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Boris vs. Barnier. Both sides dig in as trade negotiations loom (Video)

The Duran Quick Take: Episode 459.

The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of this site. This site does not give financial, investment or medical advice.

The Duran’s Alex Christoforou and Editor-in-Chief Alexander Mercouris discuss the trade deal negotiations between the UK and the EU, with both sides already digging in and taking tough positions, as both sides set up new trading rules post Brexit.

The EU’s chief negotiator Michel Barnier has already warned that the European Union will only agree to a trade deal with the United Kingdom if Boris Johnson gives European fishing boats access to UK waters.

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Authored by Daniel Gros via Project Syndicate:

The European Union has lost one of its most important member states. The United Kingdom accounted for around one-sixth of the EU’s population and economy. Without it, the EU will still be one of the world’s premier economic powers, but it will suffer a loss of dynamism.

Still, there is hope for a fruitful, cooperative EU-UK relationship. The first step is to negotiate a trade agreement. But it would be a mistake to concentrate too much on the details of those talks. Trade is important to both sides, but the minutiae of the UK’s trading relationship with Europe will not determine its economic fate. The most likely outcome is a deal that eliminates tariffs for both sides, but even a return to standard World Trade Organization rules would not be the end of the world. While a better trade deal might prevent the loss of a few percentage points of GDP over the next decade, other variables, such as the quality of education, investment, and domestic regulation, are ultimately more important for growth.

In any case, the EU is much more than a market. It has its own currency and has abolished fiscal-policy frontiers across a massive geographic area. The UK did not participate in either of these key areas of integration and would not have done so anytime soon. As such, the EU has actually lost only a “one-third” member. The relationship with the UK needs to be managed properly. But the fact is that European leaders and policymakers have much more pressing issues to address. Brexit is now a sideshow.

Chief among the EU’s priorities is the European Green Deal, which is an area where the UK could continue to participate, given its shared concerns about climate change. In the long run, however, the EU’s efforts to complete the eurozone and the Schengen area of passport-free travel will put it and the UK on diverging paths.

Economists will continue to debate whether the euro was ever a good idea, with Anglo-Saxons sticking to the line that, “It can’t happen, it is a bad idea, it won’t last.” The euro crisis did seem to vindicate the UK’s skepticism. And yet opinion polls over the past few years show that the European population has moved beyond the academic debate. By the latest count, close to 80% of Eurobarometer respondents think the euro is “good for the EU.”

For younger generations that have never known any other currency, the very question of whether they would prefer some newly introduced national currency is nonsensical. There is a reason why Euroskeptic parties and candidates have consistently lost elections in which they have explicitly advocated an exit from the eurozone. Even an arch-populist like Matteo Salvini of the League party in Italy has abandoned the “No Euro” slogan on which he once ran.

Similar political dynamics apply to passport-free travel. The Schengen area is still a work in progress, but the direction of its evolution is clear: rather than retreating on the principle of freedom of movement, member states are gradually reinforcing the EU’s external border. Over time, that will give voters confidence that they do not need permanent controls or fences between member states. True, there are still some internal controls left over from the 2016 refugee crisis, but these are exceptions that prove the rule. In most cases, however, Europeans enjoy passport-free travel on the continent.

In the UK, these advances have been dismissed as part of the much-derided quest for “ever closer union,” which the British electorate never embraced. Nonetheless, EU integration will continue among the remaining 27 members, leading to further projects that the UK probably would not have supported anyway. The most conspicuous (and long-term) of these projects is European defense. Ironically, while the UK was in the EU, it always opposed proposals for a joint defense force. But now that it is on its own, it supports the idea, because it will facilitate EU-UK defense cooperation.

The UK has already become accustomed to playing second fiddle in its “special relationship” with the United States, so it is not unreasonable to think that it could accept a similar relationship with the EU. In most cases, the UK would inevitably follow Europe’s lead, while maintaining its sense of cultural superiority at home. British diplomats would be able to revive their pre-membership tradition of remaining aloof and mystified by European polyglots’ impractical schemes.

Of course, for such an arrangement to work, the EU will have to make a good-faith effort to consider the UK’s legitimate interests. That will require overcoming some bad habits. In its dealings with other neighbors, including the Balkan countries, Ukraine, and even Norway and Switzerland, the EU tends to behave like an acknowledged hegemon, often assuming a “take it or leave it” position.

To be sure, in economic terms, the EU’s relative size speaks for itself. But it is the UK that will be stronger in many other areas, not least security and intelligence, where the EU has limited capacity, while most individual member states have almost none at all.

Given these broader considerations, the EU would be mistaken to exploit its economic advantage when the trade talks start at the beginning of March. Brexit could ultimately lead to a productive special relationship in which the UK remains a close partner of the EU and makes a valuable contribution to Europe’s peace and prosperity.


The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of this site. This site does not give financial, investment or medical advice.

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Sally Snyder
Sally Snyder
February 7, 2020

Here is an article that looks at the economic impact of Brexit on the U.K. and on Europe as a whole:

While the economic impact on U.K. households will be substantial, in large part, the impact depends on what government policies are enacted after Brexit takes place.

February 7, 2020

“Why would the media and some business establishments want to undermine the UK’s position”?

Its very simple, and Alexander hints at it by mentioning DAVOS, the mainstream media is 100%, lock stock and barrel controlled by the Bilderberg/NWO/Supra-national corporatocracy, and the people that own media, are, without exception, Bilderberg members, want a post-Brexit UK to be a catastrophic failure, because if its not, others will follow, and the carefully laid plans for one world corporate controlled Government (which is already in deep trouble because of Trump/Brexit/Yellow vests/exposure of climate change as scam/Belt and Road/ascendant Russia) will finally disintegrate.

February 8, 2020

Bernier, isn’t he one of the MEPs funded by Soros?

The EU can demand all it wants, but, at the end of the day we are out. It will be their choice, if we end up with a Hard Brexit and using the WTO tariffs, when trading.

How many EU members are debtor nations and how few are creditor nations?

Jane Karlsson
Jane Karlsson
February 8, 2020

Here’s something I saw on the FT which tells you exactly why Barnier is taking the position he is.

“I work for a global manufacturer. The products we make in China have to meet EU standards, otherwise nobody buys them (not just ‘nobody in Europe’ – nobody globally). If China has to follow EU rules, how does Johnson think the UK can do without? It’s almost as if he is clueless.”

Jane Karlsson
Jane Karlsson
Reply to  Jane Karlsson
February 9, 2020

William Keegan, senior economics commentator at the Observer, appears to agree that Johnson is clueless.

“To put it bluntly: what government in its right mind would say goodbye to more than 70 advantageous trade agreements and start all over again? Answer, this government. Again: what government would wish to disrupt the smooth non-tariff barriers afforded by the single market, painstakingly negotiated by Margaret Thatcher, in order to risk queues at the ports and needless disruption to our way of life? Answer: the very same.”

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