So Boris Johnson has somehow managed to "a deal" with the EU which consists of a new Withdrawal Agreement and an accompanying Political Declaration. In my view the deal is a very crappy deal let me explain why
1) There is going to an expensive monitoring of goods crossing the border between Great Britain and Northern Ireland. Good coming into the UK from the US (perhaps tariff free) could be re-exported to Northern Ireland and face the EU tariff of 10%. If the cars ends up with Northern Ireland resident then they will be able to claim the 10% tariff back. If a Southern Ireland resident buys the car the Southern Ireland will not be able to claim the 10% tariff bank. Well you don't have to be a genius to work out that a Northern Ireland resident might on-sell the car to a southern Ireland Resident and the Northern Ireland resident get the 10% tariff back Effectively the Southern Ireland resident gets the car tariff free. Once in Ireland the car could leak freely into the rest of the EU effectively tariff free. Hence there will need to be costly monitoring to make sure this does not happen.
2) In the absence of a future UK/EU trade deal, the rest of the UK will have to treat the EU (45%) the same as we do the UK, China and Japan and impose tariffs on imported EU good which come into the UK tariff free at present will have to have tariff imposed on them. In addition the EU will have to treat the UK as they do Japan, US and that means impose tariff on our goods that are equivalent to those imposed on the US. China and Japan. That is what departing the Customs Union means. It also means £15 billion in extra costs in the form of bureaucracy for UK companies that they do not currently have.
3) It is a terrible deal for 66 million UK citizens, as we impose tariff on imported EU goods then this will negatively affect all UK citizen by raising the price of cars, food,clothing, imported inputs into the UK production process etc.
4) UK will lose access to the single market, we are currently free to sell service across the EU a UK licence is sufficient to do this..Services represent 80% of the UK economy losing our easy access to sell banking, insurance we have a huge surplus on services trade quite a lot of that surplus will disappear.
5) Losing access to the single market means that 40,000 haulage trucks will have to fight for 4,000 special third country permits after leaving the single market. Devastating for that industry.
6) The UK will become a lot less attractive for both domestic firms (harder to export goods tariff free to the EU) and also as a location for Foreign direct investment. Why put a car factor in Wales or Sunderland to face EU tariffs? Why employ extra people in London if you cannot sell some financial services into Europe that will be done in Dublin, Amsterdam or Paris instead.
7) UK will not be able to recruit so easily from the talent pool both skilled and unskilled that is vital to the health of the UK economy. There is no doubt that the UK has gained greatly from this labour.
In fact most projections show that Boris deal is even worse than Theresa May's deal see Link. Boris deal will worsen GDP by between 2.3% and 7% whereas Theresa May's would worsen GDP by 1.9% to 5.6%. Sure both are better than no deal a fall in GDP of 3.5% to 8.7%. All are very bad outcomes. Many people will be a lot worse off as many fall below the average and others will lose less than the average.
So it now comes down to super saturday. My guess is Boris gets defeated as he does not have the DUP on board Boris Johnson told the DUP in November 2018
"If we genuinely wanted to do free trade deals, if we wanted to cut tariffs, if we wanted to vary our regulation, then we would have to leave Northern Ireland behind as an economic semi-colony of the EU," he said."And we would be damaging the fabric of the Union with regulatory checks and even customs controls between Great Britain and Northern Ireland, on top of those extra regulatory checks down the Irish Sea that are already envisaged in the Withdrawal Agreement.
"Now I have to tell you, no British Conservative government could or should sign up to any such arrangement
Here is the video
1) There is going to an expensive monitoring of goods crossing the border between Great Britain and Northern Ireland. Good coming into the UK from the US (perhaps tariff free) could be re-exported to Northern Ireland and face the EU tariff of 10%. If the cars ends up with Northern Ireland resident then they will be able to claim the 10% tariff back. If a Southern Ireland resident buys the car the Southern Ireland will not be able to claim the 10% tariff bank. Well you don't have to be a genius to work out that a Northern Ireland resident might on-sell the car to a southern Ireland Resident and the Northern Ireland resident get the 10% tariff back Effectively the Southern Ireland resident gets the car tariff free. Once in Ireland the car could leak freely into the rest of the EU effectively tariff free. Hence there will need to be costly monitoring to make sure this does not happen.
2) In the absence of a future UK/EU trade deal, the rest of the UK will have to treat the EU (45%) the same as we do the UK, China and Japan and impose tariffs on imported EU good which come into the UK tariff free at present will have to have tariff imposed on them. In addition the EU will have to treat the UK as they do Japan, US and that means impose tariff on our goods that are equivalent to those imposed on the US. China and Japan. That is what departing the Customs Union means. It also means £15 billion in extra costs in the form of bureaucracy for UK companies that they do not currently have.
3) It is a terrible deal for 66 million UK citizens, as we impose tariff on imported EU goods then this will negatively affect all UK citizen by raising the price of cars, food,clothing, imported inputs into the UK production process etc.
4) UK will lose access to the single market, we are currently free to sell service across the EU a UK licence is sufficient to do this..Services represent 80% of the UK economy losing our easy access to sell banking, insurance we have a huge surplus on services trade quite a lot of that surplus will disappear.
5) Losing access to the single market means that 40,000 haulage trucks will have to fight for 4,000 special third country permits after leaving the single market. Devastating for that industry.
6) The UK will become a lot less attractive for both domestic firms (harder to export goods tariff free to the EU) and also as a location for Foreign direct investment. Why put a car factor in Wales or Sunderland to face EU tariffs? Why employ extra people in London if you cannot sell some financial services into Europe that will be done in Dublin, Amsterdam or Paris instead.
7) UK will not be able to recruit so easily from the talent pool both skilled and unskilled that is vital to the health of the UK economy. There is no doubt that the UK has gained greatly from this labour.
In fact most projections show that Boris deal is even worse than Theresa May's deal see Link. Boris deal will worsen GDP by between 2.3% and 7% whereas Theresa May's would worsen GDP by 1.9% to 5.6%. Sure both are better than no deal a fall in GDP of 3.5% to 8.7%. All are very bad outcomes. Many people will be a lot worse off as many fall below the average and others will lose less than the average.
So it now comes down to super saturday. My guess is Boris gets defeated as he does not have the DUP on board Boris Johnson told the DUP in November 2018
"If we genuinely wanted to do free trade deals, if we wanted to cut tariffs, if we wanted to vary our regulation, then we would have to leave Northern Ireland behind as an economic semi-colony of the EU," he said."And we would be damaging the fabric of the Union with regulatory checks and even customs controls between Great Britain and Northern Ireland, on top of those extra regulatory checks down the Irish Sea that are already envisaged in the Withdrawal Agreement.
"Now I have to tell you, no British Conservative government could or should sign up to any such arrangement
Here is the video
The guy is basically a liar and a cheat - he is not to be trusted in any way shape or form !
The political declaration is not worth the paper that it is written on ! The whole point of Brexit for the Brexiteers is they want to lower standards, remove social protection and they want a hard Brexit ! So I have a simple message do not trust this man or his party on this.
This does not get "Brexit done" it is just the beginning of a very long process of negotiating a new longer term trade deal with the EU and a huge amount of arguing and haggling will continue for years to come.
What will happen. Well it looks like the DUP cannot support this deal, some Labour leave MPs may support it around 5 or 6, some of the 21 he threw out of the Tory party will support it, most of his part including the ERG will now support it. So that means 287 + 7 (labour) +16 (thrown out Conservatives) + 4 other independents = 315 votes. Not enough he needs 320 votes. That means he will have to ask for an extension till January 31, 2020. My view is the EU will grant an extension and I expect that his deal will get approved if it is subject to a "confirmatory referendum." I have always thought this would end up with a second referendum, 1 million plus will be on the march on super Saturday 19/10/2019 asking for a second referendum or Peoples vote. That is where I believe we will end up sometime next week - time will prove me right or wrong.
The political declaration is not worth the paper that it is written on ! The whole point of Brexit for the Brexiteers is they want to lower standards, remove social protection and they want a hard Brexit ! So I have a simple message do not trust this man or his party on this.
This does not get "Brexit done" it is just the beginning of a very long process of negotiating a new longer term trade deal with the EU and a huge amount of arguing and haggling will continue for years to come.
What will happen. Well it looks like the DUP cannot support this deal, some Labour leave MPs may support it around 5 or 6, some of the 21 he threw out of the Tory party will support it, most of his part including the ERG will now support it. So that means 287 + 7 (labour) +16 (thrown out Conservatives) + 4 other independents = 315 votes. Not enough he needs 320 votes. That means he will have to ask for an extension till January 31, 2020. My view is the EU will grant an extension and I expect that his deal will get approved if it is subject to a "confirmatory referendum." I have always thought this would end up with a second referendum, 1 million plus will be on the march on super Saturday 19/10/2019 asking for a second referendum or Peoples vote. That is where I believe we will end up sometime next week - time will prove me right or wrong.
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