Merged Now What?

[Airfix]

Of course rejoining EFTA would cost about £8.5bn a year............

Actually EFTA's annual budget is smaller than our weekly contribution to the EU:

EFTA budget 2016
Budget posts (in CHF)
Trade relations with countries outside the EU 5,000,000
EEA related activities 7,914,000
EFTA/EU statistical cooperation 744,000
EFTA Council and horizontal activities 2,088,000
EU/EFTA and EFTA cooperation
programmes 2,710,000
Administration and management 3,221,000
Total 21,677,000
Contributions to the EFTA budget 2016
Member
State Share % Contributions
(in CHF)
Iceland 2.62% 570,267
Liechtenstein 0.96% 208,900
Norway 54.68% 12,001,787
Switzerland 41.74% 8,896,046
Total 100.00 21,677,000

It's a much cheaper organisation to be a member of.

 

[Airfix]

No-one claimed that you had.

If we're out of the EEA then our £26bn trade surplus with the EU in service goes up in smoke - not good

If we're in the EEA then likely we'll have the same requirements for financial contributions, adherence to EU legislation and movement of people but without any way to influence them - not ideal

How is Brexit an advantage to the UK ?

We haven't had much influence in the EU anyway (see David Cameron's failed attempt at reforming it).
Brexit allows us to pay a lot less, have our own free trade deals and be exempt from EU harmonised taxation legislation such as the VAT directive of 2006 which set a minimum level for VAT across the EU at 15%.
A future UK government will be able (if they wish to) to lower VAT to 5%.

 

[The Don]

No it doesn't, we will still do trade within the EEA, what tariffs we, and they, have to pay are up for negotiation.

Now that we have the London Gateway port we are less tied to Rotterdam as our port of transfer for foreign transfer, this has been a leading point in why our EU trade has declined, we simply don't have to move our goods over there to ship them further on.

Goods made in other counties still have to meet CE compliance, our leaving the EU makes no difference to that directly, only towards the formation of the rules themselves. My experience is that many rules regarding electrical and machine safety stem from British standards anyway, though strongly influenced by TUV.

That all relates to goods, not services. I also suspect that I was either imprecise or inaccurate about what I said.

Yes, we can trade with the EEA but if we want to be able to continue to trade with the EEA on current or similar terms then we will, like Norway, will have to make a significant financial contribution, adhere to the vast majority of EU rules and allow the free movement of people.

Being on the outside will mean that there will be some inconvenient tariffs for companies selling widgets but the service industries will be in real difficulties.

Of course there is the fantasy position that we will continue to be able to trade with the EEA on the same basis without having to contribute financially, adhere to the rules or allow the free movement of people due to the exceptional skills of our negotiators but that isn't going to happen.

 

[Archie Gemmill Goal]

We haven't had much influence in the EU anyway (see David Cameron's failed attempt at reforming it).
Brexit allows us to pay a lot less, have our own free trade deals and be exempt from EU harmonised taxation legislation such as the VAT directive of 2006 which set a minimum level for VAT across the EU at 15%.
A future UK government will be able (if they wish to) to lower VAT to 5%.

Great. Will the people who proposed leaving also be proposing a 5% VAT rate? Presumably topped up from applying it to tooth fairy transactions and a hefty tariff on unicorn meat and rocking horse poo?

Fantasyland indeed

 

[The Don]

We haven't had much influence in the EU anyway (see David Cameron's failed attempt at reforming it).

Well that's the myth spread by the leave campaign but the truth is quite different. Nothing much happened in the EU without the approval of the "Big Three" (UK, France, Germany) and as the voting record shows the UK didn't get its own way 57 times out of more than 2500 votes.

Now if your definition of "not much influence" is that we don't get all our own way all the time then I think you need to recalibrate your expectations before the post-Brexit negotiations start.

Brexit allows us to pay a lot less,

How do we know ? Not only do we not know what kind of deal we will end up with (fair enough, the negotiations have not started) we don't even know what basic model we intend to negotiate towards.

have our own free trade deals

Only if the other parties wish to enter a free trade deal. The UK has so much less clout than the EU and so many fewer skilled trade negotiators than the EU and yet somehow we will manage to negotiate these fabulous deals

The recent spat with China gives a more accurate view of our future.

and be exempt from EU harmonised taxation legislation such as the VAT directive of 2006 which set a minimum level for VAT across the EU at 15%.
A future UK government will be able (if they wish to) to lower VAT to 5%.

That's like saying that a UK government free of the shackles of international law would be free to torture prisoners of war - yes that's theoretically true but would it actually happen ?

We also have no idea what terms the EU may demand for membership of the free trade area. Harmonised taxation is probably one of those things.

 

[The Don]

It's a much cheaper organisation to be a member of.

The per-head contributions are around the same. Once the UK joins there will be far more to administer.


edited to add....

Norway net contribution - around £96 per person per annum - same as the UK

https://infacts.org/norwegians-pay-same-brits-eu-access/

 

[Airfix]

The point is that governments whose countries are not in the EU are sovereign and do not have to follow EU law to the letter.

We could have any rate of VAT whether it be higher or lower than the EU's specifications.
Free trade deals with any country or trade bloc.

 

[Airfix]

Well that's the myth spread by the leave campaign but the truth is quite different. Nothing much happened in the EU without the approval of the "Big Three" (UK, France, Germany) and as the voting record shows the UK didn't get its own way 57 times out of more than 2500 votes.

That's right, 57 times our politicians opposed the EU, 57 times we were outvoted.

Now if your definition of "not much influence" is that we don't get all our own way all the time then I think you need to recalibrate your expectations before the post-Brexit negotiations start.

We only get "our own way" when the politicians actually agree with what the EU wants to do.

How do we know ? Not only do we not know what kind of deal we will end up with (fair enough, the negotiations have not started) we don't even know what basic model we intend to negotiate towards.

Unless we sign the EEA agreement, we don't know.

But nobody wants a trade war, it's not in anyone's interest to have a trade war.

Only if the other parties wish to enter a free trade deal.

27 countries have already expressed an interest.
order-order dot com/2016/07/29/brexit-breaking-free-global-markets/

The UK has so much less clout than the EU and so many fewer skilled trade negotiators than the EU and yet somehow we will manage to negotiate these fabulous deals

We will have to, we're leaving the EU.

The recent spat with China gives a more accurate view of our future.

Maybe it does, maybe it doesn't, but we're leaving the EU so we need to make this work.

That's like saying that a UK government free of the shackles of international law would be free to torture prisoners of war - yes that's theoretically true but would it actually happen ?

Can I just remind you that we remain a member of the Council of Europe, and it's Convention on Human Rights.

We also have no idea what terms the EU may demand for membership of the free trade area. Harmonised taxation is probably one of those things.

The treaty of the EEA agreement already exists, I suggest you read it.
www dot efta dot int /media/ documents /legal-texts/ eea /the-eea-agreement /Main%20Text%20of%20the%20Agreement/EEAagreement.pdf

 

[Andy_Ross]

Exactly.



I wonder if that's been factored into the cost of Son-of-Trident?

It applies to any industry that is importing anything.

 

[The Don]

That's right, 57 times our politicians opposed the EU, 57 times we were outvoted.

....and in the remaining 2500 or so we did get what we wanted.

Expecting to get your own way all the time is unrealistic

We only get "our own way" when the politicians actually agree with what the EU wants to do.

Evidence ?

The Leave campaign kept harping on about how the UK had lost sovereignty and how we had to do whatever the EU told us but failed to point out that the UK wielded considerable influence in the EU.

Unless we sign the EEA agreement, we don't know.

But nobody wants a trade war, it's not in anyone's interest to have a trade war.

Fallacy of the excluded middle. There is a full range of options, an all-out trade war is at one extreme. The issue is that we have no idea what kind of relationship is even being targeted.

27 countries have already expressed an interest.
order-order dot com/2016/07/29/brexit-breaking-free-global-markets/

http://order-order.com/2016/07/29/brexit-breaking-free-global-markets/

First question is how reliable a source is order-order.com and how accurate is its information (after all it shows the US as being keen for a free trade agreement even though the President said we'd be at the back of the queue) but let's give it the benefit of the doubt....

Of course major economies are going to express an interest, they see an opportunity to make a deal in the international equivalent of a fire sale. They will be able to extract far better terms from an anxious UK government desperate to demonstrate that all is OK post-Brexit

We will have to, we're leaving the EU.

Oh I know we will have to, it's the magical thinking that we'll be able to get fabulous terms that I'm challenging.

Maybe it does, maybe it doesn't, but we're leaving the EU so we need to make this work.

More magical thinking. Here we have a clear example of a weak UK having to deal with a powerful country. This will be the new norm post-Brexit.

Can I just remind you that we remain a member of the Council of Europe, and it's Convention on Human Rights.

Yes, and ?

I was using it as example of how the UK has international obligations which prevent it doing things that it would never do anyway (like dropping the rate of VAT)

The treaty of the EEA agreement already exists, I suggest you read it.
www dot efta dot int /media/ documents /legal-texts/ eea /the-eea-agreement /Main%20Text%20of%20the%20Agreement/EEAagreement.pdf

And we have no idea whether we would be able to join and/or what terms would be extracted.

Heck the whole mess is so poorly planned that we do not even know whether we're planning to ask to join.

 

[The Don]

The point is that governments whose countries are not in the EU are sovereign and do not have to follow EU law to the letter.

...and as a result they do not have easy access to the EU.

The better the access, the more expensive it is and the greater proportion of EU legislation they have to adhere to.

We could have any rate of VAT whether it be higher or lower than the EU's specifications.

We could, but then again we have no idea what restrictions that would place on us. What I was trying to get across is that having to have a VAT rate of at least 15% is no real restriction if there are no plans to have it lower than that.

Free trade deals with any country or trade bloc.

Only if we can negotiate favourable terms

 

[Airfix]

I was using it as example of how the UK has international obligations which prevent it doing things that it would never do anyway (like dropping the rate of VAT).

As an emergency measure the rate of VAT was cut by Gordon Brown's government to 15% in 2008 to stimulate shop sales. They were legally prohibited from going lower than 15%.

http://news.bbc.co.uk/1/hi/business/7757854.stm

 

[cullennz]

I seriously don't get how people can't understand that the UK won't get crap all because they left

 

[Airfix]

I'll agree with you on something, the way our government has handled matters, there wasn't even a plan for this eventuality, David Cameron assumed that remain would be a given and forbade civil servants from coming up with contingencies.

So now, we're in a convoluted mess, businesses don't know what trade deal we're going to have, it makes investors worried.
The only thing we can be certain of is that we're leaving.
At present we don't know if we'll be following WTO MFN rules, or EU tariff free rules.

I believe (and stuff Nigel Farage's feelings on this) that we should ask EFTA if we could be able to rejoin in order to have single market access via the EEA agreement.

 

[Airfix]

I seriously don't get how people can't understand that the UK won't get crap all because they left

It's not the end of the world.
We were trading with Europe in the 1960's, we sold engines to Sud Aviation to power the Caravelle.
We jointly developed Concorde (the predecessor of Airbus) and the Sepecat Jaguar. The project which became the Panavia Tornado began in the 1960's.

We sold stuff into dissimilar economies across the whole world. We still sell more to the rest of the world than the EU.

Don't get me wrong, the EU is an important market for us, but membership is not the only way to sell into that market.

New Zealand has offered to lend us it's negotiators to help us get a deal with the EU, and New Zealand wishes to have a free trade agreement with us.
http://www.telegraph.co.uk/business...uk-its-top-trade-negotiators-for-post-brexit/

Before we were members of the EEC/EU we used to have a tariff free trade deal with New Zealand and New Zealand butter was very popular in the UK (Anchor being the biggest brand), when we joined the EEC suddenly we had to levy tariffs on goods from NZ and other Commonwealth countries.

 

[catsmate]

No it doesn't, we will still do trade within the EEA, what tariffs we, and they, have to pay are up for negotiation.

Now that we have the London Gateway port we are less tied to Rotterdam as our port of transfer for foreign transfer, this has been a leading point in why our EU trade has declined, we simply don't have to move our goods over there to ship them further on.

Goods made in other counties still have to meet CE compliance, our leaving the EU makes no difference to that directly, only towards the formation of the rules themselves. My experience is that many rules regarding electrical and machine safety stem from British standards anyway, though strongly influenced by TUV.

Goods ≢ Services.

 

[catsmate]

We haven't had much influence in the EU anyway

Untrue.

(see David Cameron's failed attempt at reforming it).

You mean attempting to force the EU to change to suit the UK.

Brexit allows us to pay a lot less,

Unsupported assertion.

have our own free trade deals

It may surprise you to know that such deals require agreement from both sides. The UK is a far smaller and less enticing market than the EU and so will be less able to negotiate deals that suit it.

and be exempt from EU harmonised taxation legislation such as the VAT directive of 2006 which set a minimum level for VAT across the EU at 15%.
A future UK government will be able (if they wish to) to lower VAT to 5%.

 

[catsmate]

The point is that governments whose countries are not in the EU are sovereign and do not have to follow EU law to the letter.

They do if the EU makes it a condition of trading with the block.

We could have any rate of VAT whether it be higher or lower than the EU's specifications.

And it the EU says you can't as a condition of a free-trade deal, e.g. EEA membership?

Free trade deals with any country or trade bloc.

Again, the UK is in a far worse position to negotiate such deals than the EU.

 

[catsmate]

It applies to any industry that is importing anything.

So I wonder how much it'll add to that particular white elephant? And what other parts of the UK defense budget will be cut to pay the extra?

 

[Airfix]

Again, the UK is in a far worse position to negotiate such deals than the EU.

When the EU negotiates a deal, it has to fit the needs of all EU member countries plus partner country.

When the UK begins negotiating deals it will only have to get a deal to suit the needs of the UK plus partner country.

So is that really a "worse" position to negotiate ?
It could be a lot easier.

Rather than moaning that the "EU is better", we need to accept that we won't be in it and find a way to trade that works well.

Some things about the EU are better, some things aren't. My interest in it began when I heard Tony Benn talk about it in the Maastricht commons debates of the early 1990's (but I digress).

We need to find a way to make Brexit work, otherwise the economy will be damaged.