City A.M.: How bright are the prospects for UK trade and prosperity post-Brexit?

8 December 2017

The EU is fundamentally protectionist.

Big businesses lobby Brussels for more regulation, making it more difficult for small companies to enter the market and compete. The customs union has more than 13,000 common external tariffs and EU consumers pay 17 per cent above world prices on food and drink as a result.

The Single Market is not a free trade area, but a single protectionist zone where regulations are standardised. Only six per cent of UK companies trade with the EU, accounting for 12 per cent of GDP, but 100 per cent of UK regulations are dictated by Brussels.

The Single Market has done little for our trade with the EU, which has fallen from 60 per cent to 43 per cent since its introduction. UK trade with the rest of the world has grown three times faster. Services account for 80 per cent of our economy, but only 40 per cent of service exports go to the EU.

The result? A £82bn trade deficit in 2016: a £96bn goods deficit, offset by just a £14bn services surplus.

The EU’s serious misallocation of resources means that a whopping 40 per cent of the EU budget goes to farmers, despite agriculture accounting for only one per cent of the bloc’s GDP.

What’s more, the Common Agricultural Policy encourages overproduction, leading to wine lakes, butter mountains and the dumping of tinned tomatoes in Africa – ruining local economies.

To read David Blake’s piece for City A.M. in full, click here.

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