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.
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
5 March 2019
Ilona Serwicka is Research Fellow in the economics of Brexit at the UK Trade Policy Observatory.
Last week, the United States published a document that set out their negotiating objectives for a trade agreement with the UK, shortly after the publication of virtually identical documents for negotiating with the EU and with Japan. Those in the UK who expected ‘special treatment’ from the US are in for a disappointment, but not a surprise (as UKTPO researchers pointed out in October 2016). In negotiating with major trading partners after Brexit, the UK is likely to be a price taker because of a power imbalance. (more…)
Charlotte Humma March 5th, 2019
Posted In: UK - Non 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
25 February 2019
Julia Magntorn Garrett is a Research Officer in Economics at the University of Sussex and a fellow of the UK Trade Policy Observatory.
Two weeks ago, the UKTPO called for further transparency on the Government’s current progress on replicating the existing agreements between the EU and third countries. On Thursday last week, Secretary of State for International Trade, Liam Fox MP made a public announcement confirming that little had changed since he gave evidence to the International Trade Select Committee on the 6 February and that the progress has been minimal. So far, only six out of the 40 existing trade agreements have been signed, covering a total of 9 countries; Chile, Faroe Islands, Switzerland, Israel, Palestinian Authority, Madagascar, Mauritius, Seychelles and Zimbabwe. One further agreement is close to being finalised, adding another 2 countries (Fiji and Papua New Guinea) to the list. This still leaves about 60 Free Trade Agreement (FTA) countries without continuity agreements.
Dr Fox also announced that some agreements will definitely not be in place for exit day, those with Andorra, Japan, Turkey, and San Marino. The agreement with Algeria is also unlikely to be ready. When it comes to numbers, the announcement is thin on details. The Department for International Trade states that the EU-FTA agreements account for 11% of the UK’s trade, a figure that seems low to start with. No further information is provided as to how important the signed countries are to the UK’s trade, or how much of the UK’s trade with the rest of the FTA group is still at risk if we have a hard Brexit in about a month’s time. This blog aims to fill some of these gaps. (more…)
Charlotte Humma February 25th, 2019
Posted In: UK - Non EU
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’.
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.
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
14 February 2019
L. Alan Winters CB, Professor of Economics and Director of the UK Trade Policy Observatory.
Charlotte Humma February 14th, 2019
Posted In: UK - Non EU
30 November 2018
L. Alan Winters CB, Professor of Economics and Director of the UK Trade Policy Observatory, Dr Michael Gasiorek, a Senior Lecturer in Economics at the University of Sussex and Peter Holmes, Reader in Economics at the University of Sussex both fellows of the UK Trade Policy Observatory.
On Tuesday, the UK Government released a set of cross-Departmental estimates of the possible economic costs of different Brexit options. They were based on the Government’s own modelling, which uses a technique known as a Computable General Equilibrium modelling and is based on the Global Trade Analysis Project (GTAP) consortium’s world model and dataset. The aim is to model (very approximately) the important linkages in an economy over a medium to long-term horizon and to assess the possible impact of changes in trade policy on the economy. (Short-term modelling, over a five year period, was simultaneously released by the Bank of England, but we do not discuss it here). The modelling approach is relatively standard, has been applied competently and honestly and produces results fairly much in line with other studies of the impact of Brexit.
This blog highlights some of the trade-related aspects of the modelling exercise and its results. As with all modelling, the main issues concern the assumptions that users input into the model rather than the model itself. (more…)
Charlotte Humma November 30th, 2018
7 November 2018
As the fifth meeting of the U.S. and U.K. Trade and Investment Working Group takes place this week in Washington, hope for an eventual U.S.-U.K. trade deal is on the rise, thanks to the White House’s recent notification to Congress of its intent to launch formal negotiations. This new optimism is astonishing in light of Trump’s protectionist moves of the past year and raises questions about the direction of U.S. trade policy more generally. Should Trump’s free trade overtures be taken seriously? Do they represent a change in strategy or even a change in tactics? How ambitious should we expect a U.S.-U.K. trade deal to be? To answer these questions, it is helpful to understand Trump’s motivations and the policy environment in which his policies are being developed. Such is the goal of this essay. (more…)
Charlotte Humma November 7th, 2018
Posted In: UK - Non EU
31 October 2018
Ilona Serwicka, Research Fellow in the economics of Brexit at the UKTPO and Nicolo Tamberi, Research Assistant in Economics for the Observatory.
Our latest research finds that overseas investment to the UK may be some 19 per cent lower because of the vote to leave the EU. Despite a buoyant 12 months for the world economy in 2017, inflows of Foreign Direct Investment (FDI) to the UK have continued to decline since reaching a peak in 2015. (more…)
Charlotte Humma November 1st, 2018
L. Alan Winters CB is Professor of Economics and Director of the Observatory and Julia Magntorn is Research Officer in Economics at the UKTPO.
There is much to digest in the White Paper on The future relationship between the United Kingdom and the European Union and much to clarify. This blog is devoted entirely to trying to understand the Facilitated Customs Arrangement (FCA) that aims to deliver frictionless trade in goods between the UK and the EU after Brexit.
The FCA matters because trade that is ‘as frictionless as possible’ with the EU is now accepted by nearly everyone as desirable and has been characterised by much of business as essential. It also matters in the short term, however, because it is the UK government’s offer to the EU on how to ensure that there is no border between Northern Ireland and the Republic. Without a solution to this latter problem there will be no Withdrawal Agreement and no transition. (more…)
Charlotte Humma July 23rd, 2018
Posted In: UK - Non EU