David Palethorpe

The views, thoughts and opinions of an insignificant speck in the Universe 😀

Hard Brexit – Economic Suicide?

What does the following mean or more to the point what – when you have deciphered it do they have – if anything in common?

CETA-NAFTA-EFTA- MERCOSURE-SADC-ASEAN-COMESA-EAC-EU.

No idea?

Well you are not alone because I suspect that the devout Conservative Tory Brexiteers and those who have been tasked and trusted by Theresa May to negotiate the UK exit from the European Union also don’t know.

To put you out of your misery this is what they stand for,

CETA – Trade Deal between Canada and Europe

NAFTA – North American Free Trade Agreement 

EFTA – European Free Trade Association

MERCOSURE – South America Trade Agreement

SADC – The Southern African Development Community

ASEAN – Association of Southeast Asian Nations

COMESA – The Common Market for Eastern and Southern Africa

EAC – East African Community

EU – European Union

and the thing they have in common is that they are all organisations and agreements that countries in different parts of the world have voluntarily entered into to make trade between them easier and more equitable.

It also means that collectively they have more of an economic bargaining position in the world.

Which brings us to the question of how many countries as there on the planet and how many have entered into trade and development agreements within their region.

If as I do you count Taiwan as an independent country in its own right there are 195 sovereign nations and another 60 what are called dependent areas of which 78 are currently members of a major trade organisation all of which are expanding.

What is interesting is that two of the nations who aren’t members of a trade organisation are China and India who between them have over 40% of the world’s population.

China arguably is or perhaps if not now is definitely on the way to taking over from the EU and USA as the leading economic trading nation in the world with India rapidly catching up with them.

What all of the countries also have in common is an understanding that the transportation of goods around the planet is reliant on cooperation between them and the need to reduce tariffs and costs.

China of all nations has worked this out as indicated by the train that arrives in the very salubrious London Borough of Barking every week carrying millions of pounds of goods.

At the very least you have to accept that it is innovative especially with the rising cost of aviation fuel and is quicker – even if it does take two weeks – than transporting goods by sea.

It is in fact so successful that China now send exports by rail to over twenty cities throughout the European Union.

What you may ask has this to do with the other existing trading blocks.

Directly perhaps nothing, but what it clearly demonstrates is the development of the integration of trade agreements across the world and the fact that even Communist China is increasingly showing its commitment to the reality of free trade between nations.

It is something that those in the Conservative party who are determined on negotiating a hard Brexit don’t appear to understand and is even more of an issue with the nonsensical “no deal is better than a bad deal” mantra.

How can they even be thinking of there being a “No deal” when in reality free trade between nations without quotas, tariffs and other trade restrictions is something the United Kingdom needs now more than ever.

How can the Brexiteers ignore the fact that according to the World Trade Organisation in 2014 the European Union, of who the UK is a member was the leading world trading block accounting for 14.9% of what was then worth $20 trillion.

Closely followed by the China – 14.3% and USA – 13.4%.

The question is why an earth do the Brexiteers want to leave what is one of the most powerful trading blocks in the world and effectively support the Donald Trump view of world trade and adopt a protectionist approach.

They of course deny this and say that membership of the European Union is holding the United Kingdom back from taking the opportunities offered by the global economy and that by leaving the EU we will be able to take back control and prevent a loss of jobs to other lower wage countries.

The fact is the country is being conned because as anyone who has lived as I have in a period from just after the Second World War to the present can tell you jobs have increasingly been lost to automation and the loss of manufacturing for the last 60 years.

And not only in the United Kingdom.

Which is why the number of world wide regional groupings working together to implement trade agreements now exceeds almost 300 which makes it even more inexplicable that just as nations are building trading blocks the UK is out of choice voluntarily turning its back on the biggest in the world.

David Davies, Liam Fox and Boris Johnston insist that by leaving the European Union they will be free to make even better free trade deals aound the world and especially with the countries of the Commonwealth.

The problem is the other regions of the world and globalised businesses have already organised themselves so why would they trade with the United Kingdom on better terms than those of their existing members?

What the Brexiteers won’t admit is that even when free from the European Union the United Kingdom will itself need to develop and implement its own defence against globalisation and trade defences against imports.

Isn’t it strange that the UK as one of the strongest and most vocal advocates of free trade and opponents of anti-dumping has now decided to give up access to the EU free market meaning they’ll now have to implement their own anti dumping policies.

As for the Commonwealth coming to the aid of the ‘Mother Country’ why would they?

There are 52 nations in the Commonwealth over three quarters of who are already members of a regional trading block and in some cases a member of more than one block.

Commonwealth countries already have deeply established trade agreements not only within the block of which they are members but also as members with other regional trading blocks.

They are trade agreements that have taken a long time to complete through protracted discussion and negotiation.

The United Kingdom will have to go through a similar protracted and lengthy comprehensive negotiating period to reach trade agreements on the scale needed to replace the one they have as a member of the European Union.

The U.K. economy depends and can only succeed in a world where there is open and free trade, or at the very least a minimum of tariffs and trade interference.

We are being told that all of this is not going to be an issue by Theresa May and her devoted followers.

Throughout the current General Election campaign the Conservatives have assured us they have a 100 page negotiating document ready to ensure that the UK gets a great Brexit deal.

And if they don’t they’ll just walk away with no deal at all.

Theresa May and her “Strong and Stable” mantra may convince those dye in the wool right wing Brexiteers Conservatives at home but it will have no credibility at all with the world trading nations.

What they refuse to admit either out of ignorance or wilful deceit is that their Brexit strategy will have a devastating impact on the UK economy amounting to what is the Conservatives leading the country into Brexit Economic Suicide.

It could of course all be different depending on how people vote on June 8th with the Conservatives removed from office and a more sensible approach to the Brexit negotiations being adopted by the new Government.

Friday 9th June 2017 may be the day the UK finally decides to take the leap into the unknown and commit Economic Suicide or Step Back and return once again to being a member of those who believe in free world trade.

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This entry was posted on June 4, 2017 by in Opinion Ramblings.

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