Brexit

But I seriously doubt that we will ever come close to be a net exporter to the EU, America, China or Japan and we'll therefore always likely be the weakest currency and always importing more (at a greater cost) than we might export (theoretically a bit cheaper)

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Originally Posted by Fellbeast

But I seriously doubt that we will ever come close to be a net exporter to the EU, America, China or Japan and we'll therefore always likely be the weakest currency and always importing more (at a greater cost) than we might export (theoretically a bit cheaper)

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I agree. We need to improve our country in terms of manufacturing.

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Originally Posted by Stagger

I agree. We need to improve our country in terms of manufacturing.

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But Boris and Dominic don't want to do that do they?

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Originally Posted by Fellbeast

But Boris and Dominic don't want to do that do they?

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Thatcher started it.

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Originally Posted by Muddy Retriever

I would say the reverse is true. UK exporters will have to face tariffs on their goods making them more expensive but this will be offset by a declining currency making their goods cheaper. EU exporters meanwhile will face a double whammy, the appreciating value of the euro will make their goods more expensive and this will be exacerbated by tariffs on top.

A declining currency is a double edged sword. It's good for exporters but potentially inflationary for consumers. Obviously UK customers will have to pay more for imports. However the Exchequer will get the benefit of collecting all that tariff income and since as you point out, we import more from the EU than we sell to them, there will be more tariff money coming in than going the other way.

Under WTO rules, a country can reduce or eliminate tariffs as long as it does not discriminate i.e. the same tariffs apply to all countries. So it might be useful to eliminate tariffs in some areas like certain foods that the UK doesn't produce itself in order to reduce the price the consumer pays. In the past the UK has been obliged to apply hefty tariffs on food stuff from countries outside the EU, thereby making it very expensive. It could chose now to no longer do so.

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the reverse is true and it goes something like this.

Duty on cars is 10%.

A Honda made in Swindon sold to a dealer in France will go up 10%.

A Citroen made in Rennes sold to a UK dealer will also go up 10%.

That is assuming we do not have an FTA of course.

If the £ drops against the Euro by say 10% then the Honda in France stays at the same price it always was, but the Citroen in the UK goes up by 20%.

Of course it gets more complex because on all sides of the equation the supply chain involves quite a bit of back and forth, but then those components can be handled duty free if they are being re-exported and that often happens now.

The key will be Government policy - the free ports for example could be very significant - but the way the Government have handled the last couple few months I'm not sure they have the capacity to manage policy as well as I had hoped.

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Originally Posted by Fellbeast

But Boris and Dominic don't want to do that do they?

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That was the whole idea of the Free Ports policy put forward at the General Election.

https://www.cps.org.uk/research/the-...ade%20value%20.

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Originally Posted by Fellbeast

But I seriously doubt that we will ever come close to be a net exporter to the EU, America, China or Japan and we'll therefore always likely be the weakest currency and always importing more (at a greater cost) than we might export (theoretically a bit cheaper)

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The UK is a net exporter to the USA already and does have a trade surplus overall with non-EU countries.

The EU runs a massive surplus with the UK, that is true. I would expect to see that decline going forward. With a no-deal Brexit they will lose the advantage they have had over the rest of the world of tariff free trading. In fact it will be even worse if the UK agrees trade deals with other countries as it has with Japan.

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Originally Posted by Muddy Retriever

The UK is a net exporter to the USA already and does have a trade surplus overall with non-EU countries.

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Not according to America we’re not 😊

https://ustr.gov/countries-regions/e...united-kingdom

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Originally Posted by Marco

Amongst all this, did anyone else notice we'd signed our first post-Brexit trade deal following an agreement with Japan?

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We already had a great trade deal with Japan as part of the EU though. But fair play, one down after 4 years - crack on and we might have two by 2024 :)

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Originally Posted by Fellbeast

We already had a great trade deal with Japan as part of the EU though. But fair play, one down after 4 years - crack on and we might have two by 2024 :)

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We weren’t allowed by the EU to negotiate any trade deals until we’d left so make that a little more than 7 months.