@ Ramone. Trying to work out the financial pros/cons of the EU.
We pay in into EU funds more that we get out. Yep, about £250m per week.
fullfact.org/europe/350-million … ty-misuse/
When we leave we gain that £250m…almost, but we wont quibble about details and payments, let
s say all of that stays here.
About £13b annually.
So whats on the other side of the equation? Because it
s in the future and nothing has been agreed it is speculative, nowt we can do about that. The Leave campaign is based on one possible future, so is the Remain idea. We can`t avoid being speculative.
As members of the EU we have frictionless cross border trade and free movement of people. All countries within the EU are on a leveling playing field. I dont say we are all level straight away, but we are getting nearer financially. Free movement of goods within the EU means trade is cheaper "to do" because of there being no taxes and tariffs, and no (or little) border controls. Because it is easier and cheaper and quicker (so cheaper again) to trade within the zone that is where our biggest markets are. Being geographical neighbours is a huge factor too. If we had a hard Brexit, on WTO rules there would be taxes on what the EU imports. So any goods we sell to them is dearer to them. If the price of UK widgets increases, and Spanish widgets stays the same? Maybe the French and Germans will buy Spanish in the future. If UK widgets may involve more paperwork and be delayed at borders that
s even more reason to change supplier.
Can we put a number on that?
Our exports to the EU in 2017 was £274b. annually.
If we were to loose just 5% of our current trade we would be loosing out. (about £700,000 by my arithmetic) Any more lost clients and wed be very major losers. Even as MFN (most favoured Nation) status our UK produced cars would have a 10% tariff on them. Maybe we loose much more than 5% of trade? Given the trading disadvantage we would have for investors compared with other EU countries new factories would be built elsewhere: the next Japanese car plant will go where are frictionless borders with the largest market and no tariffs. EU needs no more than one car plant for each maker (maybe none) but if JPN.Co needs one plant in Europe will they build it in the UK so 90% of it
s goods have tariffs, or in the EU so only the 10% sold in the UK has tax on it? That seems obvious. The only way we could attract new factories would be a supply of cheap labour. What the Tory Brexiteers call being competitive! Being able to drop wages. The country as a whole may do well, and a small number of investors would do well, but only at the expanse of a big slice of the population being worse off.
And be clear investment in big factories to make widgets or cars and employ people needs multinational investment. We cant gamble on a new start coming along, and making an impact. What of new markets? What of new deals? Brexiteers promised much....almost none of those promises held water. And why would they? The EU is a huge market, and it
s on our doorstep. A new trade deal, with say New Zealand, would be nice, but there are over 500million people in the EU and less than 50m in NZ. Any trade in goods will be slower, cost more in transport etc, it seems plain to me that its a folly to equate the two in any way. Exports to NZ were about £520m. If we guess a 5% loss in EU trade, that
s £13,000m. loss. Wed need to double (100% increase) our trade with NZ and with 26 other similar deals, just to stand still on exports! It ain
t gonna happen.
The figure simply don`t stack up.
UK imports under WTO rules need to treat all WTO members equally. If we choose not put tariffs on imported EU foodstuffs, (we don`t want dearer food) we need to treat other countries the same.
So, we have to pay more for EU food? Not good.
Or our farmers will need to compete with much cheaper foods from Africa, Mexico, and the US. A collapse of UK agriculture. Not good.
We don`t live in an isolated society. We need international trade and any extra paperwork cost us more. Tariffs and taxes mean our products cost more so we loose trade, income, and jobs. In transport we all know that time is money, and eventually the consumer pays. More border regulation means we pay more for almost everything.
Overall we are, I reckon, better off in than out. By a lot.
fullfact.org/europe/uk-eu-trade/