Brexit

[Que]

Brexit and the economic fall out of the pandemic:

[...]
As it have its official spring forecasts, the commission also said it expected the UK to be among the five European countries to suffer most from the economic impact of the coronavirus, with recovery then set to be hampered by the country's exit from the EU's single market at the end of the year.

The commission said the UK economy was expected to shrink by 8.3% by the end of the year, as a result of lockdown measures, with investment down 14% and unemployment doubling
the highest number of coronavirus deaths in Europe and the ECDC said the country was one of a handful where there had been no significant downturn in the number of infections.

Only the GDPs of Greece, Italy, Spain and Croatia are expected to contract more than the UK's.
The French economy is forecast to shrink by 8.2%, a similar figure to the UK, but the recovery of the British economy is likely to be hampered by the extra barriers to trade when the Brexit transition period ends.

The commission listed the the blow to the UK's hospitality and continued uncertainty about the outcome of the country's departure from the EU as reasons for its relatively poor economic prospects.

The UK government is negotiating with Brussels on the terms of trade once Britain leaves the single market and customs union.

https://www.theguardian.com/business/2020/may/06/coronavirus-threatens-future-eurozone-brussels-economic-social-divisions-pandemic

[Irons]

Brexit and the economic fall out of the pandemic:

https://www.theguardian.com/business/2020/may/06/coronavirus-threatens-future-eurozone-brussels-economic-social-divisions-pandemic

The Guardian gets more quotes (and tasteless cartoons) in this and other threads on this forum of any British paper. I can't for the life of me think why. 

[Que]

I'll quote a source other than The Guardian.... What about the Office for National Statistics?

UK GDP fell by 10.4% in the three months to April 2020
GDP fell by 20.4% in April 2020

This makes the UK one of the most severely hit economies in Europe.
If the transition period expires without a deal that would keep the UK in the internal market, things will definitely get even worse...

My question is: will Boris be prepared to commit economic & political suicide?

Or... is he going to use the pandemic as a cover for severing all close economic ties to the EU?

Q

[Mandryka]

This makes the UK one of the most severely hit economies in Europe.

Why should the UK economy be hit / scarred more severely than other European economies?

[MusicTurner]

Why should the UK economy be hit / scarred more severely than other European economies?

Do you disagree with the statement - or do you ask generally for the reasons behind the current or future crisis with regards the UK?

[Que]

Why should the UK economy be hit / scarred more severely than other European economies?

Good question.

Because national economies are different. The UK economy is a services economy,  is heavily reliant on international trade and in urgent need of modernisation. The impact of the pandemic on the UK is in the European top-5, behind Greece, Italy, Spain and Croatia, and just ahead of France.

The next good question would be:

If this is the case, why is the UK leaving the biggest economic bloc on the planet? 

Q

[Irons]

Good question.



The next good question would be:

If this is the case, why is the UK leaving the biggest economic bloc on the planet? 

Q

And with the greatest urgency. There must be a reason and I confess I have no idea what. A good question to ask Cummings but no chance of him explaining why. One day we will know.

[Que]

Boris has decided that he will go head on, and the negotiations will have no fall back position: it will be make or break...

UK formally rejects Brexit transition period extension (Politico)

Q

[Irons]

UK announces border checks and tariffs delayed for six months to allow business to adjust.

Will be interesting to see if the EU replicate.

[Que]

UK announces border checks and tariffs delayed for six months to allow business to adjust.

Will be interesting to see if the EU replicate.

It has already anounced that it won't.

And it can't, because it would create a huge hole in the tariff border of the EU which would be used by every business in the EU to channel their imports through the UK into the EU free of any tariffs and checks.

It would be like a hole in a bucket...
For the UK it works the other way around: the hole will allow an influx of necessary goods. 

From the Financial Times:
"The EU will enforce full customs and regulatory checks immediately after Brexit and will not reciprocate the UK's plan for a temporary light touch border on the British side of the English channel, a senior Brussels official warned on Friday.

Maroš Šefčovič, a vice-president of the European Commission who co-chairs a EU-UK committee implementing the Brexit withdrawal agreement, said that while the UK border was a matter for the British government, the bloc would robustly maintain its equivalent.

The British government on Friday proposed a temporary light touch border regime for goods flowing into the UK from the EU, as ministers sought to ease the burden on companies following the coronavirus crisis.

But Mr Šefčovič indicated goods heading into the EU from the UK would face full customs and regulatory checks.
"I can assure everyone that the EU will continue to fully protect the integrity of the single market and customs union as well as its financial interest," he said, after the UK formally confirmed it would not seek to extend the Brexit transition period beyond December.

The EU approach emerged as the UK provided details about how it will phase in new border controls over a six-month period from January, in order to help companies adjust to new trading arrangements as Britain leaves the bloc's single market and customs union."

[accmacmus]

Sad to see Barnier's tweets today, you can feel the disappointment at the negotiating table.

[Que]

A FREE article from the Financial Times:

Covid crisis likely to mask economic fallout of no-deal Brexit

Economists question why UK would want to inflict further pain on businesses


Economists agree that a no deal Brexit would have dire consequences for the UK economy.
Johnson has ruled out an extension of the transition period, but is quite  up beat about a deal before the negotiation deadline of end of October!

I'm convinced he will strike a deal, preferably one that looks good politically.
I think he will ask and get from the EU a compromise on fisheries, which is politically hugely important..... and economically insignificant.

The deal itself is probably going to be a pretty basic free-movements-of-goods kind of deal with some extras thrown in, like cooperation in the field of  justice & security and the continuation of special programs, like in education (Erasmus) and healthcare for British expat pensioners and holiday makers.

Politically Johnson will save face and will be able to claim victory on fisheries and liberation from the yoke of the EU.
Thanks to the free movement of goods there won't be lines of truck on the roads to Dover.

But in reality there will be restrictions on the possibilities in the negotiations on a bilateral trade deal with the US, which the US is not going to like. And the irony will be that this kind of deal will solve most of the problems for the EU,  while it won't safeguard the all important services sector for the UK....

IMO the UK will get stuck between a rock and a hard place...
Over time the only way forward will be to get back into the single market (the "Norway option") through a second bilateral treaty with the EU,  probably signed by Keir Starmer as PM... (?)

Q

[Irons]

A FREE article from the Financial Times:

Covid crisis likely to mask economic fallout of no-deal Brexit

Economists question why UK would want to inflict further pain on businesses


Economists agree that a no deal Brexit would have dire consequences for the UK economy.
Johnson has ruled out an extension of the transition period, but is quite  up beat about a deal before the negotiation deadline of end of October!

I'm convinced he will strike a deal, preferably one that looks good politically.
I think he will ask and get from the EU a compromise on fisheries, which is politically hugely important..... and economically insignificant.

The deal itself is probably going to be a pretty basic free-movements-of-goods kind of deal with some extras thrown in, like cooperation in the field of  justice & security and the continuation of special programs, like in education (Erasmus) and healthcare for British expat pensioners and holiday makers.

Politically Johnson will save face and will be able to claim victory on fisheries and liberation from the yoke of the EU.
Thanks to the free movement of goods there won't be lines of truck on the roads to Dover.

But in reality there will be restrictions on the possibilities in the negotiations on a bilateral trade deal with the US, which the US is not going to like. And the irony will be that this kind of deal will solve most of the problems for the EU,  while it won't safeguard the all important services sector for the UK....

IMO the UK will get stuck between a rock and a hard place...
Over time the only way forward will be to get back into the single market (the "Norway option") through a second bilateral treaty with the EU,  probably signed by Keir Starmer as PM... (?)

Q

The EU have said a no deal would have dire comprises on the UK economy. As Johnson said to Barnier you are a negotiator not a referee.

I agree with much of your analyses with perhaps exception of the Starmer prediction. 

[accmacmus]

More from Barnier https://twitter.com/Barnes_Joe/status/1281261419472838656

Still «significant divergences» with little time to go...

[Pohjolas Daughter]

Quite interesting to read about what is happening with Brexit--including the new problems created by Covid.  I'm sorry, though, that it looks like it could turn into an even bigger nightmare for a lot of people.   

Best wishes,

PD

[Que]

All the pre-referendum talk about getting rid of red tape and frictionless trade..... all gone...


Brexit: Get ready because this time it's for real  (BBC)


Q

[Irons]

All the pre-referendum talk about getting rid of red tape and frictionless trade..... all gone...


Brexit: Get ready because this time it's for real  (BBC)


Q

It has. Obvious that Barnier and Frost will never archive a consensus in any shape or form. Prolonging the agony is pointless.

[Que]

It has. Obvious that Barnier and Frost will never archive a consensus in any shape or form. Prolonging the agony is pointless.

Never say never, hopefully a last minute deal can be struck in the interest of both parties. But things are looking dim...

Q

[Irons]

Never say never, hopefully a last minute deal can be struck in the interest of both parties. But things are looking dim...

Q

Not looking good. Both sides are appearing more entrenched in their positions. I thought maybe Merkel could sort it out but her comments last week were far from conciliatory.

[Iota]

Another little nail in the coffin ..

It's seemed for some while that the UK government was not serious about looking for an agreement, and was only going through the motions of doing so, for appearances sake, to provide fodder for the inevitable disingenuous explanations ('we tried, the EU inflexible' blah, blah).
More evidence they weren't serious already came in June, when the UK government refused any extension to the Brexit transition period. This meant that Johnson, in his usual duplicitous way, could now leave the clock to deliver the final coup de grace of a no-deal Brexit, claiming to have worked until the last moment to avoid it.

We're going to be diving from a place of great weakness, into a huge and risky unknown, with a vacuous non-leader at the helm. What could possibly go wrong? 

I very much hope luck is on our side, because competence and clear-sightedness of the path ahead in the upper echelons of this government, seem about as plentiful as coronavirus vaccines.