is the Korea point) related to different cultures, taxation rules and language limitations. May drop you a line about Korea.

We don't have a trade agreement with Ecuador. We have an agreement with a trading bloc that includes Ecuador. So we benefit from Ecuadorian prawns and an array of other goods from countries in that trade group. We probably, as a government, would want a deal with Ecuador only. The selling point is that they bring goods from Colombia (coffee), Chile, Peru etc into the frame.

China is an interesting example. The Chinese have little to no labour laws or regulations and almost unlimited resources. They under cut everyone. We don't want an agreement with them because they'd put our manufacturers or producers out of business swiftly. This is why we put ADD on a lot of their goods. Why would an importer import strawberries from China at 14% duty when they can import them from Brazil at 0%? We could of course grow our own strawberries, but all the people we employ to pick them wont be allowed to work here post Brexit and if they are, now feel unwelcome and wont come. But that's another argument.

Oh, and your prawn importer from the bay of Bengal gets the benefit of GSP+.

 

[callan]

I think what we are both saying, in a language non international trade nerds, is that international trade is very complex and difficult and not just a case of signing a piece of paper. Its also (and this is the Korea point) related to different cultures, taxation rules and language limitations. May drop you a line about Korea.

We don't have a trade agreement with Ecuador. We have an agreement with a trading bloc that includes Ecuador. So we benefit from Ecuadorian prawns and an array of other goods from countries in that trade group. We probably, as a government, would want a deal with Ecuador only. The selling point is that they bring goods from Colombia (coffee), Chile, Peru etc into the frame.

China is an interesting example. The Chinese have little to no labour laws or regulations and almost unlimited resources. They under cut everyone. We don't want an agreement with them because they'd put our manufacturers or producers out of business swiftly. This is why we put ADD on a lot of their goods. Why would an importer import strawberries from China at 14% duty when they can import them from Brazil at 0%? We could of course grow our own strawberries, but all the people we employ to pick them wont be allowed to work here post Brexit and if they are, now feel unwelcome and wont come. But that's another argument.

Oh, and your prawn importer from the bay of Bengal gets the benefit of GSP+.

Feel free to get in touch re Korea, as I expect it's cultural if anything that holds them back...particularly when it comes to loss of Face.

Whilst I would agree in broad terms of the cost impact purely from a duty point of view, have you considered Consumption, Seasonality, Reefer availability....especially where two way traffic is involved...freight costs...if you are an importer then you will be considering all of this rather than a particular cost in Isolation....when supply runs out on fruit from South America....generally towards the end of the year then importers will look elsewhere for their products.

So whilst my Prawn importer from the Bay of Bengal may get preference on duty....he also needs to compete on other related costs again all of the above applies....and again it is seasonal.

 

[Another Surrey Shrimper]

Is there anyone who voted Leave who is happy with the progress that has been made so far?

 

[callan]

Is there anyone who voted Leave who is happy with the progress that has been made so far?

I would suspect that depends on the motive for voting Leave...had the Remain vote prevailed would we have been any happier?

 

[Tangled up in Blue]

http://www.bbc.com/news/uk-politics-41106507

Not looking good.

 

[callan]

http://www.bbc.com/news/uk-politics-41106507

Not looking good.

No that picture of Blair about to snog Juncker is truly off putting.

 

[Another Surrey Shrimper]

I would suspect that depends on the motive for voting Leave...had the Remain vote prevailed would we have been any happier?

'I would suspect that depends on the motive for voting Leave...'

yes, that's why I left it as an open question - people may be happy or unhappy with the current situation depending on what they wanted the outcome to be. You voted Leave - are you happy with the progress so far?

'had the Remain vote prevailed would we have been any happier?'

I started to answer this, but probably better for it to be held back or the original question will get buried (I know how this place works!)

 

[Benfleet A1]

'I would suspect that depends on the motive for voting Leave...'

yes, that's why I left it as an open question - people may be happy or unhappy with the current situation depending on what they wanted the outcome to be. You voted Leave - are you happy with the progress so far?

'had the Remain vote prevailed would we have been any happier?'

I started to answer this, but probably better for it to be held back or the original question will get buried (I know how this place works!)

You old cynic you.

 

[callan]

'I would suspect that depends on the motive for voting Leave...'

yes, that's why I left it as an open question - people may be happy or unhappy with the current situation depending on what they wanted the outcome to be. You voted Leave - are you happy with the progress so far?

'had the Remain vote prevailed would we have been any happier?'

I started to answer this, but probably better for it to be held back or the original question will get buried (I know how this place works!)

A short reply would be yes....if at this point of the negotiations Barnier and all were telling us how happy they were I would be more concerned.

 

[Lord Football]

Feel free to get in touch re Korea, as I expect it's cultural if anything that holds them back...particularly when it comes to loss of Face.

Whilst I would agree in broad terms of the cost impact purely from a duty point of view, have you considered Consumption, Seasonality, Reefer availability....especially where two way traffic is involved...freight costs...if you are an importer then you will be considering all of this rather than a particular cost in Isolation....when supply runs out on fruit from South America....generally towards the end of the year then importers will look elsewhere for their products.

So whilst my Prawn importer from the Bay of Bengal may get preference on duty....he also needs to compete on other related costs again all of the above applies....and again it is seasonal.

You just answered my Korean question. Nice one.

You, as usual, make good points on some aspects of international trade. Freight costs is a really dozy, which is why I remain staggered that elements within the Government think that not having a deal with your closest neighbours is a good thing.

 

[callan]

You just answered my Korean question. Nice one.

You, as usual, make good points on some aspects of international trade. Freight costs is a really dozy, which is why I remain staggered that elements within the Government think that not having a deal with your closest neighbours is a good thing.

No problem, have sent you a PM which hopefully explains a bit more with regard the Chaebol.

Freight costs have and always will be at the mercy of supply and demand, and with the EU's determination to end the Liner conference system rather than concentrating on breaking the way bunkers are averaged, and caf set etc then it was only ever going to be a complete mess.

Certainly if ever an industry needed reform it was shipping but the way the EU went about it made no sense whatsoever.

 

[Lord Football]

No problem, have sent you a PM which hopefully explains a bit more with regard the Chaebol.

Freight costs have and always will be at the mercy of supply and demand, and with the EU's determination to end the Liner conference system rather than concentrating on breaking the way bunkers are averaged, and caf set etc then it was only ever going to be a complete mess.

Certainly if ever an industry needed reform it was shipping but the way the EU went about it made no sense whatsoever.

I'll defer to you on that one. You out nerded me there. Lol

I don't get involved with shipping or freight. Not my bag at all.

 

[Bielzibubz]

Is there anyone who voted Leave who is happy with the progress that has been made so far?

Yes.

Nothing to see here. Move along please.

 

[Bielzibubz]

An observational note on this thread.

Callan & Lord Football - Very interesting reading from two people who clearly understand the complexities of Brexit, international trade deals and the negotiations and I thank them both for their contributions. Keeping it real.

*** - Keeps it calm and rational in spite of baiting. Respect (even though I disagree with almost everything he writes)

TUIB/Barna - Can't debate a topic or offer an opinion of his own without a BBC or Guardian link. Waste of time.

All others - Occasional nuggets of goodness and rational thought that I enjoy reading.

My tip of the day. DON'T believe all you read in the papers and see on the news. Look beyond the hype and biased media reporting :winking:

 

[Benfleet A1]

An observational note on this thread.

Callan & Lord Football - Very interesting reading from two people who clearly understand the complexities of Brexit, international trade deals and the negotiations and I thank them both for their contributions. Keeping it real.

*** - Keeps it calm and rational in spite of baiting. Respect (even though I disagree with almost everything he writes)

TUIB/Barna - Can't debate a topic or offer an opinion of his own without a BBC or Guardian link. Waste of time.

All others - Occasional nuggets of goodness and rational thought that I enjoy reading.

My tip of the day. DON'T believe all you read in the papers and see on the news. Look beyond the hype and biased media reporting :winking:

Tell me where to look please because all I see is one big cluster****.

 

[Shrimpers are Magic]

Is there anyone who voted Leave who is happy with the progress that has been made so far?

I've no idea what if any progress has been made and I'm not in the least bit surprised or concerned.
We were promised a bumpy ride and it looks like we're going to get one - I'll continue to hold my nerve for the foreseeable and not demand a re-think every two minutes.

 

[Bielzibubz]

Tell me where to look please because all I see is one big cluster****.

To be fair the thread started out as a worthwhile read but these last three or four months or so it's just become one big bore fest by the same old SZ members posting link after link of cherry picked articles in what I can only assume is some misguided notion that what they post will in some way make some come round to their way of thinking.

And to elaborate on my reply to ***. What is happening now with regards to the negotiations it is no more or no less than I expected. It's going to a long and for some a painful ride but ultimately one which will benefit the nation. And if it stops Barna moving back to the UK then that's an added bonus :smile: