We will hear a lot of noise over the coming days and weeks from multinationals, often foreign-owned or run, calling for acceptance of the deal being put forward by the Prime Minister, because it is in their narrow vested interests that the UK. should remain trapped in the customs union and tied to EU regulation.
Multinationals see their advantage in segmenting markets, producing cheaply and selling at the highest possible margin. Barriers to entry of competition are a positive for them, gaming complex regulatory systems are their meat and drink.
If foreign-owned and run organisations have any loyalty beyond maximising executive bonuses and shareholder return, it is to their homeland. It is little wonder that some of the most vociferous proponents of a bad deal for Britain have been the German-owned Siemens and BMW, the Franco/German owned and German-run Airbus and the French-owned Nissan. Even the Indian-owned Jaguar Land Rover has a German Chief Executive.
Only 8 per cent of UK businesses, representing 13 per cent of the economy have any trade with the EU and yet 87 per cent of the economy and 92 per cent of businesses are shackled by EU regulation and taxed by EU tariffs. UK consumers are paying over the odds as a consequence and UK taxpayers are themselves paying to sustain this regime. We are in a bizarre looking glass world.
There are undenied rumours that Greg Clark, backed by the Chancellor, Philip Hammond, secretly promised foreign-owned car manufacturers that the government would engineer our continued membership of the Customs Union for their convenience. That would mean Britain signing away any possibility of trade deals around the world or of reducing the cost of living and boosting the economy by the removal of EU imposed tariffs, purely in order not to inconvenience a car industry which represents half a per cent of UK employment and 4 per cent of the economy. A car industry which would be marginally impacted in practice.
It means accepting the worst deal in history, a deal which will keep the UK in the same position vis a vis the EU as a colony. A perpetual rule taker, with British consumers and taxpayers a profit “milch cow” for French agriculture and German manufacturers.
Many thousands of British business owners and entrepreneurs want rid of the EU straitjacket, but many dare not say so because of the current climate of intimidation from the business establishment.
The deal that has been put forward would have taxpayers pay £39 billion (and more according to the Chancellor’s red book) for nothing, money which could be invested in boosting the economy, enough to pay for 60 thousand nurses, teachers and police, a cost of £2500 for families across the country, £600 for every man, woman and child.
May’s proposal will see the UK trapped forever in a Customs Union that will prevent us making trade deals around the world including with the US, Canada, Australia and New Zealand. We will be cutting ourselves off from a world in which 90 per cent of future economic growth will take place. Liam Fox and his Trade Department will be redundant.
The duff deal will give EU access to our fishing waters continuing the demise of the UK fishing industry. We already see forty large foreign trawlers hoovering up our fish stocks in the Bristol Channel while our lonely boats pick up the crumbs. This picture is repeated all around our shores.
Under the Prime Minister’s sell out, we will remain tied to EU regulations, the final nail in the coffin of trade deals and a denial of any differential advantage to UK business. A continuing dead hand of European bureaucracy bearing down on 100 per cent of our economy for the sake of 13 per cent. But more than that, it completely undermines the promise that we would take control of our own laws.
With the Eurozone going towards a single finance minister, unified fiscal policy and taxation, the implications of the squeeze this control of regulation beggars belief.
The deal points us in the direction of military integration, with all the evidence pointing towards continuing involvement in EU institutions and even a European army. Not only does this deny Brexit, it has grave implications for an independent defence industry.
It might convivial for UK bureaucrats and quangocrats to continue on expenses paid jaunts to the EU but it is not an excuse to sell our sovereignty.
No deal is undoubtedly now the best deal by far for business, the economy and the only deal that will deliver the Brexit people voted for. Far from being a “cliff edge” or “crashing out”, no deal will deliver global trade on WTO terms. It should be remembered that 57 per cent of our exports are not to the EU but to the rest of the world, and most of this trade is already under WTO rules. It is the normal, tried and tested way of conducting trade in the world.
Talk of shortages is nonsense. The only circumstances in which there could be a disruption of imports is if the U.K. government chose to prevent things coming into the country from the EU. Even the totally useless government we have now would not be so mad as to do that. As our legislation currently recognises EU standards, there is no reason why there would or should be such non-tariff barriers on food and goods, and the same would apply to raw materials and components.
As for tariffs, our government can choose to remove them unilaterally for selected products, or all products for that matter. This would both reduce the cost of living, especially for the poorest and boost the economy and thus tax receipts, what is not to like?
No deal would enable the deployment of the £39 plus billion and ongoing savings from not paying our contribution to the EU. Money which can go into infrastructure and tax cuts, further boosting the economy. Even our current, visionless, Chancellor has “threatened” to reduce corporation tax! I cannot see why corporate Britain is not queuing up to embrace a no deal solution.
A WTO future would guarantee that we are free to strike our own trade deals around the world. It will end free movement thus incentivising a high productivity, high wage, high growth economy. We will immediately be able to begin to formulate a smart regulation environment in which entrepreneurialism will thrive. A declaration now for a WTO exit, to be implemented in March next year, will provide the much desired, absolute certainty for business. By contrast, the PMs deal will produce a further two years and more of strife and uncertainty.
Of course, there will be some short-term discomfort for some businesses. There will be creative disruption, leading quickly to an economic boom and the very thing the EU and it’s key member states are terrified of, a competitive and successful U.K.
There is no doubt that for those businesspeople who believe in free markets, innovation and in Britain, the Prime Minister’s deal is an utter disaster while a WTO exit on the 28th March would be manna from heaven. A no deal future provides a wealth of opportunity. Let’s embrace it.
To read the piece in full, click here.