Wednesday 2 March 2016

Ten years to unravel our EU exit? Bollocks

Here's the scenario: June 24th 2016. The Great British public has just voted overwhelmingly to leave the EU. That is a final decision and it now has to be acted upon by the UK government (and Civil Service) as well as the EU itself.

There are clearly many things that will now need to be sorted out - UK border controls will need to be put back in place - this will really mean changing the designation of the queues at our ports and ending the assumption that EU passport-holders will sail through, not a lot more. This will take a couple of days and the changing of a few signs.

Clearly there will be issues of varying priority, complexity and urgency and these will take their own course, but this will be against a backdrop of a focused and clear directive that they must be sorted out to the satisfaction of both sides and that if this is not the case, the UK reserves the right to simply walk away from the negotiations and impose its own sovereign solution. And, now we are outside the EU and we are no longer beholden to our European 'friends', it is not incumbent upon us to help them, and they cannot insist we do things against our own will or interests.

It is also, now, within our gift to impose time limits beyond which we simply revert to our preferred default position. Resolving the many problems caused to the EU by our departure is their problem not ours and whilst we will, in a spirit of cooperation and as a friendly neighbour, try to help, we will not be subject to any kind of control from the EU. It is through our goodwill not our duty that we will help them - if it is in our interests to do so.

Trade is arguably the most urgent issue: Like a night's unoccupied hotel bedroom, you cannot get back that 'product' to sell the next day and this will be seen as the case as far as UK-EU trade is concerned. As far as the EU is concerned, the UK is its biggest customer in the world, the trade deficit in favour of the EU for 2015 was £89 billion - business and industry in the EU simply cannot afford for this trade to dry up whatever happens to the political machinery of the EU - a stoppage in trade, however brief, for the EU whose economy is already teetering on the brink of recession, could be disastrous.

By the same token, the UK will also be keen to establish a positive trade arrangement with the EU as quickly as possible after the vote on June 23rd.

And neither side will want to impose tariffs or any kind of barriers to trade upon the other because that would damage the relationship that is in the interestes of both sides - but is significantly more vital to the EU than it is to the UK.

If you think, therefore, that the EU will impose punitive trade sanctions against the UK in the event of a vote for Brexit, you are, quite simply - and this is a technical economic term - a fucking idiot.

Here's the best analogy I can come up with at the moment: Your biggest customer has decided to move out of the office building in which you both currently operate. This customer has found a better (cheaper, more convenient) place in which to base itself but it still wants to trade with you. Remember this is your biggest customer in the world and you make far more money by trading with this customer than he makes from his trade with you.

So what do you do? Do you try to impose sanctions as a punishment for leaving? Or do you thank your lucky stars that he wants to carry on the trading relationship on which you depend - and without which your business will be decimated, because without it your entire business is teetering on the brink of recession/failure?

If you can find me one business person in the world who would choose the punitive route in this scenario, please point me in their direction. Or I can just wait to find them in the bankruptcy courts.

It'll never happen. Not in a million years and for the UK Government to suggest that it will is abject stupidity at best, and utter deception at worst.

Ten years to unravel our membership? Maybe in some areas like toasters or vacuum cleaners but trade? If, on June 24th we said, we'll continue to trade as usual, but we will impose 40% tariffs on EU goods into the UK if you haven't sorted the issue out in 3 month's time, I guarantee that the issue would be sorted within three months. There is absolutely no other option open to the EU - or more accurately to the German industrialists who would demand that Merkel and her puppet the EU did as they were told. No alternative whatsoever.

Thanks for reading.






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