Richard North, 19/03/2017  
 


What is truly terrifying, as the days tick away to Theresa May's triggering of Article 50, writes Booker, is how little those in charge have any grasp of what they will be facing.

In fact, trying to understand how little those people know is in itself a gigantic task. In an attempt to piece together their mindset, I stumbled across a piece from Brexit Central which seems to capture the essence of the vacuum.

This is from Patrick de Pelet (formerly a divisional head with Kleinwort Benson and a Group Director of Dresdner Kleinwort), who argues that a free trade agreement can amount to our current relationship stripped of what he calls the "six components": the Single Market; the Customs Union; free movement of people; payments for access to the single market; jurisdiction of the European Court of Justice and the application of EU regulations, other than to actual trade between the two countries.

Given the scale of the UK market for EU exports, he says, it is self evident that it is to the overwhelming advantage of the EU to continue to trade tariff free with the UK. He adds:
This can be readily achieved by agreement that on the day following Brexit, all trade, including trade in services, continues seamlessly, stripped of the six components. At a stroke the EU will have put in place its most important FTA, without the need for any complex, long drawn out negotiation. There would be no cliff edge and all uncertainty would be removed. The reality is that the UK-EU free trade agreement is already in place and merely has to be renewed.
There lies the core fantasy. After Brexit, the EU can just decide to trade with us on the same basis that it did before, without the "six components", and without the need for any substantial negotiation.

What's missing here is any recognition that the UK, on leaving the EU, becomes a "third country" with its status defined in EU law. Having of its own volition, ceased to be a member state, any rights of access to Member State markets will cease. We must then negotiate new access, starting from scratch.

Thus does Booker pick up the story, telling us that, by deciding to leave the Single Market and the European Economic Area, we are seemingly left with only two options. Either we can negotiate a unique "free trade deal" or we can just walk out, on the basis, in Mrs May’s words, that "no deal is better than a bad deal".

Last week, when David Davis, our minister for "exiting the European Union", met a committee of MPs, the headlines centred on his admission that he still hadn't asked his officials to produce any estimate of the cost of the "no deal" option.

However, he did at least concede that our financial services would lose their "passporting" rights to continue operating in the EU, that we would lose our EU health cards and drop out of the EU-US "open skies" agreement.

But he also admitted that "trading delays" were "potentially as big a problem as tariffs" (although the MPs, obsessed with tariffs, failed to follow up on what this could involve). Davis hoped we might be given an extension of the "electronic, light-touch customs checks" that allow 10,000 of our trucks a day to move goods anywhere in the EU without border controls.

What he still doesn't seem have grasped is that the moment we leave the EU (and the European Economic Area) without a deal, automatically to become a "third country", we are automatically excluded from EU electronic databases, on which international customs system rely. And in the absence of a data sharing facility, we would have to revert to paper-based systems and inspection procedures which could soon have lorries backing up from Dover to London and beyond.

Davis did, in passing, mention the need for "phytosanitary" (plant health) checks, but not the rules for veterinary inspection of our exports of live animals and "animal products", including cheese and eggs, which would now have to be diverted to an EU "Border Inspection Post". The nearest, at Dunkirk, is so small that it would require massive expansion, and an army of new inspectors, with trucks waiting days for clearance.

Davis blithely hoped that we can somehow secure "mitigation" of all the rules and customs procedures which are the very essence of the EU (although it is hard to imagine how we could negotiate "mitigation" through a deal we walk away from). But what beggars belief further is the idea that we could negotiate all this and far more in just two years.

His ally, Lord Ridley, tried to come to his aid in The Times by assuring us that trade deals can all be agreed in a matter of months. But he didn't seem aware, for instance, that talks about a trade deal between the EU and South Korea, far less complex than that we will be asking for, began in 1993 and the latest agreement didn't come into force, with 1,400 pages of documents, until 2011.

As for the fond belief that, without any deal, we could continue to trade with the EU just "under WTO rules" – those still suggesting this are clearly unaware that not a single developed country trades under this arrangements.

The EU treaty database shows that it alone has no fewer than 880 bilateral trading arrangements, covering almost every country in the world, including 20 with the US and 67 with China; all of which we would drop out of by leaving the EU.

The horrifying fact is that our politicians are heading for these negotiations without any real idea of what a mighty elephant trap awaits them – which could have been avoided if only we had been clued-up enough to leave the EU but remain in the European Economic Area. Alas, Booker concludes, we have preferred the elephant trap.

And that is certainly the case with Liam Halligan in the Telegraph, who declares that: "Trading under World Trade Organisation rules after Brexit would be no hardship".

And, in common with the Viscount Ridley, he declares that: "The EU and US trade under WTO rules, as do the US and China and the EU and China. Most of the trade conducted across the globe is under WTO rules".

Bizarrely, from the security of his own little bubble where he so eagerly parades his ignorance, he then goes on to assert: "That is the reality – even if much of the UK's political and media class is determined not to grasp it".

There does not seem to be a way of countering this depth of ignorance, so deep that the man believes himself to be a purveyor of "reality", despite being factually incorrect. The mantra is so firmly embedded in his psyche that it barely seems possible that it can be rooted out.

But then, this is no longer about facts – it seems to have become a religion, in which case Halligan is professing his faith. How strange though that a national newspaper is so imbued with this mythology that fact-checking has become a thing of the past.

Our newspapers now have more in common that with religious tracts, as they become divorced entirely from the events in the real world that they claim to report.

Leaving the EU, in the eyes of the zealots – and a distressing number of journalists - has now become a creed which requires adherence to a nihilistic code, where acolytes are bound by their articles of faith to pursue the destruction of the UK economy, while asserting that it is all in our better interests.

Civil wars have broken out over less.






comments powered by Disqus

















Log in


Sign THA
Think Defence





The Many, Not the Few