15 December 2017
Alasdair Smith is an Emeritus Professor of Economics at the University of Sussex, and is a member of the UK Trade Policy Observatory.
The deal done on Friday December 8 in the Brexit negotiations has already been subject to conflicting interpretations. The UK has committed to having no hard border in Ireland, and committed in terms which seem to admit no rowing back. (more…)
Charlotte Humma December 15th, 2017
Posted In: UK- EU
Tags: alignment, Article 50, Customs Union, Free Trade Agreement, Ireland, Irish border, Single Market, trade negotiations, Transition
8 December 2017
Jim Rollo is Deputy Director of UKTPO, Emeritus Professor of European Economics at the University of Sussex and Associate Fellow, Chatham House. Dr Peter Holmes Reader in Economics at the University of Sussex and Fellow of the UKTPO.
The agreement to proceed to the next phase of Brexit talks is a step forward on the road to a softer Brexit. But it does not offer a definitive solution to the status of the Irish border, which will depend on the nature of the final agreement on the UK-EU trade relationship. At best, it represents an exercise in constructive ambiguity designed to allow the shape and length of any interim agreement, which will help determine the shape of the long-term agreement and, in turn, will be the basis of any permanent solution to the status of the Irish land border with Northern Ireland. (more…)
Charlotte Humma December 8th, 2017
Posted In: UK- EU
Tags: Customs Union, Grandfathering, Irish border, Rules of Origin, trade
7 December 2017
Dr Emily Lydgate is a lecturer in Law at the University of Sussex and a fellow of the UK Trade Policy Observatory.
How can the UK uphold its commitment to leaving the EU Single Market and Customs Union while also preserving the invisible intra-Irish border? Leaving aside crucial questions of political feasibility, this post looks at some of the options and their trade and border implications. Notably, there are limits to ‘flexible and creative’ solutions that involve turning a blind eye to customs and regulatory checks solely on the intra-Irish border: trade rules leave little room for such ad hoc approaches. (more…)
Charlotte Humma December 7th, 2017
Posted In: UK- EU
Tags: border checks, Customs Union, Irish border, MFN, Northern Ireland, regulatory alignement, regulatory divergence, Single Market, tariffs, WTO
26 October 2017
Nicolo Tamberi is Research Assistant for the UKTPO and Charlotte Humma is the UKTPO’s business manager.
Leaving the Single Market and the Customs Union will require the implementation of new border controls between the UK and the EU that will surely increase transport time and therefore costs. However minimal they may be, these new procedures will negatively affect trade between the two parties.
According to a study by EY, Economic footprint of the Channel Tunnel fixed link, trade between Folkestone and Calais via the Eurotunnel was estimated to be £91.4 billion or 24.8% of trade with the EU in 2014. Goods transported through the Channel Tunnel are exported from and imported to every region of the UK.
Today, transporting things from one shore to the other requires minimal controls such as those that exist between Surrey and Somerset. Businesses on both sides of the channel increase their efficiency by integrating their supply chains and by relying on the prompt connection across the channel. So, what about Brexit? If one thing is clear in the impenetrable mist surrounding the future UK-EU relations, it is that exiting the Single Market and the Customs Union will require increased border controls. (more…)
Tina Perrett October 26th, 2017
Posted In: UK- EU
Tags: Brexit, Customs Union, Ernst & Young, Eurotunnel, Exports, food, FTA, Imports, logistics, manufacturing, Single Market, Trade agreements
11 October 2017
Dr Michael Gasiorek is Senior Lecturer in Economics at the University of Sussex and Director and Managing Director of InterAnalysis
Reading the Government’s White Paper on trade, and the Customs Bill on future customs arrangements, together with Monday’s statement from the Prime Minister seemed like a Groundhog day moment. In other words, this is somewhere we have been before – repeatedly. (more…)
Charlotte Humma October 11th, 2017
Posted In: UK- EU
Tags: Article 50, Brexit, Customs Bill, Customs Union, interim arrangements, No deal, trade, White Paper
26 September 2017,
L. Alan Winters CB, Professor of Economics and Director of UKTPO. Dr Peter Holmes Reader in Economics at the University of Sussex and Fellow of the UKTPO, Erika Szyszczak is a Professor of Law at the University of Sussex, independent ADR Mediator and a Fellow of the UKTPO.
Now it’s official. More than a year after the UKTPO said that it would be necessary (see Briefing Paper 2 and NIER paper), the Prime Minister has announced that the UK wants a transitional deal that preserves the status quo. Namely, membership of the Single market, a customs union with the EU, free mobility of labour, jurisdiction of the Court of Justice of the European Union (CJEU), budget payments and no external trade deals. Sad to say, this seems like progress.
Despite the language and some of the press commentary, Britain is not ‘opting for’, still less ‘agreeing to’, a transitional deal; it is asking for one in the negotiations. The Florence speech still uses the language of an ‘implementation period’. This implies that between now and 2019 the UK can both negotiate a final settlement to be implemented after the transition and the transition itself. But the Prime Minister has made no proposals about how to construct such a deal, other than that the UK leaves the EU on 29th March 2019, so that the transition requires agreement(s) between the EU (27 remaining members) and an independent UK. (more…)
Charlotte Humma September 26th, 2017
Posted In: UK- EU
Tags: Article 50, Brexit, CJEU, Customs Union, FTA, Negotiations, Single Market, Transition, WTO
21 August 2017
L. Alan Winters CB, Professor of Economics and Director of UKTPO.
Economists for Free Trade (EfFT) are back, offering the Introduction to an unpublished – and hence unknown – report that claims £135 billion benefits from Brexit. It not only repeats the previous claim that GDP will increase by 4% if the UK adopts free trade, which I characterised as ‘doubly misleading’ in April, but it adds in an extra 2% from ‘improved regulation’, 0.6% from our net budget contribution to the EU and 0.2% from removing the ‘subsidy to unskilled immigration’. It also promises faster growth as well.
I’ll come back to free trade, but, first, what regulations will be improved? We are not told. Similarly, what subsidy to immigration? Who knows? The budget contribution to the EU may be saved, but we will need to spend much of it on providing replacements for various EU regulatory bodies such as the European Medicines Agency, on negotiating new deals on things like airlines or nuclear isotopes, supporting farmers (which EfFT apparently accepts), on customs formalities on trade with the EU, on managing alleged unfair trade and on trade disputes, etc. Until we see the details, you have to doubt these numbers. (more…)
Charlotte Humma August 21st, 2017
Posted In: UK - Non EU, UK- EU
Tags: Brexit, Customs Union, Economics, Single Market, Standards, tariffs, trade, WTO
16 August 2017
Dr Peter Holmes Reader in Economics at the University of Sussex and Fellow of the UKTPO
The UK government has just issued its official position paper on the issue of the customs union and Brexit. It emphasises a desire for the “most frictionless trade possible in goods between the UK and the EU” and proposes two ways of achieving this in the long term, while making it clear that the UK will leave the EU’s customs union when it leaves the EU.
The first option it proposes is a “streamlined customs arrangement” which sounds like a form of free trade agreement (but there is no mention of this as an aim). It involves keeping in place a number of the existing customs arrangements and using (untested) electronic technology to ensure the smooth processing of all documentation. The stated aim is to keep border arrangements as close as possible to what they are now to maintain continuity for businesses. (more…)
Tina Perrett August 16th, 2017
Posted In: UK- EU
Tags: Brexit, Customs Union, Exports, Negotiations, politics, tariffs, Trade agreements
14 August 2017
After Brexit, the UK will have to leave the EU Customs Union (CU) and become a legally separate customs territory. It might then, however, seek to create a new Customs Union with the EU to cover their mutual trade.
The UK Trade Policy Observatory at the University of Sussex (UKTPO) has produced this short animated video that explains what this entails, and what kind of an agreement the UK and the EU would need to establish in order to achieve the same level of trade costs as we have now.
Ultimately, the video explains, a Customs Union will not produce ‘frictionless’ trade without re-creating several aspects of current EU membership. With Brexit negotiations already underway, it emphasises that maintaining a customs union is just one part of the story; and not, by itself, the be all and end all for achieving a smooth trading process.
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Tina Perrett August 14th, 2017
Posted In: UK- EU
Tags: Brexit, Customs Union, Europe, Negotiations, Single Market, tariffs, trade
23 June 2017
L. Alan Winters CB, Professor of Economics and Director of UKTPO and Ilona Serwicka, Research Fellow at UKTPO
One year ago the British people voted to leave the EU. Out of 33.5 million votes cast, 51.9 per cent were for ‘leave’, albeit in the absence of any statement about what ‘leaving’ might mean. The government is still vague about what the UK’s post-Brexit trade policy should be – even after triggering the formal leave process – but the general election has pressured Theresa May to soften her Brexit stance. Even though Brexit negotiations are now formally under way, the options suddenly again seem wide open for debate.
In terms of options the UK is back at square one, but following a year’s analysis, it is now clearer what these options amount to. Over the year, the UK Trade Policy Observatory (UKTPO) has discussed many of the options and this note draws on some of that analysis to try to light the path forward. (more…)
Charlotte Humma June 23rd, 2017
Posted In: UK - Non EU, UK- EU
Tags: Brexit, Customs Union, diplomatic complexities, FTA, Regions, sequencing, Single Market, WTO
