Goods In – Services Out: Can the UK Walk on One Leg?
01 October 2018
Dr Ingo Borchert is Senior Lecturer in Economics, and Dr Peter Holmes is a Reader in Economics, both are fellows of the UK Trade Policy Observatory.
The UK Government is currently proposing to the EU, broadly speaking, to adopt a common rulebook for goods. By contrast, not much if anything is sought in the realm of services, let alone movement of people or other areas of the Single Market. Part of the EU’s response has been that goods and services are so interlinked that one cannot have a goods only single market. Is this response just posturing as part of the negotiations process, or are there real issues with separating goods and services? […]
Briefing Paper 23 – NOT BACKING BRITAIN: FDI INFLOWS SINCE THE BREXIT REFERENDUM
The United Kingdom has historically been one of the main recipients of inward foreign direct investment (FDI), attracting more greenfield investment than other large European economies. However, the Brexit vote has introduced considerable uncertainty over the future growth potential of the UK market, and the ease of cross-border flow of goods and services. Following a peak of inward investment activity in early 2015, the number of FDI project announcements for the UK and the UK’s share of the European market for FDI have been falling.
In this Briefing Paper, we provide an analysis of inward FDI to the UK before and after the EU referendum, looking at the main foreign investors, which sectors they invest in and how trends in inward FDI have evolved over time. Our work suggests that following the Brexit vote, inward investment has been 16-20 per cent lower than it would have been if the UK had voted to remain a member of the EU, but that this impact differs depending on the sector.
Read Briefing Paper 23 – NOT BACKING BRITAIN: FDI INFLOWS SINCE THE BREXIT REFERENDUM
Would Canada-plus do the trick?
26 September 2018
L. Alan Winters CB is Professor of Economics and Director of the UK Trade Policy Observatory and Nicolo Tamberi is a Research Assistant in Economics for the Observatory
The brusque dismissal of elements of Mrs May’s Chequers plan at the informal meeting in Salzburg last week has stimulated feverish attempts to revive the case for a deep and special UK-EU Free Trade Agreement (FTA), under the title of a CETA-plus agreement. This effort received substantial reinforcement from the Institute for Economic Affairs’ paper of 24 September 2018. None of the discussion, however, has dealt seriously with the fact that an FTA will require the introduction of border formalities on UK-EU trade and that these will both violate the commitment to the absence of a border in Ireland and create serious congestion at those ports dealing with UK-EU flows, which will increase trading costs and cut trade with the EU. […]
Does the ‘Facilitated Customs Arrangement’ comply with WTO rules?
19 September 2018
Dr Emily Lydgate is a lecturer in Law at the University of Sussex and a fellow of the UK Trade Policy Observatory.
In its Chequers White Paper, the UK government has proposed that, in order to facilitate a frictionless border, it will operate a dual customs regime known as a Facilitated Customs Arrangement (‘FCA’). By replacing rules of origin checks at the EU-UK border with internal monitoring, the FCA requires firms to establish ‘robustly’ the destination of their products to ensure that correct duties have been applied, and then, if they wish, to seek rebates if they have been overcharged. Past UKTPO blogs have addressed logistical challenges and strategic downsides of this ‘Fantastically Complicated Alternative’ (see also Does the Chequers Agreement provide any steps to Brexit heaven?)
But would it be compatible with the rules of the World Trade Organization? The precise details of the FCA’s operation remain unclear. Barring a dispute, it’s not possible to settle the question definitively, but the FCA does prima facie pose a risk of WTO non-compliance. We presume that the UK government has undertaken some analysis of this, and […]
Briefing Paper 22 – THE ENGAGEMENT OF UK REGIONS IN MODE 5 SERVICES EXPORTS
The UK is one of the most services-oriented economies in the world, both in terms of production and exports. Services inputs embodied in manufacturing exports constitute an important but under-appreciated kind of services exports, so-called mode 5 services trade. This Briefing Paper provides the first estimates of mode 5 services trade disaggregated by UK region and industry, respectively, and over time. UK manufacturing exports entailed over £70 billion worth of domestic services inputs in 2017, which play an integral role in the competitiveness of UK manufacturing exports. Since these services are produced locally, changes in the trading environment for manufactures have direct implications for domestic employment in services sectors.
Read Briefing Paper 22 – THE ENGAGEMENT OF UK REGIONS IN MODE 5 SERVICES EXPORTS
Trading on ‘WTO Rules’ is NOT the best option: the treachery of growth rates
7 August 2018
Nicolo Tamberi is a Research Officer in Economics for the UK Trade Policy Observatory.
In a recent post on Brexit Central , Michael Burrage examines the growth of different countries’ exports to the EU12 over 1993-2015 and asks:
‘How can trading with the EU under WTO rules be the worst possible option when the exports to the EU of 15 countries which have been doing just that over 23 years of the Single Market have grown four times as much as those of the UK, despite all the tariff and non-tariff barriers they have faced?’
The answer is ‘easily’!
“Mamma Mia – here we go again” Equivalence for goods regulation in the Chequers proposal
3 August 2018
Dr Emily Lydgate is a lecturer in Law, Dr Peter Holmes is a reader in Economics and Dr Michael Gasiorek is a Senior Lecturer in Economics at the University of Sussex. They are all fellows of the UK Trade Policy Observatory.
In describing the future regulatory relationship between the EU and UK, the recent UK White Paper proposes the notion of ‘equivalence’ in some areas. This may seem like a mere technical requirement, but equivalence is a loaded word in trade policy circles, and the UK government’s reliance on it bears further scrutiny.
With respect to goods, ‘equivalence’ shows up in two main ways. First, the UK states that it will maintain equivalence (rather than exact harmonisation with EU regulation) for some food policy rules in the context of a […]
Tilting the playing field? The asymmetry in the UK and EU’s regulatory ‘ask’
27 July 2018
Dr Emily Lydgate is a lecturer in Law at the University of Sussex and a fellow of the UK Trade Policy Observatory.
The July UK White Paper on the future relationship with the EU calls for a ‘common rule-book’ for goods. This has sometimes been shorthanded as a proposal for a Single Market for goods (in contrast to services, which departs more dramatically from the status quo).[1]
But the scope of regulation the UK proposes should fall within this ‘common rulebook’ is narrower than what would be covered in a Single Market for goods – as the EEA Agreement demonstrates. It’s narrower even than that covered by the EU-Ukraine DCFTA Agreement.
So what does the common rule-book cover – and how might this match up with the EU’s regulatory ‘ask’ of the UK? […]
Decoding the Facilitated Customs Arrangement
23 July 2018
L. Alan Winters CB is Professor of Economics and Director of the Observatory and Julia Magntorn is Research Officer in Economics at the UKTPO.
There is much to digest in the White Paper on The future relationship between the United Kingdom and the European Union and much to clarify. This blog is devoted entirely to trying to understand the Facilitated Customs Arrangement (FCA) that aims to deliver frictionless trade in goods between the UK and the EU after Brexit.
The FCA matters because trade that is ‘as frictionless as possible’ with the EU is now accepted by nearly everyone as desirable and has been characterised by much of business as essential. It also matters in the short term, however, because it is the UK government’s offer to the EU on how to ensure that there is no border between Northern Ireland and the Republic. Without a solution to this latter problem there will be no Withdrawal Agreement and no transition. […]
Regulatory barriers likely to be contentious and most significant obstacles to UK-US trade
12 July 2018
Rorden Wilkinson is Professor of Global Political Economy and Deputy Pro-Vice-Chancellor at the University of Sussex and a Fellow of the UK Trade Policy Observatory. Charlotte Humma is Research Communications Manager at the Business School and Business Manager at the Observatory.
Standards and technical regulations are likely to be the most significant—and potentially contentious—obstacles to a UK-US trade deal according to leading trade experts.
Published today our latest briefing paper states that the UK faces a challenge in whether it stays with EU regulation, moves towards the US approach or tries a pick-and-mix approach of its own. […]
