The now-enacted will of (some of) the people

[ml1dch]

It's a very old article (Dec '16), but given the nutters are back on their "WTO rules are fine" wagon, it's worth repeating what that means. As none of them seem to know.

It's quite long, and all about tariffs. But worth sticking with:

Tariff rate quotas are a nightmare. They are the one part of the WTO arrangement that Britain can't replicate, or seek to join, or copy and paste into existence. They require very careful calculations. These calculations are so careful, and so complex, that the EU hasn't established new legally certified schedules since the period in which it only had 15 members. The updated quotas are kept under wraps because they haven't been able to agree them properly.

But Britain has to produce tariff rate quotas by the time it leaves the EU. If it leaves the single market and the customs unions without a proposed trade deal (hard Brexit) the problem becomes even more complex, because you have to factor in UK-EU trade. But even if it doesn't, the tariffs for the rest of the world need sorting. This has to happen now.

The reason the tariffs are so complex is because they are a slice of the continental trade pie. Quotas are applied to imports to Europe, giving them a certain tariff level up to a certain amount and another tariff level at a further amount. So for lamb, say, 283,825 tonnes are duty free, while anything above that comes in for a standard tariff.

Now the UK needs to work out its share of that continental quota. How much of the lamb sent to Europe goes to the UK? This sounds a relatively simple question. Some have suggested you just take the last three years trade flow and use the average. Then we can just go to the WTO, put down that number and if people want to complain they can complain, but we'll trade in the meantime.

This is a gross simplification, as the careful, detailed work of Peter Ungphakorn, who spent two decades at the WTO secretariat, demonstrates. If you're into this sort of thing - and unfortunately we all now have to be - he's worth a follow on Twitter.

For a start, the trade flows are uneven, so taking the average of the last three years is a dodgy way of working it out. In 2013, Britain imported 13,422 tonnes of mutton and lamb from the EU. In 2014 it was 11,719. In 2015, it was 7,611. So sure, take the average, but that does not give a good assessment of what your trade flows are likely to be in future. And if you get those wrong you can open up your market to lots of cheap imports, hurting domestic industries - or block sufficient imports from coming in and deprive British consumers of the things they want to buy. You can be liberal or protectionist - it doesn't matter. If your official trade flows are out of kilter with your real trade flows, your policy is just a bunch of wobbly meaningless nonsense. 

But even if those trade flows averages were perfectly accurate, this is a dauntingly complicated task. You don't just need to work out the share of EU imports that go to the UK. You have to work it out for every exporting country. So for lamb the original WTO agreement - later updated by regulation - has 15 exporting countries, from Argentina to Slovenia, who have the quota allocated between them. Of them, New Zealand has the lion's share (this is lamb we're talking about, after all). It has 226,700 tonnes of a 283,825 overall quota.

The WTO is member led. The expectation is that individual countries sort things out between themselves if possible. This offers Britain a crucial opportunity. It means we can get to work on this now by having informal chats with the Kiwis and trying to smooth things out in advance of Brexit Day. Get a deal signed in pencil now and it'll be ready for rubber stamping by March 2019.

Except that arrangement with the Kiwis might irritate the other countries in that quota system. After all, there's a lot to play for. Britain is not some tiny country establishing itself on the world stage. It is, as the Brexiters keep telling us, a major consumer market and a primary cog in the international financial system. Lots of money is at stake here. Many domestic industries from pretty much every country on earth will be affected in some way. And while the media aren't too interested in this type of stuff, these industries will be watching very closely and lobbying their government heavily to get a good deal.

The Kiwis will suggest that the average of the last three year's trade flow doesn't fairly represent their exports to the UK and lobby for a better deal. We will presumably try to comply and keep them happy. After all, we are at a disadvantage. We want to be collegiate and useful. But then we have to play nice and accommodating with all the other countries in that list.

Argentina only exports 23,000 tonnes of lamb to the EU. But perhaps its domestic industry is growing and lobbying government hard. Or perhaps it enjoys disproportionate political influence at home. The fact a country has a modest export flow for a certain product does not mean it is politically unconcerned by changes to it.

And here's the rub: every country in the export quota list, regardless of its level of exports, can launch litigation against the UK if it does not approve of the quota we put down. It can send us one tonne or a million - its legal strength is the same. The potential for multiple trade disputes is vast. After all, this is not just about lamb. There are countless quotas, from meat of bovine animals, to citrus hybrids, to mushrooms, to countless varieties of cheese.

And these are complex. You've got quota rates for whole Cheddar cheeses "of the conventional flat cylindrical shape of a net weight of not less than 33kg but not more than 44kg and cheeses of the conventional flat cylindrical shape or cheeses in parallelepiped shape, of a net weight of 10 kg or more", which must have "a minimum fat content of 50% by weight in the dry matter, matured for at least three months". You've got 'edible offal of bovine animals' rates for "pasture-grazed animals, aged between 22 and 24 months, having two permanent incisors and presenting a slaughter liveweight not exceeding 460 kg". This is not a simple business.

And then there is the small matter of the EU. It has to agree to all these details itself, because its quota will obviously be that much smaller once Britain extracts its share. That is only possible if Britain and Europe are working closely and amiably together through the Article 50 process. If, as hard Brexiters frequently suggest, Britain simply storms off in a huff and goes to the WTO, the first thing it will find is a trade dispute waiting for it there from the EU because there is no agreement on quotas. And that trade dispute is likely to be one of many, with all the other countries affected queuing up behind it.

We don't quite know what happens if those disputes go against us. No-one has ever been brave or stupid enough to do this before. If past experience is anything to go by (for instance the EU-US battle over beef hormones) tariffs will go up by anything up to 100% on other industries, crippling our exports in some unrelated sector. Or if things really get bad it could lead to a trade war.

All of this is the best case scenario. If Britain pursues hard Brexit, which seems increasingly likely, and leaves the single market and customs union with no trade deal on the horizon, it needs to work out what to do about its own imports and exports from the EU, which is a whole other nightmare. That would be in addition to the quota problem for the rest of world. That takes the task from something which is possible but very difficult to something which probably isn't possible at all in this time scale.

So given the complexity of this problem, you have to really hope that Liam Fox's department has recruited the best people, who are aware of the challenges and the timeframe, and getting to work on this now. You have to hope they're being sensible and pragmatically managed to ensure that ideology does not cloud what is a very technical and difficult task. You have to hope that subtle and politically intelligent negotiating techniques are being brought to bear at the WTO to smooth the way for what is about to happen.

Because if not, we're in a lot of trouble

http://www.politics.co.uk/blogs/2016/12/15/if-liam-fox-messes-up-we-re-all-in-deep-trouble

[tonyh29]

57 minutes ago, NurembergVillan said:

It IS a grey area.  Either way, as a politician, referring to a country that has been defunct for a generation is a notable cock-up.

other than a few twitter comments I can't find anywhere that he actually said it .. has anyone seen a clip ?

[lapal_fan]

So... About Donald Tusk saying "Britain still has the option to stay in.." 

Discuss plz. 

[NurembergVillan]

20 minutes ago, tonyh29 said:

other than a few twitter comments I can't find anywhere that he actually said it .. has anyone seen a clip ?

Never mind whether he ACTUALLY said it!  Focus on the disgracefulness of it all!

[tonyh29]

9 minutes ago, lapal_fan said:

So... About Donald Tusk saying "Britain still has the option to stay in.." 

Discuss plz. 

I see he took a leaf out of the OECD's book and hedged his bets a little  when he said the talks could result in 'a good deal, no deal or no Brexit' ...

 

[TrentVilla]

32 minutes ago, tonyh29 said:

other than a few twitter comments I can't find anywhere that he actually said it .. has anyone seen a clip ?

Sure....

 

[chrisp65]

27 minutes ago, lapal_fan said:

So... About Donald Tusk saying "Britain still has the option to stay in.." 

Discuss plz. 

not gonna happen

Labour and Tory are both pro Brexit. Mood music and briefings off might hint otherwise, but that's just keeping the remainer sheep in line with a glimmer of hope.

The tories think there's gain to be made for themselves and their paymaster chums.

Labour think the tories will kill the economy and then they can ride in under the reddest of red flags and nationalise Greggs.

Of course, I guess the Liberals could seize power in a coupe.

Imagine, all of them in a coupe (and a seat for coats), starting a coup.

[NurembergVillan]

1 hour ago, tonyh29 said:

other than a few twitter comments I can't find anywhere that he actually said it .. has anyone seen a clip ?

He DEFINITELY said naynosecond though.  And he looks so proud of himself saying it.  If he hasn't said this for a bet, and that's why he's grinning, then he's even more of a pipecleaner than I thought.

 

[bickster]

1 hour ago, tonyh29 said:

I see he took a leaf out of the OECD's book and hedged his bets a little  when he said the talks could result in 'a good deal, no deal or no Brexit' ...

 

Danny Baker should sue

Are you worried about the lack of workforce in the crisp industry? Crisp manufacturers are worried 

[tonyh29]

1 minute ago, bickster said:

Danny Baker should sue

Are you worried about the lack of workforce in the crisp industry? Crisp manufacturers are worried 

I'm worried in  the same way the French are worried about something that would never happen like , I dunno  a shortage of butter or something

[snowychap]

1 hour ago, tonyh29 said:

I'm worried in  the same way the French are worried about something that would never happen like , I dunno  a shortage of butter or something

Sounds like a pain.

[bickster]

1 hour ago, tonyh29 said:

I'm worried in  the same way the French are worried about something that would never happen like , I dunno  a shortage of butter or something

Really?

Quote

Crisp Making Hit By Brexit Labour Shortage, Reveals UK Food Federation Chief

The industry chief warned a range of producers are struggling to recruit

Crisp production is being hit by a Brexit-induced labour shortage, the chief of the UK’s food federation has said during his starkest warning yet over a drop in migrant workers.

In an interview with HuffPost UK, Food and Drink Federation boss Ian Wright called on the Government to do more to reassure EU migrants they are welcome in the country as companies across the sector experience staff shortages.

 

Wright said an owner of a medium-sized crisp manufacturer told him his factory is having to operate with a 10% drop in the work force – meaning a loss in productivity – as fewer migrants are traveling to the UK for work.

 

The food and drink industry is the UK’s biggest manufacturing sector and contributes £28.2billion to the economy, meaning any slow-down in productivity could have implications for the country’s finances.

 

Speaking from his office in central London just hours after Theresa May published an open letter telling EU migrants she wanted them to stay in the UK, Wright called for the Government to go further.

“I think the Government has moved a long way from where it was the day after Brexit,” he said. But when asked if he felt recent announcements had reassured EU migrants working in the food and drink industry, Wright replied: “The ones who didn’t feel confident still don’t feel confident, and the ones who were confident are still confident.

 

“There’s a still a significant drain of European workers leaving and there are fewer coming.” 

 

The latest official statistics show the number of EU citizens who came to the UK fell by 19,000 in the year to March 2017 compared to a year earlier, with the number of EU citizens leaving the country up by 33,000 over the same period.

In June, the National Farmers Union revealed the number of seasonal workers coming to work the harvest dropped by 17% in the first five months of 2017.

Even more worryingly for the industry, the number of returnees – who require little if any training because of their experience – fell by 50%.

According to Wright, what started with labour reductions for the harvest is now sweeping across the entire food and drink industry.

“Everyone I talk to is losing people and cannot replace them,” he said. “A guy I was with last week - he’s a medium-size crisp manufacturer. He runs three shifts, 24/6, they don’t work on Sundays, they clean the machines.

“Every shift he’s four or five down because he can’t replace them. It’s a big impact on productivity and a big impact on the capacity to produce stuff.

“He’s now limited, not very, but more limited than he would choose to be in his ability to fulfill orders by a labour shortage. And he’s in the north of England.”

When asked what ongoing impact of labour shortages would be, Wright said: “It’s tightening, it might be a little bit of drift in price, it might be a little bit of drift on availability, it might be a little bit of a drift on choice. It’s just the slight tightening of the circumstances.” 

FOOD AND DRINK FEDERATION

Top 10 food and drink exports from the UK in the first half of 2017.

As for the reasons for the drop in overseas workers, Wright believes cultural and economic factors are to blame.

“One is lack of certainty and a general feeling of unease about whether you should come – but clearly others did come,” he said.

“The other is the currency,” Wright said, referring to the fall in the value of sterling against the euro since the Brexit.

He went on: “If you’re a seasonal worker and you go off and do the harvest somewhere and you get 16% less for your money for your work here and you’ve got the opportunity to go to Germany or France or Spain or Italy you’ll go there.”

FOOD AND DRINK FEDERATION

The drop in sterling might be bad for recruitment, but it has helped food and drink exports.

In the first half of 2017, exports of all food and drink reached £10.2billion – up 8.5% on the previous year.

Increased exports to the EU helped fuel this rise, with a 9% growth in products sent to the bloc totalling £6.3billion.

While the Brexit negotiations are well underway – albeit stuck in phase one of the process – Wright is still unclear as to what immigration system the Government wants to adopt once the UK is out of the Single Market and Customs Union.

He said: “We are no closer to resolving the question of how you replace the flow of free movement of people, and that’s been kicked into the migration advisory committee.

“We won’t hear anything on that for some weeks.”

Some think the WTO is some sort of nirvana of free trade - well, it isn’t.Ian Wright

While frustrated with the Government’s overall lack of direction on key elements of Brexit, Wright is full of praise for Defra Secretary Michael Gove.

“I’m a fan, I think he’s a big beast, he’s a very, very thoughtful and able man. I think his record at Education and Justice demonstrates that he’s someone whose decisions are for the long term.

“I don’t mind there are things that you disagree with him about. I think that’s important and good. He’s extremely courteous.

“He’s the most powerful Secretary of State in Defra and the most impactful for arguably a generation - certainly since Hilary Benn in the 1997 to 2010 Government, and probably before that.

“He’s really taken the trouble to understand, think and I hope for us that he’s there for the long term.”

 

Wright might be a fan of Gove, but he has far less time for Brexiteers who advocate pursuing trade arrangements on World Trade Organisation terms.

“They seem to think the WTO is some sort of nirvana of free trade - well, it isn’t,” he said.

Even when the UK strikes free trade deals with countries including New Zealand, Argentina, and Australia, that could cause some serious problems for the UK’s agricultural sector and the complicated issue of the Northern Ireland/Ireland border.

Wright said: “If you bring in beef and lamb, that is in effect like dumping, and that’s one of the barriers to an Irish border issue, as what the Europeans are terrified about is what they call backdooring.

“If we do what Owen Paterson wants us to do and get access to cheap lamb, cheap beef, cheap whatever, it comes into our market, there’s a bad effect on British beef and British lamb producers. 

FOOD AND DRINK FEDERATION

Ireland is the top market for UK food and drink.

“But there’s a potential of an even worse effect on Northern Ireland which is an agricultural economy, and the Republic of Ireland which is also an agricultural economy.

“That’s one of the reasons why the border issue is so difficult, because you are dealing with an integrated agrarian economy and the prospect of an entry of that kind is hugely disruptive to both the economics of the countries and also the social cohesion.”

 

Huff Post

[bickster]

5 minutes ago, snowychap said:

Sounds like a pain.

It would make one a very cross ant

[bickster]

3 hours ago, chrisp65 said:

 

Of course, I guess the Liberals could seize power in a coupe.

 

 

Typical Liberals, drinking champagne as they go 

[TrentVilla]

6 hours ago, chrisp65 said:

Of course, I guess the Liberals could seize power in a coupe.

Doesn’t sound very Liberal...

[chrisp65]

4 minutes ago, TrentVilla said:

Doesn’t sound very Liberal...

[peterms]

3 hours ago, snowychap said:

Sounds like a pain.

Take your mind off it by doing something distracting.  Dancing, maybe.  Perhaps a last tango?

[tonyh29]

4 hours ago, bickster said:

Really?

 

Huff Post

I think you missed the humour intent of my post

I’d read the same article didn’t expect someone to quote it though , what with it praising Gove  

[StefanAVFC]

http://www.bbc.co.uk/news/uk-scotland-scotland-politics-41749270

Quote

UK government assessments of the potential economic impact of Brexit on Scotland will not be made public, the Brexit secretary has confirmed.

But the analysis will be shared with the Scottish government, David Davis told a committee of MPs.

Mr Davis told the Brexit select committee that publishing the analysis could undermine the national interest.

However, Nicola Sturgeon said people had a right to know how leaving the EU would affect all areas of the UK.

And she said any refusal to release the information to the public would be "unconscionable".

Research published by the London School of Economics earlier this week estimated the loss of economic output in Scotland could be £30bn.

There have also been suggestions that the UK government analysis suggests that Scotland and the north east of England will be hit hardest by leaving the EU.

Mr Davis told the select committee that the House of Commons had decided not to publish anything that would "undermine national interest".

He said releasing industry-specific information was the equivalent of "giving a price list to the other side".

But he confirmed the Scottish impact analysis would be shared with the Scottish government.

Speaking earlier, Ms Sturgeon told MSPs: "There are suggestions that the UK government has sector specific analysis of the impact of Brexit.

"There's a suggestion that it has an analysis looking particularly at Scotland as a whole but thus far there's been a refusal to publish those analyses.

"I think that's unconscionable. I think the public have a right to know."

She added: "It might not be in the interest of the UK government to publish these, it's certainly in the national interest to publish them."

Cowardly. How can anybody reasonable support the Tories? Force the hardest of Brexits while hiding the impact of it from the public.

**** off.

Edited October 26, 2017 by StefanAVFC

[Chindie]

The argument that releasing these impact studies would somehow harm the negotiations is absolutely pants on head stupid.

They're being withheld for domestic concerns. If they by some miracle were filled by good news, they'd be screamed from the rooftops by every minister and would bedeck all the Brexit supporting front pages every day.

I certainly hope someone leaks them. I'd be interested to see exactly how bad the government sees it.