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I've been looking at back-of-envelope numbers for the Tory manifesto's "aim" to have free trade deals cover 80% of UK trade within 3 years
.
It's an extremely ambitious call
1. Total UK trade (goods+services) 2018 = £1,289 billion
2. Goods = 65%
3. 80% of total = £1,038bn
1/7 https://twitter.com/CoppetainPU/status/1198655174249795586
.It's an extremely ambitious call
1. Total UK trade (goods+services) 2018 = £1,289 billion
2. Goods = 65%
3. 80% of total = £1,038bn
1/7 https://twitter.com/CoppetainPU/status/1198655174249795586
The Tories aim to have free trade deals cover £1,038bn of UK trade, more than UK goods trade alone.
4. A goods-only FTA with the EU would cover £545bn of that (smaller if regulations diverge but let's keep it simple), leaving just under £500bn to be covered by non-EU deals
2/7
4. A goods-only FTA with the EU would cover £545bn of that (smaller if regulations diverge but let's keep it simple), leaving just under £500bn to be covered by non-EU deals
2/7
5. Trade in goods with the US, Australia, NZ (mentioned in the manifesto) plus Canada, Japan & China totals about £150bn
Leaves £350bn more to meet the 80% target, even assuming a free trade in goods with China can be done in 3 years (no one thinks it can, even in 5-10 yrs)
3/7
Leaves £350bn more to meet the 80% target, even assuming a free trade in goods with China can be done in 3 years (no one thinks it can, even in 5-10 yrs)
3/7
6. Clearly these free trade deals would have to include services to meet the 80% target.
The best case is continued UK-EU trade in goods and services = £648bn (that's no longer a basic UK-EU deal, so no way of doing it by end of 2020)
4/7
The best case is continued UK-EU trade in goods and services = £648bn (that's no longer a basic UK-EU deal, so no way of doing it by end of 2020)
4/7
7. To meet the 80% target, UK deals with non-EU countries would have to cover about £400bn of trade. Goods-only deals with US, AUS, NZ, CAN, JAP, CHN would only cover £150bn.
8. Add Norway, Switzerland, etc and goods-only deals would still fall short.
5/7
8. Add Norway, Switzerland, etc and goods-only deals would still fall short.
5/7
9. So there will also have to be meaningful agreements in services with major non-EU trading partners to meet the 80% target. And the goods deals would probably also need content on regulations, recognition, etc.
We are now talking about much more complicated deals.
6/7
We are now talking about much more complicated deals.
6/7
10. Remember the calculations include China, which we should probably rule out.
11. Negotiating a whole raft of complex free trade agreements with the EU and non-EU partners SIMULTANEOUSLY in 3 years is almost certainly impossible
(Yes, these were back-of-envelope numbers)
7/7
11. Negotiating a whole raft of complex free trade agreements with the EU and non-EU partners SIMULTANEOUSLY in 3 years is almost certainly impossible
(Yes, these were back-of-envelope numbers)
7/7
P.S. A big problem is the meaning of "covered by free trade agreements".
Most people will assume it means the agreements will apply to 80% of UK trade.
It's not the same as saying "deals with countries accounting for 80% of UK trade". Most deals don't apply to all trade.
Most people will assume it means the agreements will apply to 80% of UK trade.
It's not the same as saying "deals with countries accounting for 80% of UK trade". Most deals don't apply to all trade.
Great minds, etc https://twitter.com/DomWalsh13/status/1199371181796839425?s=20
Here's the article and a screenshot of the section on trade
https://openeurope.org.uk/today/blog/what-do-the-parties-election-manifestos-say-about-brexit/
Details in this pdf file: …http://2ihmoy1d3v7630ar9h2rsglp-wpengine.netdna-ssl.com/wp-content/uploads/2019/11/Manifesto-blog.pdf
https://openeurope.org.uk/today/blog/what-do-the-parties-election-manifestos-say-about-brexit/
Details in this pdf file: …http://2ihmoy1d3v7630ar9h2rsglp-wpengine.netdna-ssl.com/wp-content/uploads/2019/11/Manifesto-blog.pdf
