EDF Straw Poll on EU Referendum

[robbin]

Actually, I just noticed you mentioned Ireland or Frankfurt, so please ignore my reference to the sunshine!

[LondonMix]

Robbin-- what are these greater economic opportunities. Please be specific. The UK will be losing free trade access to the largest trading block in the world as well as losing the trade agreements the EU has struck with 50 other countries globally that the UK currently benefits from.

What exactly will the UK free from the EU do to offset these losses?

Also, to be clear, being a net-importer from a region absolutely does not mean you are better off without access to that region as a trading partner. Quite the opposite.

[robbin]

Sorry - before I reply, how is it quite the opposite?

[LondonMix]

Blah Blah-- I think its a delicate diplomatic matter. While its 100% true that Turkey is no where near gaining entry to the EU, for a leader of a country with veto power over all new entrants (which the UK has) to come out and even intimate that it would be a bad thing if Turkey was close poses certain international diplomacy challenges. I suspect, that is why up until recently Cameron has shied away from making comments that could be construed as anti-Turkey.

[LondonMix]

Sure Robbin.

Losing tariff free access has two impacts:

1. The UK export business will shrink as the higher cost to customers in the EU market will reduce demand.

2. EU imports will also become more expensive increasing price inflation domestically. This inflation will leave the average person worse off and less able to purchase goods and services.

Its not the net position but rather the fact that the UK will suffer two negative simultaneous impacts as it relies on Europe both as export and import market. If the UK only exported to the EU, the overall impact of Brexit would be less significant.

The UK cannot produce these imports for the same cost domestically, otherwise they would do so, so the latter change would be a permanent increase in the cost of a significant amount of goods and services currently enjoyed by UK citizens.

Edited for typo

[robbin]

Cameron has always been staunchly in favour of Turkey joining the EU. He is only backtracking (sort of) now out of desperation...

This from 2 years ago (before the referendum was announced)

7:51PM GMT 09 Dec 2014 - Daily Telegraph

David Cameron has said that he still ?very much supports? Turkey joining the European Union, despite his Government's inability to control numbers of EU migrants coming to the UK. The Prime Minister was quizzed about his support for Turkey?s accession to the EU during a visit to Turkey to meet the country?s Prime Minister and President.

Mr Cameron said he had discussed Turkey?s accession to the EU during talks in Ankara on Tuesday afternoon with Ahmet Davutoglu, the Turkish Prime Minister.

The visit was his first since 2010 when he told the Turks the backed the country?s goal of joining the EU. He said then that he wanted to ?make the case? for Turkey?s EU membership. Asked if he still felt that way despite his Government?s inability to control inward migration from EU countries and bring net migration down to the tens of thousands of people, he said that he had discussed it again with Turkish Prime Minister.

He said: ?In terms of Turkish membership of the EU, I very much support that. ?That?s a longstanding position of British foreign policy which I support. We discussed that again in our talks today?.

In a speech at the Turkish parliament in Ankara in July 2010, Mr Cameron said: ?I?m here to make the case for Turkey's membership of the EU. And to fight for it.?

He added that he wanted to "pave the road" for Turkey to join the EU, saying the country was "vital for our economy, vital for our security and vital for our diplomacy".

A European Union without Turkey at its heart was ?not stronger but weaker... not more secure but less... not richer but poorer?.

[Loz]

robbin Wrote:

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> Cameron has always been staunchly in favour of Turkey joining the EU.

Strangely, so has Boris.

[robbin]

Sorry LM, I don't really follow.

Re (1) I don't see how (as you suggest) the "the UK export business will shrink as the higher cost to customers in the UK market will reduce demand". Firstly, what has demand in the UK market got to do with our exports? Secondly, why will there be higher costs to customers in the UK market? Thirdly, we can still buy from EU - they are hardly going to refuse to sell their products to us! Fourthly, I don't see the link between the UK export business and higher cost to customers in the UK market (even if there was any - which you simply presume without saying why).

Re (2) You postulate "EU imports will also become more expensive increasing price inflation domestically." Why? You can't just say that like it's gospel - why would prices increase? EU exporters will still want to sell to us and will want to stay competitive. Are you suggesting some sort of South African boycott of the UK by the EU?? We will still be allies and close trading partners - not sworn enemies.

Cameron might say the sky will fall in, but that doesn't make it so. The world won't start turning the other way on its axis causing tsunamis in the UK. Trolls with French accents won't really jump out from under Thames bridges and eat us up. Those are about the only scare stories I haven't yet heard from Cameron. But there's still 3 days to go...

[LondonMix]

Not strangely-- he is part Turkish and has always been very pro Turkey joining the EU.

Loz Wrote:

-------------------------------------------------------

> robbin Wrote:

> --------------------------------------------------

> -----

> > Cameron has always been staunchly in favour of

> Turkey joining the EU.

>

> Strangely, so has Boris.

[robbin]

Loz Wrote:

-------------------------------------------------------

> robbin Wrote:

> --------------------------------------------------

> -----

> > Cameron has always been staunchly in favour of

> Turkey joining the EU.

>

> Strangely, so has Boris.

Indeed. If we stay in - we will be joined by Turkey. It's what the UK govt wants (although just now it is painfully difficult to admit) and it is clearly what EU Commission wants (as they stressed again just 48 hours ago when they said they were "accelerating" turkey's application for EU membership (not the best timing for Cameron that!).

Personally I believe we will stay in, so we will see. Another million or two residents for our NHS and schools to accommodate.

[LondonMix]

Hi Robbin,

That was a typo. That should have read

The UK export business will shrink as the higher cost to customers in the EU market will reduce demand. (I'm at work so writing this out quickly). ETA: This phenomena is the same for the 50 countries outside the EU that the EU has a trade agreement with that Britain currently benefits from but will lose access to following Brexit.

The second point is simply the result of how tariffs work Robin. It has nothing to do with a boycott. When trade tariffs are applicable, the cost of imported goods goes up like for like. That's not speculation.

Let me know if that's still unclear.

robbin Wrote:

-------------------------------------------------------

> Sorry LM, I don't really follow.

>

> Re (1) I don't see how (as you suggest) the "the

> UK export business will shrink as the higher cost

> to customers in the UK market will reduce demand".

> Firstly, what has demand in the UK market got to

> do with our exports? Secondly, why will there be

> higher costs to customers in the UK market?

> Thirdly, we can still buy from EU - they are

> hardly going to refuse to sell their products to

> us! Fourthly, I don't see the link between the UK

> export business and higher cost to customers in

> the UK market (even if there was any - which you

> simply presume without saying why).

>

> Re (2) You postulate "EU imports will also become

> more expensive increasing price inflation

> domestically." Why? You can't just say that like

> it's gospel - why would prices increase? EU

> exporters will still want to sell to us and will

> want to stay competitive. Are you suggesting some

> sort of South African boycott of the UK by the

> EU?? We will still be allies and close trading

> partners - not sworn enemies.

>

> Cameron might say the sky will fall in, but that

> doesn't make it so. The world won't start turning

> the other way on its axis causing tsunamis in the

> UK. Trolls with French accents won't really jump

> out from under Thames bridges and eat us up.

> Those are about the only scare stories I haven't

> yet heard from Cameron. But there's still 3 days

> to go...

[Loz]

robbin Wrote:

-------------------------------------------------------

> Loz Wrote:

> --------------------------------------------------

> -----

> > robbin Wrote:

> >

> --------------------------------------------------

>

> > -----

> > > Cameron has always been staunchly in favour

> of

> > Turkey joining the EU.

> >

> > Strangely, so has Boris.

>

> Indeed. If we stay in - we will be joined by Turkey.

Not in the next couple of decades.

[LondonMix]

Robbin, you do realize that immigrants pay taxes (as they have a very high employment rate). They more than cover the costs of the public services they use. The strain on public services infrastructure has to do with austerity, not a burden posed by immigrants. If all the immigrants left the UK tomorrow (as did their tax contributions), there would be a large financial hole for our public services. This combined with the fact that immigrants provide vital skills missing from the health services is why the head of the NHS is pro-Remain.

Anyhow, if you were familiar with those 35 conditions, it would be clear that Turkey is no where near gaining admission.

robbin Wrote:

-------------------------------------------------------

> Loz Wrote:

> --------------------------------------------------

> -----

> > robbin Wrote:

> >

> --------------------------------------------------

>

> > -----

> > > Cameron has always been staunchly in favour

> of

> > Turkey joining the EU.

> >

> > Strangely, so has Boris.

>

> Indeed. If we stay in - we will be joined by

> Turkey. It's what the UK govt wants (although just

> now it is painfully difficult to admit) and it is

> clearly what EU Commission wants (as they stressed

> again just 48 hours ago when they said they were

> "accelerating" turkey's application for EU

> membership (not the best timing for Cameron

> that!).

>

> Personally I believe we will stay in, so we will

> see. Another million or two residents for our NHS

> and schools to accommodate.

[Azira]

Australia is not likely to find us appealing Robbin. Their principal industries are primary industries such as mining, so they are interested mainly in manufacturing countries like China and India. Belgium is lining themselves up to take over the car trade here, so with steel down the pan I can't see that we make enough to warrant buying commodities.

[Azira]

messageRe: EDF Straw Poll on EU Referendum

Posted by robbin Today, 01:39PM

>With the greatest of respect, I think unless someone were choosing to be purposely obtuse it should be obvious what >I meant by 'national' banks as opposed to 'high street' banks. I'm afraid in my field, when we talk >about 'national' banks in this context, all the financial and regulatory lawyers around the table know what we are >talking about.

I genuinely didn't. After I read your less than measured reply, I asked a few of my colleagues what they would think if someone was discussing national vs high street banks and, like me, they thought it was someone talking about national-based banks like RBS rather than central banks. I guess a lot of us financial reg lawyers are obtuse, huh - even those of us who don't use wikis to understand regulatory terms.

As for my use of the word "dearie" - it was a response in kind to your completely unnecessary rudeness. If you were truly thick-skinned, you wouldn't feel the need to make further digs at me for my response to your self-acknowledged poor choice of words or chose to take my comments about condescension (which weren't actually aimed at you, but with the tone of your latest response now seem apt) so personally.

And we have clearly established that BRRD doesn't apply to central banks, as I have acknowledged, so I'm not entirely sure what your point is.

You made an assumption that I was arguing with you about the potential future economic consequences of sovereign default. A fairly cursory perusal of the thread would demonstrate I don't support either the Brexit or Remain assertions about economic consequences, and in fact would be pro-Brexit if it weren't for the immediate economic consequences.

[robbin]

I just don't get all this confident stating of things as facts when I am suspecting you don't actually know (not a criticism - I probably don't either, but it shows the danger of crappy scaremongering debate from both sides). For example, you state as if fact - "immigrants pay taxes (as they have a very high employment rate). They more than cover the costs of the public services they use" - Where are the figure for that please? If it's right its right, but is that even measured?

If you are instinctively in favour of remaining, fine, you are as entitled to your view as anyone else, but stating facts or presuming things as facts upon which other inferences are then drawn, I find rather disconcerting, not to mention unconvincing.

On that note, you also say "The second point is simply the result of how tariffs work Robin. It has nothing to do with a boycott. When trade tariffs are applicable, the cost of imported goods goes up like for like. That's not speculation."

Well, I agree it is not speculation that when tariffs are applicable the costs of goods go up. To be honest that's pretty obvious and I couldn't argue against it. But, it is another statement of fact which is not fact. It is (contrary to what you imply) indeed speculation that there would be tariffs imposed by UK against EU imports. The likelihood is that there would NOT be such tariffs imposed and that we would ultimately do a deal with our EU allies to facilitate the continuation of tariff free trade. Free trade is recognised as in everyone's interests and where we are neighbours and trading countries it would make no sense to raise tariffs. This is something I don't understand about the Remain arguments - our EU allies would not suddenly become enemies and in a trade war with us because we vote to leave in a couple of years time - that's errant nonsense and Cameron scaremongering. Actually, even he hasn't openly or directly said tariffs would be imposed because that's a bonkers suggestion. He just sort of implies it and leaves the fear to the imagination of voters. It seems you have bought into it. I haven't, although the fear tactics are definitely making me nervous as I'm sure they do many others.

[robbin]

Azira wrote:

"I genuinely didn't. After I read your less than measured reply, I asked my colleagues what they would think if someone was discussing national vs high street banks and, like me, they thought it was someone talking about national-based banks like RBS rather than central banks. I guess a lot of us financial reg lawyers are obtuse, huh."

Fair enough, but those I work with are not. Indeed, in the context of my post (which talked about states (Italy/Spain) defaulting, I'm surprised there could be any such misunderstanding. Maybe your colleagues weren't given that detail, otherwise they may have taken a different view.

Also, it's only really in the USA that "national" banks might have a different meaning - but here we were discussing Europe.

[robbin]

Crikey, Azira, I just read the rest of your 5.23 post and I do appear to have offended you! So, I will cease the debate here as I don't want things to get personal. I thought I was being reasonably conciliatory but it doesn't seem to have been taken that way. Sorry.

[Azira]

Interesting that you fault a previous poster for confident stating of the facts then say something like: "Also, it's only really in the USA that "national" banks might have a different meaning." You clearly are in a different practice area to mine.

[robbin]

If you say so.

[LondonMix]

Robbin-- this is what I do for a living so yes I do know actually.

That trade tariffs will be applied following Brexit is the law. The UK will become an independent member of the WTO (right now its membership is via the EU trading block) following the establishment of its own independent terms. As a member, it will legally be required to erect most favored nation tariffs to all countries until it negotiates separate trade agreements with them. The EU by law will have to erect most favored nation tariffs against Britain also.

I get that you aren't familiar with all of this which of course is fine but its insane to simply dismiss it as speculation when these are bold face verifiable facts just because they don't dovetail with your world view.

This is an important vote. Spend a few hours looking into what I've outlined and if you have any questions I'll try to answer them objectively.

The idea that there will only be a small interval between Brexit and the a total free trade agreement is not realistic. The EU has explicitly stated the only access to complete free trade will be under the Norway model which still allows for the free movement of EU citizens between countries. If you believe the UK will accept this, then perhaps but anything else will take years not weeks to negotiate. In the best of times with extremely eager parties, it takes 5 - 10 years to conclude a trade agreement. This is a well established fact, not a guess or speculation. Look up any current trade agreement and see how long they took to agree.

Moreover, Britain will need to establish trade agreements not just with the EU but with the 50 other countries its losing access too if Brexit takes place. The EU has a tremendous amount of global trade agreements because of its important as a trading block and the UK would be walking away from all of that. In fact, all the EU trade agreements including those in the pipeline like the one with Canada cover 88% of Britain's trade.

That's just the immediate trade impact. We haven't even begun discussing the implications for the financial services sector.

robbin Wrote:

-------------------------------------------------------

> I just don't get all this confident stating of

> things as facts when I am suspecting you don't

> actually know (not a criticism - I probably don't

> either, but it shows the danger of crappy

> scaremongering debate from both sides). For

> example, you state as if fact - "immigrants pay

> taxes (as they have a very high employment rate).

> They more than cover the costs of the public

> services they use" - Where are the figure for that

> please? If it's right its right, but is that even

> measured?

>

> If you are instinctively in favour of remaining,

> fine, you are as entitled to your view as anyone

> else, but stating facts or presuming things as

> facts upon which other inferences are then drawn,

> I find rather disconcerting, not to mention

> unconvincing.

>

> On that note, you also say "The second point is

> simply the result of how tariffs work Robin. It

> has nothing to do with a boycott. When trade

> tariffs are applicable, the cost of imported goods

> goes up like for like. That's not speculation."

>

> Well, I agree it is not speculation that when

> tariffs are applicable the costs of goods go up.

> To be honest that's pretty obvious and I couldn't

> argue against it. But, it is another statement of

> fact which is not fact. It is (contrary to what

> you imply) indeed speculation that there would be

> tariffs imposed by UK against EU imports. The

> likelihood is that there would NOT be such tariffs

> imposed and that we would ultimately do a deal

> with our EU allies to facilitate the continuation

> of tariff free trade. Free trade is recognised as

> in everyone's interests and where we are

> neighbours and trading countries it would make no

> sense to raise tariffs. This is something I don't

> understand about the Remain arguments - our EU

> allies would not suddenly become enemies and in a

> trade war with us because we vote to leave in a

> couple of years time - that's errant nonsense and

> Cameron scaremongering. Actually, even he hasn't

> openly or directly said tariffs would be imposed

> because that's a bonkers suggestion. He just sort

> of implies it and leaves the fear to the

> imagination of voters. It seems you have bought

> into it. I haven't, although the fear tactics are

> definitely making me nervous as I'm sure they do

> many others.

[Blah Blah]

"I get that you aren't familiar with all of this which of course is fine but its insane to simply dismiss it as speculation when these are bold face verifiable facts just because they don't dovetail with your world view."

This for me has absolutely characterised my personal experiences of debating with people who are set on voting for leave.

[robbin]

"I get that you aren't familiar with all of this which of course is fine but its insane to simply dismiss it as speculation when these are bold face verifiable facts just because they don't dovetail with your world view."

This for me has absolutely characterised my personal experiences of debating with people who are set on voting to Remain.

[robbin]

The idea that trade tariffs will be imposed immediately (because it is 'the law')is a nonsense. First of all the minimum period in law of any withdrawal after it is triggered by notice under Art 50 of the Lisbon Treaty is 2 years during which time there are mandatory negotiations between the EU and the party leaving. During that time both parties are very likely to see that protectionism is a nonsense and will only hurt both the EU and UK, so deals will be done and extensions of time agreed in the parties' mutual interests. Before anyone says that's nonsense, here's the reality of what the real influencers in Germany think:

From the BBC about 4 hours ago:

"A German industry boss has said it would be "very, very foolish" if the EU imposes trade barriers on the UK in the event it votes to leave the EU. Markus Kerber, the head of the influential BDI which represents German industry, said his organisation would make the case against such measures.

He said any introduction of tariffs would be "regression to times we thought we'd left behind in the 1970s".

The UK's referendum on whether to leave the EU will be held on Thursday.

"Imposing trade barriers, imposing protectionist measures between our two countries - or between the two political centres, the European Union on the one hand and the UK on the other - would be a very, very foolish thing in the 21st Century," Mr Kerber told the BBC's World Service.

"The BDI would urge politicians on both sides to come up with a trade regime that enables us to uphold and maintain the levels of trade we have, although it will become more difficult." Mr Kerber added that any introduction of tariffs would lead to job losses in Germany and the UK.

[LondonMix]

Robbin, I never said that there wasn't a two year period to complete Brexit. In fact, I've said that explicitly before. After the referendum nothing will change, including EU law, migration or trade until the 2 years of negotiation period have expired. The fate of the British citizens in the EU (over 1m) and the legal status of the EU citizens already living in the UK all need to be agreed and formalized during that period amongst hundreds of other things.

However, without a new trade agreement at the end of the two year period, it is the law that tariffs would have to go up otherwise other members of the WTO could ask for penalties. Industrialists may push for a new agreement to be negotiated during that two year window as its naturally in their interest. However, France and Germany (the actual politicians responsible for carrying out an agreement) have explicitly stated they won't start trade negotiations until after the 2 year period has expired.

Of course you can choose to believe they are bluffing but I believe they mean what they have explicitly said as they have good reason for doing so.