Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Yes, even though trade blocs have been in fashion in recent years.
In the specific case of UK-US trade, I doubt that Brexit will interfere with the existing level of trade because there is no formal agreement.
I don't think it will affect 'trade' as much as the 'stay' campaigners think, at the end of the day people/governments will trade with whoever benefits them, do you think the French will stop sending their wine if we left? I don't think so, my job means I buy equipment from all over the globe and a lot of equipment bought in bulk comes from China, the fact that its 'cheap' makes it very appealing to our customers.
Of course I just simplified the WTO arbitration process, because the current agreements include an EU with the UK, if the UK leaves the EU is a different entity, thus there is no requirement for the other party of an EU treaty to agree to, when Croatia joined the EU they had to amend the trade agreement with South Korea (since the agreement did not include Croatia), that would apply to any agreement that the EU has today. However it's in the best interests of the EU, UK, and WTO to make the whole situation seamless as possible, confidence is the big issue, if confidence can be restored by minimizing immediate impact, then everything will quickly recover, however if there is complete carnage, then we could be looking at another world depression. No one wants that, so it makes sense that all involved (including the French who threw their toys out of the pram with the TTIP negotiations) to put on their big girl panties and act like the statesmen they were elected to be.
That equally applies to the third party and the EU, we don't know which specific market is the highest consumer of specific exports from specific nations, if the consumer market is the UK, then those countries may well demand a renegotiation with the EU, since it's fundamentally different post UK exit, and they don't receive the same benefits of the EU trade agreement that they formerly did.
Size of market gross is irrelevant, if the trade is predominantly between the UK and India, sure the EU is has the potential to be a bigger market if everything works out, but if the UK is a bigger market now, then you don't want to lose that market. A dollar in your pocket is worth more now than possibly two dollars next month. They could work out the kinks as time progresses.
India couldn't impose a 25% import tariff on goods, that would violate it's agreement with the WTO.
Trade agreements are a bit of a red herring. The WTO requires that all members are limited to the restrictions an tariffs they place on member trade items, whether or not they have a formal agreement or not. Trade will occur whether or not there is a formal agreement, where the WTO comes in is if there needs to be obstacles removed or unfair practices being enacted against trading partners.
Agreements are often signed so that more favorable terms can be defined than standard WTO, there's a bunch of conditions across all government functions.
Your claim that the EU/WTO agreements are void and need to be renegotiated simply because the UK leaves the EU is just plain nonsense. That view is predicated on the mistaken belief that because the UK steps out from underneath the EU umbrella the umbrella leaks. That's wrong. What happens is that the UK gets wet, and needs to take remedial action. Those remaining in the EU continue on as before. They have done nothing that changes their status.
You're arguing that because the UK leaves the EU, the EU is no longer the same entity. If your argument had any validity, then the same would be true every time new countries joined the EU. Many countries have joined at a point after the EU ratified its WTO agreements, and there has been no EU/WTO renegotiation. I don't know the specifics of the Croatia/Korea situation, but the obvious question is why only Korea? You appear once again to be arguing from the specific to the general. I've already explained the fallacy of that to you.
The basic function of the WTO is to adjudicate disputes between countries. That can't be done unless the signatories have agreed to certain rules. The EU has agreed to rules. If the UK leaves it has agreed to zero, and only the UK needs to remedy that.
Except that you don't need an inter-governmental trade deal to do business. Neither the UK nor the EU has a 'trade deal' with the USA at this point in time but the USA remains their biggest single trading partner.
There are plenty of countries in the world that are doing business and trade just fine without negotiated trade deals. Don't make it sound like the UK international trade will suddenly disappear if it leaves the EU.
Does the US even have a free trade agreement with China? That's the world's largest two economies.
No-one is suggesting that trade will "suddenly disappear", rather that it will diminish because there is more red tape.
-- By Nicholas Vinocur and Tara Palmeri
6/8/16, 5:10 PM CET
PARIS — France is not ready to let Britain get away from the European Union scot-free.
If the U.K. votes to leave on June 23, Paris will push to ensure that consequences are felt swiftly and severely to avoid emboldening anti-EU forces elsewhere in the bloc, senior EU diplomatic sources said.
France’s tough stance foreshadows major difficulties for London in the event of Brexit, as a core EU member tries to assert its influence in a reconfigured bloc and sway other countries against adopting an easygoing attitude toward Britain. Some of those countries, such as Germany, are more inclined to favor a softer approach.
The French push is focused on convincing the remaining EU countries to unwind all treaties and agreements binding the U.K. to the bloc quickly, so the divorce is sealed by withdrawing subsidies, re-evaluating trade relationships sector-by-sector, denying British supervisory bodies EU recognition in areas like financial services, and establishing new immigration rules, to name just a few levers, the sources said.
“If we say you are outside the EU but can keep all of the advantages, access to the single market without any solidarity, it’s a terrible message for the rest of the EU,” said a senior EU diplomat who asked not to be named due to the non-public nature of discussions. “[A painless Brexit] is impossible if we want to keep the rest of the EU present.”
The need to send a message is all the more pressing for the French political elite with the anti-EU National Front positioned to make a strong showing in the country’s 2017 presidential election. France would not be acting out of spite, officials said, and has no interest in setting off a tit-for-tat war of punitive measures.
But as a core EU member, sources said it had a responsibility to strengthen the bloc and deprive anti-EU parties — not just the FN but also the likes of Geert Wilders’s Party for Freedom in the Netherlands — of a chance to use Britain as a shining example of what life can be after the European Union.
“We should avoid a punitive logic,” said Elisabeth Guigou, Socialist head of the foreign affairs committee in France’s lower house National Assembly. “But our president was right when he said that Brexit will have serious consequences…. We will need to fight the centrifugal [political] forces, to show that we can draw conclusions from Britain’s decision.”
She added: “Britain will have to exit from all treaties with the EU. I think that process should go as quickly as possible, and it must not dominate the European Union’s whole agenda.”
Europe’s basic treaty foresees a maximum of two years of negotiations — led by the Commission, but on terms decided by the remaining 27 EU countries — before Brexit becomes a fact. Britain would retain full membership rights in the European Union until those negotiations are concluded.
But that process can be extended if all 27 other EU countries agree to it — or potentially accelerated, if they can rapidly reach common positions on the terms of a new relationship with Britain. France, though it carries a lot of weight in discussions affecting the EU treaties, won’t be the only country with strong views on how Britain should be dealt with during the divorce proceedings; Germany, the bloc’s most powerful member, has an interest in keeping a strong relationship with the U.K., and other regional blocs of countries will also have a say.
But diplomats said there will be clear push to get the Brexit process done quickly if Britain votes to leave.
Stumbling blocks
There are some areas in which France is unlikely to press for tough terms. For example, imposing restrictions on visa or travel rights for some 200,000 Brits who live in France (of which 69,000 are pensioners) could backfire. France has some 160,000 citizens living in Britain, who could be targeted in turn by visa restrictions on foreign travelers and workers.
“[The French] don’t want to create an EU economic cold war,” said Petros Fassoulas, secretary general of European Movement International, a leading pro-EU group in Brussels.
However, there are other ways of demonstrating that withdrawal from the EU can lead to painful payback. One is to restrict the “passporting” of financial services, which allows foreign-owned companies to do business with the EU via offices located in Britain. The principle works because the EU recognizes the authority of British supervisory bodies.
But in the event of Brexit, the EU may no longer recognize that authority, which could push firms to leave Britain and establish bases inside the European Union.
“I would be very tough [on this point],” said Sylvie Goulard, a French MEP who sits on the committee for economic and monetary affairs. “I see no reason to give passporting to a country that decides in a sovereign way to leave the EU…. The day the U.K. leaves … you cannot consider the British supervising authority as an authority of the EU.”
A similar logic would apply for British clearinghouses, or financial institutions that act as intermediaries between buyers and sellers. Currently, Britain-based clearinghouses are supervised by the Bank of England, but comply with EU regulations. If Britain left the EU, member countries would re-evaluate whether they recognize clearinghouses such as LCH.Clearnet, and may push to force all clearing houses to be based inside the EU — as the European Central Bank has already suggested should be the case.
On trade, EU countries would have to hammer out the terms of a new relationship with Britain — a process that would involve negotiations via the European Commission, and difficult debates in the Parliament and Council. Each country would seek an advantage for its own commercial interests against British competition, with France ready to lobby hard for agriculture.
Paris and other EU capitals hope that Britain would adopt Norway’s model of trade with the union, under which it accepts all EU regulations including the free movement of workers in exchange for access to the single market.
But Michael Gove, the U.K.’s Euroskeptic secretary of state for justice, has said that Britain would no longer seek access to the single market as such. Instead, it would try to renegotiate the terms of its relationship along the lines of existing deals between the EU and outsider states like Switzerland, Bosnia, Serbia, Albania — all of which have varying levels of closeness with the bloc.
If Britain opts for restrictive terms, such as denying free movement of workers, Paris and other capitals will push for a narrower relationship, possibly including customs checks for all British products entering the bloc.
Cooling effect
As for British workers employed in the European Union, they could face much less favorable conditions if Britain rejects free movement of workers.
For example, a U.K. citizen living in France, or any other EU state, would not have automatic access to social services like public health care and public pensions, because those rights are not extended to citizens of non-EU nations.
There are also ways of affecting the quality of life for U.K. citizens living in EU countries, where many choose to retire, such as Spain or the south of France.
Unless laws on civil rights are grandfathered in to the future relationship with the U.K., British citizens would lack consumer protections, access to justice and redress when they are traveling or living abroad. Non-EU citizens would not be entitled to such rights, and would find it more difficult to sue in EU courts, sources said.
“People underestimate the rights of the EU citizen,” said the senior EU diplomat. “You may have to go through diplomatic channels to defend your rights [if the U.K. leaves the EU].”
Brexit could also complicate judicial cooperation between Britain and EU nations. After a withdrawal, British citizens would no longer enjoy the right to automatic extradition back to their home country, as they do now.
When it comes to investment, Brexit could also have a major cooling effect. Currently, France is the second biggest investor in the U.K. behind the United States with 124 projects in 2015, accounting for the creation of 8,198 jobs, according to the British government. But French investors could quickly re-evaluate future involvement in the event of Brexit.
“Our major investors are very involved in Britain,” said Guigou. “I hope that Hinkley Point [a nuclear power plant project being led by France’s EDF in Britain] gets completed. But when it comes to other projects, French investors will look twice.”
Guigou also said a Britain-less EU would even try to take business away from the City of London financial district. “I can tell you there is already intense thinking about creating a financial hub on the continent,” she said.
Regardless of how Britain votes, Paris sees an interest in consolidating the European Union and ensuring that the bloc becomes more attractive for investors, and for its own citizens.
“We will need to make sure that at the political level, at the Commission and Council, we make proposals for the future of the European Union,” said Guigou. “Europe cannot continue as it’s going at the moment. Things need to change so that citizens recognize themselves in the project once again.”
The French talk tough but the EU has as much, if not more, to lose from playing hardball with the UK as they have to gain.
I think that what the French really fear is an Anglo-German renegotiation of how the EU works (in response to a Brexit vote) which would leave them on the sidelines while, at the same time, trying to head off a serious Euro-sceptical movement in their own country (the FN). The French have done very well out of the EU as it is. The last thing they want is to see it being reformed.
No-one is suggesting that trade will "suddenly disappear", rather that it will diminish because there is more red tape.
Suggest you plug "TPP" and "TTIP" into Google.
I know of TTIP and some of the documents have been leaked. There is a lot of disquiet about it in Europe and in the UK. The UK, in particular, is concerned about how TTIP might force privatisation of health care and of the NHS. It is also a trade deal which is being negotiated by the EU and the USA behind closed doors and which conforms many people's fears about the lack of democratic accountability within the EU.
I think the NPR piece misses one of the possible outcomes which is that the UK stays in the EU but the issues that the UK are concerned about such as access to benefits and the NHS for immigrants (rather than immigration itself) and democratic accountability in Brussels gets addressed.
What people forget is that the UK exiting is bad news for the EU. Look how hard the EU has tried to keep Greece afloat and they are still a basket case. Are they really going to just let their 2nd biggest economy and 2nd biggest budget contributor ride off into the sunset? I don't think so. I think it will simply trigger new negotiations followed by a new vote on an improved deal for the UK.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
