1 April 2019
Dr Ingo Borchert is Senior Lecturer in Economics and Julia Magntorn Garrett is a Research Officer in Economics at the University of Sussex. Both are fellows of the UK Trade Policy Observatory.
During the first round of the indicative voting process at Parliament, the motion that proposes a permanent customs union attracted the second highest number of Ayes and was rejected by the slimmest margin of all eight motions. This result shows the prevailing preoccupation with trade in merchandise goods. Amongst other things, a customs union alone does nothing for services trade. In this blog, we set out why the continued neglect of services trade is a major concern for the UK economy.[1] A twin-jet aircraft with just one engine on would ordinarily be bound for an emergency landing rather than for a smooth journey ahead. (more…)
Charlotte Humma April 1st, 2019
Posted In: UK - Non EU, UK- EU
Tags: Customs Union, Exports, Services, Single Market
29 March 2019
Nicolo Tamberi is Research Assistant in Economics for the UK Trade Policy Observatory and L. Alan Winters CB is Professor of Economics and Director of the Observatory.
The eight EU Trade Agreements that the UK has rolled-over replicate current trading conditions with their respective partners to a substantial extent. However, conditions could still deteriorate for at least two reasons:
Charlotte Humma March 29th, 2019
Posted In: UK - Non EU, UK- EU
Tags: continuity bilateral trade agreements, Grandfathering, mutual recognition, rolling over, Rules of Origin, Trade agreements
14 March 2019
Dr Michael Gasiorek is a Senior Lecturer in Economics at the University of Sussex and Julia Magntorn Garrett is a Research Officer in Economics at the University of Sussex. Both are fellows of the UK Trade Policy Observatory. L. Alan Winters CB is Professor of Economics and Director of the UK Trade Policy Observatory.
Key points:
Following the first defeat of the Withdrawal Bill in Parliament, and prior to yesterday’s vote on a ‘No Deal’ alternative, the Government published the temporary tariff schedule it proposes to apply in the event of a no deal. As with most things Brexit, this is complicated to unpick, especially as some of the listed items are simply asterisked, and the details on these need to be found in another (1400 page) document! (more…)
Charlotte Humma March 14th, 2019
Posted In: UK - Non EU, UK- EU
Tags: agriculture, consumer prices, EU, Imports, MFN, tariffs, Trade agreements
13 March 2019
L. Alan Winters CB is Professor of Economics and Director of the UK Trade Policy Observatory.
With Mrs May’s deal again defeated in the House of Commons yesterday evening, Professor L. Alan Winters asks how the UK got to be within 16 days of leaving the EU with no agreed plan for its departure or future relationship with the EU.
In the video ‘Mrs May’s Impasse’ Professor Winters explains how incompatible economic and political agendas and ill-considered red-lines led to the current impasse on Brexit and argues that one or the other has to give if the UK is to avoid ‘No Deal’.
Charlotte Humma March 13th, 2019
Posted In: UK- EU
12 March 2019
Julia Magntorn Garrett is a Research Officer in Economics at the University of Sussex and a fellow of the UK Trade Policy Observatory and L. Alan Winters CB is Professor of Economics and Director of the UK Trade Policy Observatory.
Tariffs are the simplest and most direct of the tools of trade policy: they are taxes on imports. Broadly speaking, high tariffs help to shelter domestic industries from international competition, whereas lower tariffs increase competition and benefit consumers through both lower prices and permitting a wider variety of products to choose from. Despite saying that taking back control of its trade policy is imperative and that the UK may have its own trade policy in under three weeks (30th March), the Government has yet to reveal its policy for UK tariffs. The Financial Times recently reported that the plan was to eliminate the majority of industrial tariffs and, in the same vein, Sky News reported on the Government’s intention to cut 80-90% of all tariffs to zero. Many business owners are anxiously awaiting further information, as they may have only a matter of weeks to adjust to changes that could seriously affect their business. (more…)
Charlotte Humma March 12th, 2019
Posted In: UK- EU
Tags: MFN, Protectionism, tariffs
11 March 2019
Dr Emily Lydgate is a lecturer in Law at the University of Sussex and a fellow of the UK Trade Policy Observatory.
On Tuesday Theresa May will again bring before Parliament the EU deal for which she suffered a defeat of 230 votes – the worst ever. Whilst the scale of the defeat suggests that the deal is an affront to the will of MPs, the rejected Withdrawal Agreement, with its Northern Irish ‘backstop’, accomplished two things that many support – or at least are moving toward by default. The first is a trade agreement that respects the outcome of the Referendum yet provides a measure of frictionless trade. The second is to avoid leaving the EU with no deal.
Charlotte Humma March 11th, 2019
Posted In: UK- EU
27 February 2019
Ilona Serwicka is Research Fellow in the economics of Brexit and Peter Holmes is a Reader in Economics at the University of Sussex. Both are Fellows of the UK Trade Policy Observatory.
There are proposals to relax customs rules and duties in specially-designated areas known as free ports or more generally free zones. But these would make little impact on rebuilding the UK economy after Brexit, reveal Dr Serwicka and Dr Holmes in our latest Briefing Paper ‘What is the extra mileage in the reintroduction of ‘free zones’ in the UK?’ (more…)
Charlotte Humma February 27th, 2019
Posted In: UK - Non EU, UK- EU
Tags: Customs, free ports, free zones, Jobs
19 February 2019
Ilona Serwicka, Research Fellow in the economics of Brexit at the UK Trade Policy Observatory and Nicolo Tamberi, Research Assistant in Economics for the Observatory.
Earlier this month, Japanese car manufacturer, Nissan made an unexpected U-turn and announced that it was no longer planning to manufacture its new X-Trail SUV model at the Sunderland plant. In a statement, Nissan said that:
‘while we have taken this decision for business reasons, the continued uncertainty around the UK’s future relationship with the EU is not helping companies like ours to plan for the future’.[1]
Yesterday, another Japanese car manufacturer, Honda, said that it was going to close its Swindon plant in 2021, and consolidate its production operations in Japan – a move that is going to put some 3,500 jobs at risk, with more jobs threatened in the supply chain. Early speculation suggests that tariff-free access to the EU is among the factors behind the company’s decision.[2]
Although neither Nissan nor Honda explicitly blamed Brexit for a decision to scale down their operations in the UK, Brexit provides the context for the decisions and for the steps that can be taken to cope with them. (more…)
Charlotte Humma February 19th, 2019
Posted In: UK - Non EU, UK- EU
Tags: Car Industry, FDI, foreign investment, honda, Nissan
13 February 2019
Dr Michael Gasiorek is a Senior Lecturer in Economics at the University of Sussex and a fellow of the UK Trade Policy Observatory.
Currently, there is much focus on the politics of getting some version of the Withdrawal Agreement through Parliament. This requires a political resolution to the inclusion of the ‘backstop’ in the Withdrawal Agreement. The strategy appears to be to come up with “alternative arrangements” which will be acceptable to the UK Parliament and to which the EU can agree. A spoonful of sugar might help the medicine go down.
However, even if this can be achieved the fundamental issue will not have been resolved. (more…)
Charlotte Humma February 13th, 2019
Posted In: UK- EU
12 February 2019
Dr Michael Gasiorek is a Senior Lecturer in Economics and Julia Magntorn Garrett is a Research Officer in Economics at the University of Sussex. Both are fellows of the UK Trade Policy Observatory.
As a member of the EU, the UK is party to around 40 Free Trade Agreements (FTAs) with more than 70 countries. Over the last two years or so, the Government has stated that it intends to roll over, or more formally, ‘replicate’ these agreements. Indeed, in 2017 Liam Fox claimed that ”we’ll have up to 40 ready for one second after midnight in March 2019”. However, in recent weeks it has become clear that this is not going to happen,[1] and that at best there will only be a very small number of agreements replicated.[2] In this blog, we give some summary statistics outlining why this matters economically and which sectors are most vulnerable. We also discuss why, practically, very few agreements can be replicated by the current withdrawal date.
Charlotte Humma February 12th, 2019
Posted In: UK- EU
Tags: Dr Fox, Free Trade Agreement, FTA, Grandfathering, roll over, Trade agreements
