Category Archives: Brexit

As self-styled Dishy Rishi Sunak rolls his one-man show into the Commons tomorrow, he will make a few spending announcements for some good news headlines, and seek to blame Covid for all the bad news about the state of the economy.

But dont be fooled. This is the ABCD Budget A for Austerity. B for Brexit. C for Covid. D for the Deceit the Chancellor will deploy in the hope that all the focus is on C, not A and B.

Of course the pandemic has delivered a huge blow to the economy, with so many lockdown-hit businesses hit hard, meaning lower tax revenues and higher unemployment, government picking up the tab for the furlough scheme which eventually will go, the NHS needing huge sums to cope with the additional demands placed upon it oh, and the billions spaffed on Tory friends and donors for schemes for which they are not remotely qualified.

But Austerity under David Cameron and George Osborne laid the ground, its consequences an NHS always struggling to cope, from the PPE shortages that gaslighting Health Secretary Matt Hancock now claims never existed, the staff shortages that forced doctors and nurses to work themselves into ground for lots of Johnson-Symonds-Sunak claps on the steps of 10, and 11 Downing Street, but no pay rise; or the need to shovel people into care homes to create bed space in hospitals.

What is your view? Have your say in the comments section

Meanwhile Brexit is fast becoming the most gigantic elephant in the political room.

Though both frontbenches stress the strength of the economy as key to the fulfilment of all other promises, neither seem willing to put the GDP-whacking economic cost of Brexit centre stage the Tories because it exposes the folly of the whole project, and the lies on which it was won, and Labour because they dont want Brexit supporters to think the Party has not accepted Brexit has been done, and cannot be undone.

But it makes a total mockery of Sunaks weekend claim that he would level with the British people about the state of the economy.

It is no more credible that the other trite phrase we keep hearing fall from Tory lips - levelling up.

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How can you even claim to be levelling with the British people unless you admit that Brexit is already damaging the economy, with the only argument outstanding the exact percentage fall in GDP that it is going to inflict.

Red tape they said would be cut has massively increased and is driving many businesses to the wall; checks and tariffs Boris Johnson denied would exist are now real; and a border in the Irish Sea Johnson denied would come about - even after signing the Treaty that confirmed it - is endangering both prosperity and peace in Northern Ireland, and possibly the Union of the UK.

And even on C for Covid, though Sunak will repeat more trite lines about putting his arms around the whole country, the harsh truth is that the economic cost has been massively increased by the governments failure to get on top of this crisis when it first emerged.

We have had more and longer lockdowns than those countries that took it seriously from the off, and in addition to the tens of thousands Johnsons denialism, exceptionalism and laziness killed, this has deepened the economic harm too.

I hope in his response to Sunak that Labour leader Keir Starmer reminds this shower of charlatans what was happening inside government exactly one year ago.

A year ago yesterday, Johnson finally attended a COBRA crisis meeting, having missed the first five, preferring instead a two-week holiday to sort out the mess of his private life.

But much of the meeting was taken up with ministers congratulating him on his news he was having another child, and marrying (Ill believe it when I see it) Carrie Symonds.

As for any policy decisions no lockdown, lets get to work on a speech saying Britain will stand up to Covid without closing the economy; lets get ready for Cheltenham; let shake hands and stick two fingers to the virus.

They have destroyed lives. They have destroyed livelihoods. And Sunak, one of the radical right who always saw Brexit as the route to a low tax (for the wealthy), low regulation, anti-welfare, anti-internationalist revolution that even Margaret Thatcher stopped short of, will now try to use Covid as the cover to bring in cuts and changes they wouldnt dare have fought an election on.

They used post-crash Austerity to make cuts they wanted to make. Theyre using Brexit to further their right-wing vision.

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Theyre hoping Covid means nobody will mind or notice too much, and by the time it is all done, as with Brexit, it will be too late to be undone.

That is why the D for Deceit is so central to their plan.

ABCD. Austerity. Brexit. Covid. Deceit.

A. Big. Conservative. Disaster.

Dont say you werent warned.

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'This is the ABCD Budget - Austerity, Brexit, Covid... and Deceit' - Mirror Online

An increasing number of EU countries are breaking away from the Brussels vaccines strategy and, according to The Telegraphs Europe Editor James Crisp, it represents an embarrassment for the European Commission.

In a video analysis of the the bloc's crumbling unity, he said: They say here in Brussels all the time that the answer to any crisis is always more Europe.

What's embarrassing for the European Commission right now that there's an increasing number of countries who think that the answer to getting more vaccines quickly is actually less Europe or no Europe at all.

It will do little to convince countries to hand over more power to the EU, he adds, such as on health policy.

Watch the video above for a comprehensive take on the EU's vaccine rollout problems.

For more videos from the Telegraph, subscribe to our YouTube channel.

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Watch: Why the EU vaccine crisis is showing others the benefits of Brexit - Telegraph.co.uk

Albert Sanchez-Graells reflects on the governments proposals for the post-Brexit reform of public procurement law. Contrary to the goals of simplifying the system to foster innovation and value for money, he argues that the deregulatory proposals are likely to overcomplicate the system and increase the administrative burden.

Until recently, public procurement law and practice have rarely been at the forefront of public and political debates. The UK governments procurement reaction to the pandemic continues to generate scathing reportssuch as the most recent one on PPE procurement by the House of Commons Public Accounts Committeeand the emerging lessons show the need to strengthen this area of public governance. Against this background, it is timely to reflect on the governments recent proposals to reform public procurement law in the Green Paper Transforming Public Procurement.

The Green Paper is presented as an historic opportunity to overhaul [the UKs] outdated public procurement regime, a dividend from the UK leaving the EU, and sets out to deliver a much-touted bonfire of procurement red tape. The Green Paper is ambitious, seeks to transform procurement law and practice, and contains proposals that would alter a broad array of key elements of procurement regulation, such as procedural requirements, checks on the exercise of commercial discretion, or the oversight and avenues for legal challenge.

There are some useful proposals in the Green Paper, such as those seeking to ensure the timeliness of mandatory disclosures; the creation of a centralised information platform based on open contracting data standards and principles; an aspiration to enhance access to legal challenges with a focus on pre-contractual remedies rather than damages pay-outs; or more robust rules for the modification of contracts during their execution.

But there are also several major omissions for a document seeking to establish a comprehensive view of procurement law and the underpinning administrative architecture, such as the desired level of centralisation, cooperation, and specialisation of public buyers; the need to adopt a technologically robust platform for full cycle e-Procurement; or the interaction of the new rules with the possibility of deploying digital technologies to automate and enhance procurement governance.

A close analysis of the Green Paper reveals that there is very little truly innovative in its proposals. The paper is bizarrely EU-centric and, with some limited but clear exceptions concerning the reform of procurement procedures, most of the changes advocated are either a small tweak or correction of the current ruleswhich the UK had simply copied-out from EU lawor policy positions that could have been adopted under EU law. In other words, there is very limited or no Brexit-related dividend to be reaped through the implementation of the Green Paper.

More importantly, its implementation would not only not be transformative, but also result in an overcomplicated regulatory infrastructure. The Green Paper seeks to create a principles-based regulatory model with minimalistic statutory requirements and a significant offloading of detailed rules onto guidance, which enforceability generates significant legal uncertainty. In seeking to minimise the scope of statutory regulation and exponentially increase the volume of guidance, the Green Paper would not only not reduce the overall regulatory burden, but also create risks of rule dispersion, regulatory opacity and complexity.

To boost the exercise of commercial discretion, the paper also seeks to create limited but clear exceptions to its most crucial constraints, such as the requirements for contracts to be awarded based on the most economically advantageous tender, or the prohibition on the imposition of requirements not linked to the subject matter of the contract. The Green Paper does not formulate those exceptions but refers to future guidance. Unavoidably, a system based on rules and (limited) exceptions will generate more legal uncertainty than the current system. Such legal uncertainty could hardly contribute to an improvement upon the current situation.

Moreover, the proposals concerning the reform of the available tendering procedures would also create significant additional administrative burdens for both public buyers and economic operators. In seeking to create maximum flexibility for public buyers, the Green Paper effectively authorises them to create their own procurement procedure every time they tender a contract, which would immensely raise the administrative burden for public buyers unwilling to use but the most basic of procurement procedures, as well as raise the transaction and compliance costs for tenderers. The procedural complexity that would result may be suitable for extremely high-value and complex procurement procedures, but it seems that the Green Paper has sought to create a system of premium regulation that would be inadequate for most procurement procedures.

Further, the Green Paper would create tensions and contradictions in the oversight and legal challenge model. On the one hand, it aims to ensure that the new regulatory framework drives a culture of continuous improvement to support more resilient, diverse and innovative supply chains, and to establish a more innovation-friendly culture as well as practices among contracting authorities. Clearly, this could only happen if the regulatory system were one which created some room for experimentation, some tolerance for errors, and rewards for those embracing the new culture. On the other hand, the Green Paper seeks to make a future [legal] review system quicker, cheaper and therefore more accessible to suppliers, with decreased impact on delivery of public services. In that context, it is easy to see how the higher likelihood of legal challenge can create negative incentives for public buyers, which may be unwilling to experiment and innovate.

Another of the shortcomings of the Green Paper is the lack of governmental commitment to the proper and sustained funding of the training programme required to support its rollout. Although it recognises that the proposed reforms will not in themselves deliver unless contracting authorities act to ensure their commercial teams have the right capability and capacity to realise the benefits, the provision of a programme of training and guidance on the reforms is subject to future funding decisions. Arguably, the implementation of the proposals should be made conditional upon a binding commitment to a sufficient level of investment in training, in particular in the context of the uncertain economic circumstances ahead of us. Without such a firm commitment, the implementation of the Green Paper reforms would, at best, have little to no practical effect and, more likely, result in an increased burden for all agents involved, which would further erode the commercial capabilities in the public sector.

On the whole, the proposals are largely antithetical to its stated goals to speed up and simplify [UK] procurement processes, place value for money at their heart, and unleash opportunities for small businesses, charities and social enterprises to innovate in public service delivery. A substantial rethink is needed if the Green Papers goals are to be achieved and, more broadly, if the post-Brexit reform of UK public procurement is to deliver stronger accountability and governance mechanisms for this important area of expenditure of public funds, which is likely to become instrumental in delivering post-pandemic economic recovery plans.

___________________________________

Note: the above draws on the authors article available here, to be published in the European Procurement & Public Private Partnership Law Review.

About the Author

Albert Sanchez-Graells is Professor of Economic Law and Director of the Centre for Global Law and Innovation, University of Bristol Law School.

Photo by Cytonn Photography on Unsplash.

Link:

Why the proposed post-Brexit procurement reform may not achieve the transformation it intends - British Politics and Policy at LSE

Andreas Prott

DAP (delivered at place) incoterms are the principal cause of delays in the aftermath of Brexit, according to Europa Worldwide MD Andrew Baxter.

Mr Baxter acknowledged the new EU-UK trading relationship had been incredibly tough for everyone, but said he remained convinced Europa had made the right call in adopting the delivered duty paid (DDP) model, as it mitigated many of the issues seen at borders.

While the implementation of this new product was more difficult than we expected, with a very challenging first six weeks, the product is now working very effectively, he said.

Export consignments are being delayed in our hub by around 24 hours while anticipated declarations are submitted, but beyond that they are more or less moving as normal; well be working over the next three weeks to remove the delays altogether.

Since the end of the transition period, a number of logistics operators have noted border officials using an inconsistent approach in applying the new rules.

Groupage loads have been particularly exposed to this problem, with food and drink shippers becoming increasingly wary of deliveries, for fear of one item within the load causing the entire shipment to be delayed, resulting in spoilage.

And sources in the automotive sector have spoken of near-identical shipments leaving the same factory but disembarking through different ports, one stopped, the other let through.

Mr Baxter told The Loadstar: Market disruption to groupage is principally caused by DAP shipping terms and the need for the receiving hub to contact the importer, establish a commercial relationship and get them to pay VAT, duty and customs fees prior to delivery.

This issue is creating massive backlogs in all groupage networks and is far and away the biggest issue.

Europa made significant investments in the run-up to Brexit: 2m in its Dartford transit warehouse, which increased capacity by 75%; as well as spending 3m on consultants, IT, recruitment, and training; and launching its DDP product, Europa Flow.

Under DDP, sellers take full responsibility for export and import formalities, transport, duties and taxes, which Mr Baxter said made it just as easy to buy from the UK as before Brexit.

Its been really tough, but it is now working. I firmly believe we now have the quickest and most reliable service in the market.

However, one source questioned the long-term viability of Europa Flow, telling The Loadstar it was reliant on a loophole within European regulations that would likely be closed.

But Mr Baxter said: Regime 42 is not a loophole, it is a standard EU process that has been in place for many years and is used to facilitate billions of euros of trade each year of non-EU imports into the EU.There is no reason to think this process will be changed in the near future.

The European Commission explained in an FAQ document published in January that Customs Procedure 42 (CP42) was a simplification procedure that provides for a deferral of paying import VAT on goods cleared upon arrival into the EU It can be used when goods being imported from outside the EU (eg, from GB) into an EU member state are subsequently being sold on to a company in another EU member state (ie an intra-community supply).

It added that the application of the customs procedure 42 and its requirements may vary according to the member state of importation concerned Imports into Northern Ireland can still benefit from the CP42 procedure if followed by an intra-community supply.

Read this article:

News / Finding the way through delays from a maze of post-Brexit red tape - theloadstar.com

With the collapse of international travel throughout the pandemic, combined with the Brexit rhetoric of taking back control, it might seem counter-intuitive to suggest that recent events have left workers more vulnerable to exploitative practices but this is exactly what happened in 2020.

The COVID-19 crisis has hit the labour market hard, with huge numbers of workers worldwide expected to lose their livelihoods, which has resulted in the most vulnerable become susceptible to modern slavery. During the first lockdown, construction was responsible for more suspected modern slavery cases than any other industry.

Unseen UK, the UKs leading charity on modern slavery, revealed 57 cases with 209 potential victims had been reported to its national helpline up 12 per cent on the same period in 2019.

The Biffa case serves as a reminder that slavery can even occur in companies where all the correct policies and procedures appear to have been implemented

At the same time, Brexit has exacerbated the risk of exploitation, with confusion over the UKs new points-based immigration system and the status of EU nationals creating a backdrop ripe for misinformation and intimidation.

This lack of clarity creates an environment where even those who manage to escape trafficking withdraw from society as far as possible out of fear over their rights and the risk of being deported. This makes them ideal candidates for re-exploitation.

There is a serious misconception that Brexit and the implementation of new border controls will cut down the amount of trafficking. But leaving the EU meant surrendering real-time access to European security systems, leading to what Unseen UK has labelled a downgrading of our ability to intercept traffickers. And exploitation is not restricted to foreign workers. Between July to September 2020, UK nationals accounted for the largest proportion of victims (35 per cent).

We urgently need to fight the myth that modern slavery is something that happens in countries far away and unlike our own. The news that Biffa an established household name and founding member of the Slave Free Alliance is being sued by three victims of modern slavery should serve as a stark warning to us all and raises troubling questions regarding what is going on in other businesses, and particularly smaller firms, away from the public gaze.

While public sector employers are much more aware of the issues, imposing obligations on their supply chains under the Modern Slavery Act, it has been reported that exploited workers are more likely to be concentrated in smaller residential schemes.

The Biffa case highlights that this is not just an ethical conundrum for businesses, but an emerging commercial risk too. The action against Biffa should encourage companies to start taking the responsibility to prevent forced labour within its workforce more seriously, for fear of the reputational damage that could come from similar lawsuits.

Its vital that as an industry we continue to raise awareness of this issue and the steps businesses can take to protect their employees, those they contract, and also their own commercial interests. A thorough understanding of the construction supply chain is an important start, including taking time to impose regular checks on recruitment and payment practises. The Biffa case serves as a reminder that slavery can even occur in companies where all the correct policies and procedures appear to have been implemented, so identifying potential weak points is a crucial aspect of protecting vulnerable workers.

Communication with staff is also important. This can increase awareness of the signs of modern slavery and create a culture where people feel comfortable reporting malpractice, helping to tackle these issues head on.

While COVID-19 and Brexit may have heightened the potential for exploitation in construction, this does not detract from our responsibility as an industry and society not to turn a blind eye to economic migrants who support our economy. Only by staying alive to the risks and working together to raise awareness of the signs of modern slavery can the industry put a stop to the exploitative practices that have escalated during the last year.

Joanna Rees is a partner in the construction team at Blake Morgan LLP

The rest is here:

COVID and Brexit have increased the risk of slavery it's time to fight back - Construction News

The Scottish Salmon Producers Organisation (SSPO) has published figures showing the losses incurred to the sector which produces the UKs top food export because of the extra paperwork, the new layers of bureaucracy, the delays and the confusion caused by the end of the Brexit transition phase.

The publication coincides with the second meeting of the UK and Scottish government joint task force on seafood exports, a task force which was set up at the urging of the SSPO.

The figures published today were presented to the task force this morning by Tavish Scott, chief executive of the SSPO.

Since January 1 2021, when the UK left the Brexit transition phase and exporters had to deal with the full effects of not being in the European single market, salmon farmers have experienced considerable delays, some of which have resulted in lost orders, failed deliveries, unharvested fish and heavily discounted products at market.

The sector has experienced an immediate loss of sales to the tune of 1,500 tonnes of product.

Scotlands salmon farmers prepared extensively for the changes and allocated additional resources to maintain the smooth and efficient supply process it previously enjoyed.

Scottish salmon farmers have also had no choice but to delay harvesting 700 tonnes of fish in order to minimise any of their high-quality product becoming spoiled or destroyed.

The sector has experienced various increasing costs which are unrelated to production, amounting to 200,000 in January alone. Such overheads are the cumulative result of additional export documents and resources, logistics costs, administrative and veterinary costs, and through lost custom as a result of reduce confidence in the supply timeline.

Scott said: This cannot be the new normal. Our members cannot guarantee reliable delivery times to the European Union, which is our biggest overseas market. The systems need to be streamlined and a lighter touch adopted on all sides to make sure we can continue to serve our European customers as we have in the past. If not, they will go elsewhere and we will lose both trade and customers.

The Health and Welfare of Atlantic Salmon course

It is vital that fish farm operatives who are responsible for farmed fish are trained in their health andwelfare. This will help to ensure that fish are free from disease and suffering whilst at the same timepromote good productivity and comply with legislation.

We are calling on both the UK and Scottish governments to work together with us and with the supply chain to make sure there are no more blockages in the system which prevent our members from getting their fish to market on time.

See the article here:

Scotland's salmon farmers count the cost of Brexit - The Fish Site

Shadow chancellor Anneliese Dodds has accused the government of furiously trying to manage expectations down over its post Brexit trading arrangements for financial services.

Ahead of Rishi Sunaks Budget,the Labour frontbencher said she was particularly concerned over the uncertainty surrounding the memorandum of understanding with the EU for the sector.

There was she added a need to see much more ambition from the Conservatives with one in every 14 UK workers, employed in financial or related professional services.

With the response to the coronavirus pandemic expected to dominate the chancellors statement to MPs, Dodds claimed the government seem to have been focused on a strategy of extrication over support for businesses and jobs.

The MP for Oxford East called on the government to go beyond the gimmicks around the challenges that young people face, arguing the chancellors flagship Kickstart Scheme aimed at helping the young unemployed sadly is failing.

Speaking to the PA news agency, Dodds said: Well I have to say Im particularly concerned about those aspects of our future trading relationship with the EU which havent yet been battened down by government.

Theyre meant to be concluding a memorandum of understanding with the EU 27 for trading arrangements for our financial and related professional services, now okay weve been told we cant have a running commentary around those arrangements, but it seems like the Conservative government is furiously trying to manage expectations down around what such a memorandum of understanding might include.

She added: Now we need to see much more ambition for financial services coming from the Conservative government. Actually one in every 14 UK workers, work in financial or related professional services, most of them outside London and yet we seem to see very little engagement from government around that issue.

We also sadly dont seem to have yet from government that clarity about whether theyll be ready, especially for the new changes to customs thatll be coming through in the summer. Ive warned for many months about the lack of customs officials and agents compared to what government promised would be in place by now.

Dodds said businesses had been calling for weeks and weeks for certainty around things like the business rates holiday extension and clarity over the furlough scheme.

She said: Well unfortunately the Conservatives seem to have been focused on a strategy of extrication, they seem to have been desperate at every moment to remove themselves from existing commitments, rather than planning for the future.

Amid reports the chancellor is considering freezing income tax thresholds for at least three years, Dodds said that on potential tax changes, Labour would need to look at any very carefully, adding: Certainly when the threshold for income tax has been increased thats had more of a positive impact on those who were better off than on those who were worse off.

She said: Above all we need to see a Budget thats focused on promoting jobs and business and livelihoods, not one thats actually hammering family finances as the chancellor seems to be doing at the moment.

She added: Not protecting jobs and businesses in that way will then have a negative impact on the public finances because well see less tax revenue coming in and I think government has got the balance wrong around this, they seem to be really taking their eye off the need to get people back into work, to keep people in work, to give businesses the confidence to keep going.

Instead they seem to be very much focused potentially on party political issues, how quickly they could get any tax changes through, thats not whats needed for our economy right now.

The government, she said, had done nothing about the situation with loans that particularly small businesses may have taken on.

Link:

Whitehall 'trying to manage expectations' over Brexit memo - The New European

Matthew Elliott, political adviser to Shore Capital

Matthew Elliott, political adviser to Shore Capital

Matthew Elliott, former chief executive of Vote Leave, the campaign group that in 2016 persuaded just enough UK voters they would be better off outside the EU, explained on Wednesday that the country now needs to think about the tangible benefits of Brexit to its financial services industry.

Elliott is now a political adviser to Shore Capital, the investment group whose founder Howard Shore is a prominent backer of the UKs Conservative party and supporter of Brexit.

Elliott offered his thoughts alongside Shores non-executive chairman Xavier Rolet, former head of the London Stock Exchange, and research chief Clive Black.

Sadly, those tangible benefits arent immediately obvious anywhere in their 2,800 words.

The three admit that whilst the question is quite straightforward, the answer is more involved, multi-faceted, multi-agency and multi-lateral.

It sounds like one of those games of 3D chess Elliotts old pal Dominic Cummings used to enjoy, possibly even a 4D game.

Apparently,

Continued here:

Euromoney Finance: The tangible benefits of Brexit - Euromoney magazine

The government talks of teething troubles, but the red tape is here to stay

Feb 24th 2021

TWO MONTHS after Britain left the single market and customs union in favour of a trade and co-operation agreement (TCA), complaints are multiplying, from seafood sellers and pork exporters to fashionistas and musicians. Some of these are teething problems, but most are the consequence of Boris Johnsons decision to prioritise sovereignty over market access.

The biggest political problem is the Northern Ireland protocol, under which the province stays in the single market for goods and the customs union. The government chose this route as an alternative to a hard border on the island of Ireland. But now that border checks have begun, disrupting trade, the Democratic Unionist Party and some Tories are demanding that Mr Johnson should scrap the protocol entirely. He will not do that, but the protocol will be an issue in the elections next year to the Northern Ireland Assembly.

Trade across the channel is suffering even more. The British Chambers of Commerce report that almost half of exporters to the EU have met obstacles. Although the TCA promises zero tariffs and quotas, that is subject to rules-of-origin requirements to ensure that exported goods are not first imported from outside the EU. Rules of origin have hit businesses from supermarkets to pet foods to fashion designers. Strict sanitary rules are similarly obstructing exports of shellfish and many agrifoods. Daniel Kelemen, a politics professor at Rutgers University who is collating examples of Brexit trade barriers on Twitter, had by this week recorded nearly 200 cases.

Services are no better, mainly because the TCA omits them. The City of Londons hopes of retaining business across Europe through a grant of regulatory equivalence have evaporated. Instead, the EU crows about Amsterdam unseating London as the continents largest share market. Musicians, actors, fashion designers and professional-service firms are griping about expensive red tape and travel restrictions. A provisional decision to accept the adequacy of Britains data-protection standards is a rare ray of hope, and even this may be challenged in court.

The chances of reducing these barriers are small. Mujtaba Rahman of the Eurasia Group consultancy says there could be improvements at the margin, but anything substantial (such as Britain aligning with EU sanitary standards) would require Mr Johnson to cross his sovereignty red lines. The promotion of Lord Frost, the hardline negotiator of the TCA, to replace Michael Gove as minister in charge of EU relations, does not augur compromise. Nor does the row over the EUs ambassador in London, to whom the Johnson government (alone in the world) refuses full diplomatic status. Vaccine wars, even if only rhetorical, do not help.

The cost of Brexit may take time to emerge. Tom Sampson of the London School of Economics notes that the first goods-trade numbers for January will be known in mid-March. He thinks what he sees is consistent with the modelling of the TCA he did for UK in a Changing Europe, a think-tank, which points to a fall over ten years in British exports to the EU of 36% and in incomes per head of 6%, bigger than the impact of covid-19. There could be offsets from trade deals with third countries or regulatory divergence, but they are far off and uncertain.

Unusually for a big trade deal, the government refuses to conduct an impact assessment of the TCA, doubtless because it would produce negative results. Dominic Raab, the foreign secretary, says the benefits of Brexit will not emerge for ten years. He should recall the case of Switzerland, which after a narrow referendum loss turned its back on the single market in 1992. Over the following decade the Swiss economy grew more slowly than any EU members.

Yet Switzerland also offers Brexiteers some comfort. Three decades of ill-tempered negotiations with Brussels have not persuaded Swiss voters to change their minds. Indeed support for joining the EU has fallen: no political party backs the idea. Remainers hoping to use the TCA as a base for a closer relationship or even to revive the idea of membership may well be disappointed.

Read more from the original source:

Counting the cost of Brexits impact on trade - The Economist

British prime Minister Boris Johnson hosts a virtual meeting of G7 leaders in the Cabinet Room at ... [+] Number Ten, Downing Street on February 19, 2021 in London, England. The 2021 G Summit will be held in Carbis Bay, Cornwall from 11-13th June.

This November, U.K. prime minister Boris Johnson will crow about the benefits of Brexit once again.

That is when the U.K.s Glasgow, in Scotland, will host this years UN climate conference, effectively handing a megaphone to Johnson to boast about his countrys climate ambitions. And thanks to Brexit, he will have something considerable to brag about: a formal pledge by the U.K., under UN guidelines, to cut greenhouse gas emissions 68% by 2030, well above the EUs pledged 55% cut.

The U.K.s role as host to this years COP conference, as the annual gatherings are known, is an example of how the U.K.s break from the EU affords it new opportunities to burnish its climate reputation on the world stage. While the true climate impact of Brexit may be somewhat negative what the U.K. gains in bragging rights, after all, the EU loses Brexit is at minimum a major public relations gift to Britains ambitions to sell itself as an environmental leader.

The COP26 is not the only international summit this year where the U.K. will have a chance to shine a spotlight on itself. In another stroke of luck, the U.K. is also set to host a meeting of seven of the worlds largest economies, the G7, this June in Cornwall. Climate is set to be one of the summit's main priorities.

The U.K. sees decarbonization as one of the global challenges where it can show potential leadership, said Alastair Hamilton, a partner at consulting firm McKinsey. The confluence of Brexit happening in the same year as the COP26 and when it is chair of the G7, the U.K. will be seeing that as...a big diplomatic opportunity.

Philippa Spence, an executive director at Denmark-based environmental engineering consultancy Ramboll, agreed: The Johnson government is seeing the green agenda as an opportunity to rebrand after a damaging year in 2020, with COP26 as a chance to present the U.K. as a global leader in this space.

The U.K.s biggest climate coup may have been in freeing itself of the nettlesome West-East tug-of-war that has plagued the EUs ability to set binding climate targets. Central and Eastern European countries, which still rely heavily on coal-fired power, have fought bitterly to keep the EU Commission from adopting tougher headline targets. Only in December did EU heads of state manage to persuade Poland and other holdouts, such as Hungary and the Czech Republic, to raise the blocs official target to a 55% cut of greenhouse gas emissions by 2030 against 1990 levels, up from the previous target of 40%. (The EU needs agreement from all 27 of its member nations to change targets.)

Flexing its newfound freedom from the EU, the U.K. pledged its own emissions reduction target, as required under the 2016 Paris Agreement, the very next day, December 12, as part of its submission to the COP26 conference in Glasgow: an attention-grabbing 68%.

The U.K.s exit from the bloc also renews attention to the fact that the U.K. is actually running ahead of the EU on some other big environmental goals. For example, it has pledged to ban sales of petrol and diesel cars and vans by 2030, whereas the EU has opted instead only to steadily increase its fuel economy standards.

Despite the leadership-enhancing effects of Brexit, the U.K.s exit from the bloc has already exacted real costs.

The EU has lost a valuable member nation committed to aggressive climate overhaul. And both the EU and the U.K. have squandered valuable political capital, time and focus on Brexit negotiations when they could have been working to decarbonize their economies. Brexit hijacked the EU agenda, as one December 2019 academic paper put it.

Even the Johnson governments expected eagerness to promote its new 68% cut in greenhouse gas emissions by 2030 leaves unacknowledged a key fact: the U.K. would probably have committed itself to a similar target even if it were still in the EU.

Even before it left the bloc, the U.K.s climate commitments were largely spelled out in national laws, not under any agreement with the EU, pointed out Shane Tomlinson, deputy CEO of E3G, a European climate think tank.

There are a lot of pro-Brexit people who want to sell a vision that somehow the U.K. is now unchained from the EU and free to innovate, said Tomlinson. However, in general these arguments dont pass any scrutiny.

For example, the U.K. still would have had the freedom to increase its 2030 greenhouse gas cut to 68% even if it had remained in the EU, Tomlinson said. (Even back when the EU was still targeting a cut of 40% by 2030, the U.K. was already committed to a 57% reduction, he said.) Additionally, by remaining inside the bloc the U.K. might have been able to use its negotiating power to leverage bigger commitments from member nations such as Germany or France, he said.

Of course, if the U.K. really is serious about striking new trade deals with other countries, it may be able to leverage its influence on climate around the world in ways that the EU, with its existing bevy of trade relationships, perhaps cannot. But this is far from certain.

Brexit also could make the U.K. less attractive as a haven for cutting-edge energy and climate firms looking for new homes in Europe. While it is still too early to tell, some anecdotal evidence suggests that at least a few cleantech firms are opting for the EU over the U.K., seeking the blocs greater bigger talent visa-free talent pool, the reduced dependence on customs checks at the border or its greater policy certainty.

This month the Intercontinental Exchange (ICE) said it would move its carbon emissions trading operations out of London to Amsterdam, as the U.K. now has its own, separate scheme.

And David Hunt, the CEO and founder of Hyperion Executive Search, which finds talent for cleantech firms, said that one of his clients, a listed U.S. company involved in electric vehicle charging, has switched its attention from the U.K. to Germany as it eyes locations to set up a European base of operations. Among the reasons, Hunt said, was concern about potential issues with imports of components from the EU into the U.K.

For electric vehicle producers, rules of origin requirements in the new trade deals mean U.K. firms will have to prove that at least 40% of the value of parts in a finished car originated in the U.K., commodities news specialist Argus Media reported this month. That may mean the U.K. would need to produce its own batteries, anodes and cathodes, a big change that could drive some manufacturers across the Channel.

Still, the number of departures of green tech firms so far has been minimal, and there have even been some surprises: Jaguar Land Rover unexpectedly decided this month that it would retool its U.K. carmaking site in the Midlands as a new electric vehicle hub.

It is one thing to declare more ambitious climate goals. Can the U.K. actually achieve them?

Experts say that much depends on whether the U.K. chooses to lower its environmental standards as it pursues trade deals with non-EU nations. The post-Brexit trade deal contains non-regression clauses and other mechanisms to limit the extent of possible backsliding on standards, but the energy section of the deal is temporary and will expire in June 2026 unless a more comprehensive agreement is reached or the deadline is extended.

While there is an obvious incentive to pursue such a strategy lucrative free trading relationships there are good reasons to think the U.K. wont bite. If the U.K. ever fell far behind the EU on products standards, for example, it would probably get smacked with a heavy carbon border tax which the EU Commission is even now working to erect along its borders. How would the U.K. then export to its nearest very large trading bloc? Now that becomes a massive challenge, said James MacGregor, an environmental economist with Ramboll, the engineering consultancy.

Nor have Brexiteers shown special eagerness to back out of EU environmental commitments. Notably, in January 2018 Cabinet Office minister and devout Brexiteer Michael Gove argued in an opinion piece for Politico that the U.K. called for the whole body of existing European environmental law to have effect in U.K. law.

While it is still too early to tell, the U.K., having staked its global image on an ambitious post-Brexit climate agenda, would likely be loath to fall short. Its reputation, if not the climate itself, depends on it.

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Brexit Burnishes U.K.s Climate Image, But Exacts Real Costs - Forbes