‘No deal’ means ‘no deal’
03 July 2019
L. Alan Winters CB is Professor of Economics and Director of the Observatory.
Last week I was challenged twice for using the term ‘no deal’. There is no such thing, I was told, because, even if the UK does not ratify the Withdrawal Agreement of 25th November 2018, there will still be plenty of deals. At the time I thought, for several reasons, that this was wrong in substance if not literally, but more recently I have concluded that it is also dangerous. Like we saw in the referendum campaign, it undermines informed debate by deliberately confusing the terminology.
‘The deal’ is an agreement between the EU and the UK ‘setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union’ (Article 50 – Treaty on European Union). ‘No deal’ is the absence of such a deal. For business and the economy, ‘no deal’ has come to mean the absence of a trade agreement under which the UK and the EU trade with each other on terms better than those provided for under the World Trade Organization. The former ‘no […]
Briefing Paper 34 – THE FUTURE OF UK-US TRADE: AN UPDATE
Within days of Mr Johnson becoming Prime Minister, President Trump announced that talks about a “very substantial” trade deal with the UK are under way. In this joint Briefing Paper with colleagues from Georgetown University and UKTPO fellows, we consider the effects that Brexit uncertainty is likely to have on the capacity of the UK to agree a deal with the US and ask whether a deal is politically even possible in the UK. We investigate key issues in negotiating a bilateral agreement: the backstop and the problems posed by the EU and US standards regimes. The paper also explores the prospects and pitfalls of the US Government guidelines for negotiations between the US and the UK; the US’s potential strategic position on services and the declining importance of the UK and Europe as traditional places of spending for US multinational corporations especially in the areas of information technology soft- and hardware. Overall we conclude that while the governments involved see obvious political attractions in a UK-US free trade agreement, a quick and economically significant conclusion to the talks seems unlikely.
Read Briefing Paper 34 – THE FUTURE OF UK-US TRADE: AN UPDATE
Briefing Paper 33 – WINNERS AND LOSERS FROM INTERNATIONAL TRADE: WHAT DO WE KNOW AND WHAT ARE THE IMPLICATIONS FOR POLICY?
Economists have long argued, and with good justification, that international trade brings overall benefits to economies. However, increasing trade is likely to create losers as well as winners. As the UK prepares to leave the EU and have an independent trade policy it is important to understand how future trade agreements, or policy changes, may affect economic outcomes such as prices, productivity and output, and through these, individuals and regions.
In this Briefing Paper, the authors provide a conceptual background of how trade changes may result in winners and losers – be these consumers, workers, regions, or industries, and give an overview of what the empirical evidence tells us about how developed economies have adjusted to changes in trade. They also consider potential policy responses that could help losers from international trade adjust, and ensure that the winners can take advantage of the new opportunities created by trade liberalisation.
Read Briefing Paper 33 – WINNERS AND LOSERS FROM INTERNATIONAL TRADE: WHAT DO WE KNOW AND WHAT ARE THE IMPLICATIONS FOR POLICY?
Launch and Panel Discussion at British Academy, 18 July 2019
Ambition and reality: a UK-South Korea free trade agreement
1st July 2019
Dr Minako Morita-Jaeger, International Trade Policy Consultant and Fellow, UK Trade Policy Observatory at the University of Sussex.
The British and South Korean governments settled on an agreement in principle on ‘trade continuity’ on 10 June. Although there is no official information on its content or duration, Dr Liam Fox, Secretary of State International Trade, tweeted that it would be a base for an ‘ambitious future free trade agreement (FTA)’ when the UK leaves the EU. If so, what would be possible options for such an FTA? And how realistic are these ambitions? […]
The Writing on the Wall: FDI Inflows and Brexit
28 June 2019
Nicolo Tamberi is a Research Assistant in Economics for the UK Trade Policy Observatory. Dr Ingo Borchert is Senior Lecturer in Economics at the University of Sussex and a fellow of the Observatory.
On Wednesday, the Department for International Trade (DIT) released its official statistics on inward foreign direct investments (FDI) for the financial year 2018-19.[1] As stated by the DIT, these data measure the inflow of ‘new investment, expansion, and mergers & acquisition’ projects, both publicly announced and not. […]
Dispute Resolution in EU Trade Agreements: A Preliminary Glimpse of a New World Order
26 June 2019
Erika Szyszczak is a Research Professor in Law at the University of Sussex and a Fellow of UKTPO
The Dispute Mechanism Systems (DMS) in many trade agreements have lain dormant because countries preferred to use the World Trade Organization (WTO), with its Appellate mechanisms, as the forum to resolve international disputes. This may change in the coming years as the confidence in, and reliability of the WTO, is slowly paralysed by the disruptive attitude of the United States. One question that emerges is whether the use of EU dispute resolution mechanisms offer a faster and clearer approach towards dispute resolution and might serve as a model for future regional trade treaties. […]
Trump and Mexico: Why the UK should care
07 June 2019
Julia Magntorn Garrett is a Research Officer in Economics at the University of Sussex and a fellow of the UK Trade Policy Observatory.
On Thursday last week (May 30) President Donald Trump threatened to levy tariffs on all US imports from Mexico. The UK should take note, as this has implications not only for Mexico, but for the UK as well. […]
Briefing Paper 32 – A POST-BREXIT GENERALIZED SYSTEM OF PREFERENCES FOR THE UK: HOW TO GUARANTEE UNCHANGED MARKET ACCESS FOR DEVELOPING COUNTRIES?
Post-Brexit, the UK will offer preferential market access to developing countries under a Generalized System of Preferences (GSP). To allow developing countries to export to the UK after it leaves the EU on the same terms as the present, the UK Government’s plan is to replicate the GSP of the EU. This paper shows that simply rolling over the EU’s GSP, in particular, the rules for preferences removal (graduation), will determine changes in market access due to the uneven distribution of developing countries’ trade between the UK and the EU27 bloc. The country most affected would be India, which would lose trade preferences in the UK on a volume of trade worth approximately € 1.27 billion per year. Adjustments to the GSPs of both the UK and the EU, necessary to avoid the loss of trade preferences, are also discussed.
Read Briefing Paper 32 – A POST-BREXIT GENERALIZED SYSTEM OF PREFERENCES FOR THE UK: HOW TO GUARANTEE UNCHANGED MARKET ACCESS FOR DEVELOPING COUNTRIES?
Briefing Paper 31 – CAN THE UK DO BETTER THAN JUST ROLLING OVER THE TRADE AGREEMENT WITH KOREA?
In the case that the UK manages an orderly Brexit and has a transition period until the end of 2020, rather than just rolling over the existing agreements, what would be the possible options for future Free Trade Agreements?
In the case of a future UK-Korea deal, the UK could potentially negotiate a new FTA built on the Korea-EU FTA (KorEU) or negotiate a completely new FTA modelled on the Korea-US FTA (KORUS). Our comparative analysis of KorEU and KORUS in services reveals that the two agreements took very different approaches for services trade liberalisation. Both achieved “GATS-plus” liberalisation commitments from Korea. KORUS seems to have achieved slightly more than KorEU. However, KORUS is more complicated and less transparent than KorEU. It also contains more WTO-inconsistent features. The KORUS option would enable the UK to better pursue its own specific needs since it would not be directly bound by KorEU. On the other hand, the WTO-inconsistent aspects of KORUS would need to be avoided, based on a clear vision of UK’s contribution towards the future multilateral trading system. Either way, the UK would face two stumbling blocks: the UK’s lack of negotiating power and the Most Favoured Nation (MFN) clauses in […]
Not just a technical exercise: a look at new UK pesticides regulation
15 May 2019
Chloe Anthony, Ffion Thomas and Emily Lydgate
In this blog, we take a closer look at the legislation that is being used to bring existing EU pesticide regulations into UK law in preparation for leaving the EU. We find that departures from EU pesticides legislation are significant. The new legislation consolidates powers to UK ministers to amend, revoke and make pesticide legislation and weakens both enforcement arrangements and the requirement to obtain scientific advice. […]
