COVID-19 and two key supply-chains
24 March 2020
Guest blog by Dr Sam Roscoe, Senior Lecturer in Operations Management and Research Leader for the Supply Chain 4.0 Hub at the University of Sussex.
COVID-19 has exposed a number of fundamental issues in grocery and pharmaceutical supply chains. The grocery sector has been particularly hard hit because of its ‘lean’ just-in-time delivery supply chain model, panic buying and labour shortages. Over the past two decades, the UK grocery sector has adopted the lean, just-in-time, supply chain model from the automotive sector. This rapid replenishment model focuses on minimizing inventory and delivering new products to store shelves as soon as a product is purchased at the tills. The advantages of this system are lower inventory carrying costs, reduced product handling and smaller store rooms. The disadvantage, as seen today, is that any unforeseen surge in demand makes it difficult for stores to quickly replenish shelves as inventory is not readily at hand. […]
Briefing Paper 39 – RECOMMENDATIONS ON THE UK GOVERNMENT’S GLOBAL TARIFF PROPOSALS
The UK left the European Union on January 31, 2020. As the UK Government begins to develop the UK’s independent trade policy for the post-transition period, one part of the preparations is to establish the UK’s independent tariff schedule that will apply to goods imported into the UK. In February 2020, the Department for International Trade launched a public consultation concerning the UK’s applied Most Favoured Nation tariffs. This briefing paper outlines the proposals under consideration, discusses their potential implications, and provides our recommendations on the issues that we believe are important for the UK Government to consider when formulating the UK’s trade policy going forward. We explore the structure of the UK’s MFN tariff as a member of the EU and then analyse the potential impact of simplifying the tariff structure for firms, households, the environment and domestic policy objectives.
Read Briefing Paper 39: RECOMMENDATIONS ON THE UK GOVERNMENT’S GLOBAL TARIFF PROPOSALS
Export-platform FDI and Brexit Uncertainty
14 February 2020
Nicolo Tamberi is a Research Assistant in Economics for the UK Trade Policy Observatory.
An important question arising from the UK’s decision to leave the EU is around the impact on foreign direct investment (FDI) in the country, with many academics and commentators suggesting that exiting the EU may accelerate the decline of British manufacturing.
Car manufacturers such as Honda and Toyota came to the UK in the 1980s with the aim of selling to the whole European market. While the car industry is often used as an example, other industries appear to be affected by uncertainty as well. Hiroaki Nakanishi, chairman of the board of Hitachi, wrote in the Financial Times: ‘We invested in [the UK] as the best base for access to the entire EU market’. The Japanese government’s letter to the United Kingdom clearly stated that for Japanese firms in the UK frictionless access to the European market is vital for their business. […]
US is No.1 country for UK small businesses to trade with over next three years
22 January 2020
With the UK set to embark on a new era of global trade negotiations for the first time in living memory, the importance of minimising friction in trade and having zero tariffs and quotas is more critical than ever to small businesses across the UK.
In conjunction with the Federation of Small Businesses, we have produced a new major report (see summary slides) highlighting what small businesses need to capitalise upon from Free Trade Agreements (FTAs).
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New UKTPO report outlines impact of Brexit Withdrawal Agreement on Welsh economy
20 January 2020
The Welsh Government has published an independent report completed by the UK Trade Policy Observatory analysing the potential implications for Wales’ external trade as a result of the protocol on Ireland/Northern Ireland, as set out in the Withdrawal Agreement.
The UKTPO analysis identifies issues that may impinge directly or indirectly on the Welsh economy as a result of the adoption of the Protocol on Ireland/Northern Ireland as part of the Withdrawal Agreement and subsequent Bill. […]
Determining goods at risk
14 January 2020
Dr Anna Jerzewska is a independent customs and trade consultant, an independent advisor with the UN International Trade Centre and also a trade policy and customs consultant for the British Chambers of Commerce.
The UK is due to leave the EU on the 31st January 2020. A new stage of the Brexit process is set to begin – the transition period and negotiations of the future relationship with the EU. At the same time, work on the Northern Irish border arrangements is far from over. A newly established Joint Committee will negotiate the practicalities of implementing the Withdrawal Agreement.
Under the Withdrawal Agreement (“WA”), Northern Ireland would stay in the UK’s customs territory but would at the same time continue applying EU’s customs legislation, tariffs, quotas and, partially, EU Single Market rules. This will avoid a border on the island of Ireland but will mean a de facto customs and regulatory border in the Irish Sea. As a result of this dual status, goods shipped from Great Britain (“GB”) to Northern Ireland (“NI”) will be subject to EU tariffs if they are “at risk of subsequently being moved into the Union, whether […]
How much is a Free Trade Agreement with the US worth to the UK economy?
12 December 2019
Michael Gasiorek is Professor of Economics at the University of Sussex and a Fellow of the UK Trade Policy Observatory. Nicolo Tamberi is a Research Assistant in Economics for the UK Trade Policy Observatory.
Following Brexit, and assuming the UK is no longer part of a customs union with the EU, the UK will be able to sign free trade agreements (FTAs) with third countries. Indeed, the Conservative manifesto aims to have 80% of UK trade covered by FTAs within three years. This is clearly unrealistic, because it would require signing agreements with more than 12 countries within a time-scale which has rarely been achieved for a single agreement. The objective, however, highlights that, post-Brexit, there will be a lot of focus on trying to sign FTAs. Other than the somewhat significant matter of signing an agreement with the EU, top of the UK’s FTA wish list is an agreement with the US. […]
Parties’ election promises on trade are incoherent and unachievable
11 December 2019
In the lead up to the General Election, we have analysed the manifestos of the five main political parties and what they imply for future UK trade.
Overall, we find that the manifestos in this General Election are incoherent and vague on trade and contain several unachievable targets. […]
EU tariffs could cover 75% of imports of goods into Northern Ireland
9 December 2019
L. Alan Winters CB is Professor of Economics and Director of the Observatory.
Our analysis finds that under the UK-EU Protocol on Northern Ireland, about 75% of Northern Ireland’s imports of goods from other locations, including Great Britain, would be subject to EU tariffs on their arrival in Northern Ireland. This is not easily reconciled with the government’s assertion that Northern Ireland remains within the UK customs territory. […]
Get Brexit done: An oven-ready Brexit?
4 December 2019
L. Alan Winters CB is Professor of Economics and Director of the Observatory.
The Prime Minister seems to think that an ‘oven-ready’ Brexit deal is the best that we can choose from the menu of policy alternatives. It sounds neither appetising nor nourishing, but if it really were quick and easy, maybe it would be worth it.
But it’s not quick or easy: ‘oven-ready’ is just not true. […]
