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OUR ARMED FORCES AND DEFENCE: Forces for good and the first responsibility of any Government.

By Tim Scott

TimScottPhoto.jpg‘Strong National Defences’ is one of the founding principles of The Freedom Association. It serves to protect, and is the ultimate guarantor of, our other freedoms. Post-Brexit they fit in with a ‘global Britain’ that is present across the world and as a key driver not just of British security, but influence too. 

The Conservative manifesto of 2019 committed to the NATO minimum of 2% of GDP and a spending increase of 0.5% pa over inflation. A commitment to increase Defence spending by £16 billion over the next 4 years was very welcome. This will see Defence spending increase to about £54 billion by 2024. New agencies will be created for Cyber, Artificial Intelligence and Satellites.   

With already stretched public finances, this was a big win for Defence Secretary Ben Wallace. Service Chiefs had wanted a multi-year settlement to help plan for the future.

In truth, with the National Audit Office (for the 4th year in a row) criticising the Forces planned equipment budget as over-stretched and unrealistic, more money is needed to avoid more cuts in capability. Tough choices will continue to be made, the Army wants new armoured vehicles, the RAF those new F35 Lightnings, and the Navy would like more ships. 

The Treasury had wanted a smaller increase, but it is to Boris Johnson’s credit that he has recognised the need, plus the opportunity, to create more jobs and boost the UK’s influence. A good military will help you be taken seriously in Washington, whoever is in the White House. 

Former US President, Donald Trump, was right to publicly call out the NATO freeloaders, those not matching the agreed 2% of GDP minimum spending. Germany being the worst (relative to the size of its economy). 

If there’s one institution in Britain with a positive and can-do attitude, even (in fact, especially) under difficult conditions it’s our Armed Forces. They deliver. 

RAF_Chinook_helicopter_over_the_Sahara_Desert.jpgReaders will no doubt remember how successive Governments have called on our Forces in times of national emergency (and not just in times of war or conflict). Foot and mouth disease, not enough security guards for the 2012 Olympics, floods, a dam threatening to burst, and more recently Covid vaccinations of course. 

Tony Blair famously noted that when he asked the Forces to do something, the answer was always helpful and positive. When others were asked, he’d often get a list of excuses why not. 

Numbers have been considerably reduced over the last few decades, with many regiments merging. 

Let's consider the current strengths of our Armed Forces:

Army: 79,000 (official size 82,000) full-time and 30,000 reserves

RAF and Navy are at about 32,000 strong each. 

Our spending, as a percentage of GDP, has reduced from WW2 & post-WW2 heights of 5% in the 70s, about 4% by the end of the 80s to roughly 2.5% now. Whilst few (if any?) public services have had such a decline, to be fair we are in a different place strategically now. Northern Ireland is now (mostly) at peace; when I was there we had about 10,000 troops stationed. 

The UN peacekeeping commitment in Cyprus is now manned mostly by reserve troops (not a regular battalion, as was my first posting). Gibraltar and Belize now have a small presence only, not a 600-plus strong battalion group as was. Berlin and Hong Kong no longer have any British troops. What used to be West Germany now has a small presence only, and numbers in Iraq and Afghanistan are much reduced. 

Significant overseas bases retained by us are as follows:

Cyprus: The UK's biggest overseas base with 2 infantry battalions (about 600 strong each), 3000 personnel in total, much signals and intelligence gathering and an RAF base. The latter was used to launch cruise-missile raids against chemical weapons facilities in Syria. 

Gibraltar: Navy base and a small mostly locally-recruited garrison. The smaller RAF base has no planes permanently based there and doubles up as Gib airport- with an interesting approach and landing!

Brunei: a Gurkha Battalion plus jungle warfare school (I tried to get on that course, but with true Forces sense-of-humour was sent climbing in Norway instead). 

Falkland Islands: RAF base (takes flights from the UK via Ascension island), small Army presence, total about 1000 personnel strong. A Navy offshore patrol vessel is also permanently based there. 

Estonia: forward-deployed as a NATO commitment and based around an armoured infantry battalion. Troops are rotated through on a six-month posting, with vehicles there permanently. Total nearly 1000 personnel.  

HMS Jufair on Bahrain: our first base ‘east of Suez’ in years. It was reactivated in 2015. Guarded by a platoon detached from Cyprus, it hosts a Navy frigate (currently HMS Montrose), 4 minesweepers and a supply ship. Crews are rotated through every 4 months. 

We still have about 1000 troops in Afghanistan and Iraq, mostly training local forces. Camp Bastion - our largest base since WW2 - is now closed. 

In Mali (West Africa) there are 3 large RAF Chinook helicopters and 250 troops supporting the French on anti-Jihadi operations. 

There are also permanently manned training facilities in Oman, Belize, Canada and Kenya. In addition to the above, there are small Navy facilities in Singapore and at Diego Garcia in the Indian Ocean. 

As regards post-Brexit ‘Global Britain’ I feel that the Navy is the most relevant service (let's not forget the Royal Marines are part of the Navy). The 2 big new Carriers are good news, they will be able to project power, influence and deterrence globally. We will be able to rotate them, so can virtually guarantee to have one always available. Frigates and Destroyers are however a bit short at only 19 in total. 

HMS Argus has just returned from 8 months in the Caribbean (where we often have a ship), but is rumoured to be retired soon with no current announcement on a replacement.  

Our replacement nuclear deterrent is now confirmed, and will be based again on 4 dedicated submarines. They are expected to enter service during the 2030s.

The intended global deployment this year of a Carrier Battle Group to the Pacific and back (COVID allowing) is to be welcomed. The Queen Elizabeth, with 2 Type 23 Frigates, 2 Type 45 Destroyers, a tanker and a supply ship will go. I gather one of the new Astute-class submarines will accompany them (however, submarine deployments are never commented on by the MoD). 

The threats world-wide are certainly not getting any the less and remain unpredictable. China in particular is flexing her muscles and seeking global influence. We must continue to work with other friendly democracies. Claims of post-Brexit isolation are wide of the mark and we remain as committed to NATO as ever. Our armed forces are forces for good and long may that continue.

Tim Scott is Treasurer of The Freedom Association and a former Captain in The Queen’s Fusiliers

 

Photo Credits: RAF Chinnok Helicopter. © Crown Copyright 2014 Photographer: SAC Andy Masson. Image 45157162.jpg from www.defenceimages.mod.uk

HMS Queen Elizabeth: https://www.flickr.com/photos/infogibraltar/28386226189/ Creative Commons 2.0 Generic (CC BY 2.0) Licence


If the EU can’t be reasonable, the protocol must end

By David Campbell Bannerman, Chairman of The Freedom Association

The Northern Ireland Protocol (NIP) row that has gnawed around the edges of the G7 meeting of nations is essentially a clash of two very different approaches towards the same stated aim; but with one side having a deeper, hidden objective. 

The EU prides itself on being a rules-based organisation, and in my view is run by technocrats and lawyers - techno-legal I call it - at the expense of democratic politicians. As a result, it tends to be rigid about its rules, absurdly quick to court action, and holds to this approach rigidly and stubbornly to the extent of losing sight of the wider aim. So, it has almost immediately rushed to court action - in the court of European integration, the European Court of Justice, due to the UK unilaterally extending a grace period relevant to the Protocol, despite evidence of serious trouble in Northern Ireland.

The British are more pragmatic and democratic, law-abiding, but more willing to apply the law in more flexible ways consistent with that wider aim. Whilst the EU recites rules and terms, the British point out that the whole aim of this approach is now at risk due to the reaction to the way it is implemented.

So, on the Protocol, the EU claims it is to protect the Good Friday Agreement (GFA)/Belfast Agreement that underpins the Northern Ireland Peace Process - which I worked on some years ago when it started, as a Government Special Adviser. We British clearly want to respect the GFA and to retain the peace in Northern Ireland. So important is this aim that it forms Article 1 of the Protocol. 

The EU claims that any failure to implement the Protocol is a threat to the Good Friday Agreement, except they just mean one side and one community in Northern Ireland. Unfortunately, it seems that the instinctive Irish Catholic American stance, embodied by the Kennedy Clan and Ted Kennedy’s closeness to Sinn Fein, is now being reflected in President Biden’s one-sided take on the problem. If The Times report is correct that the most senior current diplomat in London, Ms Yael Lempert, read out a ‘reprimand’ – a ‘demarche’ – about ‘inflaming’ the process to Lord Frost and our Government, then the sooner a more informed and balanced Ambassador is appointed, the better for all. President Clinton gave four speeches in Northern Ireland in my time, all to different communities and brilliantly reflecting their concerns and wishes. Biden has in contrast blundered into this row ill-informed and lacking key understanding, as has the Speaker Nancy Pelosi, whom I met in London. They see the Protocol as protecting the GFA, but this just isn’t the case. 

OK, so clearly they don’t want a return to IRA/nationalist violence and maintain this would happen with an enforced North/South Border. But they say next to nothing about the other key community in Northern Ireland - the Unionist/Loyalist community, loyal to Britain. It is this community who are now increasingly resentful, distrustful and isolated by the implementation of the NIP. The traditional ‘Marching Season’ due to start shortly, commemorating William of Orange’s (hence the colour) win at the Battle of the Boyne on 12th July 1690 over forces of King James II, deposed by the Glorious Revolution in 1688, and with the vital Bill of Rights following in 1689 that confirmed Parliamentary sovereignty as we know it. There have already been riots and disorder, but any further EU intransigence will literally pile more fuel on the commemorative bonfire. Time is short. 

This is not some academic debate, it is very real and very dangerous. In the Peace Talks I met ex-Loyalist terrorists who had engaged in violence - one had machine-gunned a bus queue; another stabbed a Sein Fein councillor and his girlfriend to death. If the EU crosses its modern representatives, there is a real danger of a return to violence. They won’t be putting a counter case in the ECJ, but they may take action against the EU directly - its customs officials in Northern Ireland have already been disgracefully threatened. But attacks in Dublin or Brussels are not beyond the bounds of possibility, and no one wants to go back there. 

Essentially, we are at a crossroads on the Protocol now. The decision is either:

1.) To make do with the NIP; but the EU agrees to act reasonably and not treat goods arriving from GB as if arriving from dodgy East European gang sources or in Rotterdam from unethical Asian manufacturers. Maybe an agreed limit on the number of checks – 2% is the normal rate not 20% - might ease the situation. As Raab has said: the “EU must be less purist, more pragmatic and more flexible in the implementation of it.” The nub of the problem is less the actual agreement – though that is very challengeable – but the unreasonable implementation of it by the EU. 

The World Customs Organisation, which the EU and UK are part of, has long pushed for ‘intelligence led’ customs, as does the EU’s Union Customs Code 2016, meaning checks are only done if there is some information that the goods are faulty or the company trading them suspicious. 

The excessive and provocative degree of checks suggests a deeper and more sinister EU agenda: that the EU wants to use Northern Ireland as a lever to force Britain to accept its rules. It keeps pushing this as a simple solution - accept EU agricultural standards – food and veterinary - now and automatically in future and 80% checks will miraculously disappear. But the practical effect of this is that the UK has its hands tied when it comes to doing trade deals as it is no longer in control of some of the core parts of free trade deals - agricultural goods. 

Now the EU has good reason to fear competition from cheaper non-EU agricultural goods coming to Britain, because its Customs Union is protectionist and keeps EU food prices at least 20% higher than world food prices. There is also what Dominic Raab alleged as Brexit Secretary three years ago: that senior EU figures implied losing Northern Ireland was “the price the UK would pay for Brexit” – that the EU had a wish to “carve up” the UK. So, there are deeper political and economic reasons for this unreasonable stance.

Northern_Ireland_Map.png2.) The second option is more fundamental and profound, but is cleaner and neater. That is for the UK to declare that the Protocol is not working, that it is leading - in the legal language of Article 16 - to “serious economic, societal or environmental difficulties, that are liable to persist, or to diversion of trade.”  There are plenty of grounds for this – the First Minister of the Northern Ireland Assembly, Arlene Foster, was dramatically toppled by the backlash from the Protocol, whilst serious riots and disorder have been on the streets on a scale not seen since before the Peace Process, and a return to staking out targets. Trade has been hit hard by checks on certain products – with chilled food and the iconic sausage now at urgent risk. 

So, if the UK invokes Article 16 of this Protocol – and Boris Johnson has rightly and firmly mentioned Article 16 a number of times, including in Parliament - and so suspends this ‘safeguard’ (emergency) clause. The EU actually did this for a few hours over vaccines, before withdrawing it. So what happens next?

Either the Protocol is renegotiated to make it more flexible – perhaps we could agree to an upper limit on the checks made? 2% are the normal checks - not 20%, more than for Rotterdam or Eastern European goods - or for independent experts to rule on what is actually reasonable. Or go further and remove Article 5, referring to Northern Ireland being in the EU’s Customs Union for agricultural goods. 

But President Macron has made it clear “Nothing is negotiable. Everything is applicable.” So, if the Protocol cannot be renegotiated, nor the bigger Withdrawal Agreement which contains it, and remains suspended permanently or annulled, what then? 

Technically, as Northern Ireland will then be out of the EU’s Customs Union for agricultural and industrial goods, there will have to be – shock, horror! - a border on the island of Ireland. But that doesn’t mean a ‘hard’ border. 

Firstly, technically, there are plenty of invisible, soft borders now – a currency border (Euro/£) without exchange controls or checks; tax rates – different VAT and corporation tax rates, miles go to kilometres to the South. But there is a Common Travel Area. 

Second, there have been practical fixes before. The UK earlier signed up to EU Sanitary and Phytosanitary (SPS) measures – as Ian Paisley memorably quipped: “Our people maybe British; but our cows are Irish!”, so their standards have been the same both sides of the border, suggesting pragmatism – this avoided an EU ban due to Foot and Mouth.

Third, there is no need. In giving evidence to Parliamentary committees, both British and Irish senior customs officials have made it clear there is no need for a ‘hard border’ – meaning physical checks on the border line, with barriers and peaked hats. This all went with the Single Market in 1992. 

There is no rationale for a hard border: borders are in computers these days, with checks only done on the basis of perceived risk or intelligence information. Britain has the CHIEF system (Customs Handling Imports and Export Freight), and is upgrading to the massive Customs Declaration System. 2017 evidence by Chairman of the Board of the Irish Revenue Commissioners, customs expert Niall Cody, confirmed to the Irish Dail very low checks would result: “the EU policy is to go to an IT-based customs process that is totally paperless.”

Also, most exports and imports are done under a ‘Trusted Trader’ scheme where basically traders are checked up on as an organisation in advance and if satisfactory, and regular - such as regular movement of ingredients and semi-processed product for Guinness or Kerrygold back and forth – then very few actual checks are made. 

When I visited Britain’s biggest container port, Felixstowe, they informed me only 4% of incoming containers are checked on such grounds. Niall Cody explained: “In 2016, 6% of [Irish] import declarations were checked and less than 2% were physically checked… The low level of import checks is the result of pre-authorisation of traders, advance lodgement of declarations and an extensive system of post-clearance checks, including customs audit, which are carried out at a trader’s premises… There are currently 133 AEOs (Authorised Economic Operators) which account for 82% of all imports and 89% of exports.” 

So, between 8 to 9/10 movements are covered by Trusted Trader like schemes, used a lot at the US/Canadian border. Only 20% of Northern Ireland’s exports go South to the Republic anyway and we are talking about 0.02% of the EU’s GDP. 

There is an international scheme too – the common transport convention – that allows flow of trucks containers without checks, such as from Dublin to Paris via Belfast.

The problem with a border in the island of Ireland has already been mostly sorted by the Protocol – checks are done for goods (‘at risk of’) heading South are already checked well away from the actual border such as Larne, near Belfast. That bit is working – it is the GB/NI checks that are not. This arrangement could now be adapted to handle cross border UK/EU traffic. Maybe extra facilities could be added elsewhere, but the principle is established. 

I have written or helped to write three papers on a way of solving the border issue, and sat in Number 10 discussing them. May was reportedly terrified into believing a border issue would lead back to war. I never understood why the issue had become so totemic when practical solutions were always at hand and customs experts all agreed a hard border wouldn’t happen. I concluded that a solution was not wanted because a free trade agreement wasn’t wanted, because of this wider, deeper game by the EU and Remainer allies in Britain to keep the UK as enmeshed as possible in EU rules, making rejoining the EU much easier. 

So, if practical to do, what about the consequences of doing it? 

It is worth mentioning a court case challenging the Protocol for the lack of consent inherent in the Good Friday Agreement. I witnessed first-hand how it was built on consent. If proven that the NIP was incompatible, this would be helpful for the UK case. 

But whatever happens, it is likely that the EU will seek to ‘punish’ Britain in a highly legalistic way and suspend parts of the related trade deal, The Trade & Cooperation Agreement (TCA). President Macron in particular has been threatening tariffs and a mini trade war has been explicitly [threatened] as a sanction.

But how sensible and realistic is this really? Sure, the EU could impose some pain, as it did against US goods over their recent trade war. But with Britain we are the main customer with a normal £95 billion goods deficit with the EU - in short, we import far more than we export to the EU and have therefore a rich picking of our retaliatory tariffs. Should we slap tariffs on German cars, French wine, Belgian chocolates perhaps? 

That won’t help Macron when facing an already difficult re-election campaign as President. There is already hardening evidence that whilst UK exports to the EU have held up now as normal, imports from the EU into the UK have fallen significantly. The British customer does seem to be reacting to such threats already by avoiding EU goods. This would only increase.

The form on bullying – it punished Switzerland for seeking to limit free movement by blocking Switzerland from the Horizon research programme, and trade talks failed after 7 years. No doubt a package of irritants would be formulated as the EU did in its recent US trade war over Airbus/Boeing subsidies. But under the wider Withdrawal Agreement the EU benefits greatly from settlement rights for 5 million EU citizens – 1 million more than estimated – and from continued cash payments for various agreed schemes and liabilities. The EU is not in the greatest financial position just now, so suspending any payments could bring pressure. 

In conclusion, none of these options is too difficult to contemplate. They are doable and survivable. If being prepared for stronger solutions makes the EU see sense and adopt a more workable implementation of the Protocol that might solve the main issues, at least until the Assembly can revisit the Protocol after four years. But I don’t see any such contrition – the EU regards this as an opportunity to flex its muscles, to do down an over-successful independent upstart Britain.  

So, I think there is growing inevitability that the Protocol is suspended under Article 16, and soon, before tensions arise around the Marching Season. I think we can take any punishment meted out in our stride and reciprocate with surprising power and effect. 

The EU does need to be shown its increasingly bellicose and self-important approach, and dangerous games with a vital part of UK territory, are totally unacceptable. In the end, this is again about sovereignty. The Protocol was better than the original disastrous Chequers mess May and her advisers managed to concoct. If it has been a useful stepping stone towards a more acceptable and long-lasting arrangement, that sees Northern Ireland properly free of the EU - as Great Britain already is - then it will have fulfilled its purpose. In my view, we needed to get out of the EU first in order to be sure we were free and able to come back and negotiate a better long term deal.  

But now it is time to be bold, for the sake of the British Union. We have heard nothing but bluster, arrogance, unreasonable behaviour and threats from the EU. It is time to call the EU’s bluff. Let them do their worst. It’s time to end the Protocol. 

David Campbell Bannerman is a former MEP of 10 years (2009-19) for the East of England. He is a leading Brexiteer and strategist, with an expertise in international trade.

 

Photo Credit: President Macron - EU2017EE Estonian PresidencyCC BY 2.0, via Wikimedia Commons


The Freedom Association welcomes the new UK/Australian trade deal

The Freedom Association welcomes the new UK/Australian trade deal announced yesterday. David Campbell Bannerman, Chairman of The Freedom Association, a former MEP and international trade expert, said:

"The Australian deal cements our strong natural bonds with our great Aussie friends. It is good news for UK car, whisky and ceramics producers, for our vital services industry, for UK professions whose qualifications will be recognised there, for UK consumers, and our young people - they get new opportunities to travel to Australia for longer."

ENDS

Media Contact

Andrew Allison, Head of Campaigns

Email: [email protected]

Tel: 07803 741104

 

Notes for Editors

1. The Freedom Association is a non-partisan, centre-right, classically liberal campaign group. We believe in the freedom of the individual in all aspects of life to as great an extent as possible. As such, we seek to challenge all erosion of civil liberties and campaign in support of individual liberty and freedom of expression. Visit our website: www.tfa.net

2. The Freedom Association launched its Better Off Out campaign in 2006. More information here: www.tfa.net/better_off_out


The pandemic is over and the virus is now categorised as endemic. It is amongst us and we have to manage risk

By Andrew Allison, Head of Campaigns

The vaccination programme has been a huge success. A total of 33,666,638 people have received the first dose, and a total of 12,587,116 people have received the second dose. Because of the vaccination programme, Covid cases have fallen by up to 90 per cent. 

New research (based on throat swabbing over 370,000 UK citizens between December and April) has found that one dose of either the Oxford/AstraZeneca or Pfizer vaccine sees a fall of 74 per cent in symptomatic infections, and a fall of 57 per cent in asymptomatic infections. After two doses of the vaccine, those figures rise to 90 per cent and 70 per cent respectively. Wonderful news! 

Results announced last month from the U.S. and South American study of the Oxford/AstraZeneca vaccine have found that it was 79% efficacious in protecting against symptoms of Covid-19. In the trial, the two-dose shot was also 100% efficacious in protecting people from severe symptoms and hospitalisation from the disease. We should all be rejoicing at this news.

With all of this great news and with deaths with or of Covid at very low levels, why are we not opening the rest of the economy sooner? I appreciate that the Government doesn't want to take unnecessary risks, but the Prime Minister has said that he will be guided by data, not dates. The data could hardly be better. We should be getting on with it now.

What we also need to decide as a country are what levels of restrictions are acceptable in the future. It appears that the Government is receiving advice that when Covid infections rise again from the autumn, social distancing and mask wearing will once again be necessary. Most of the restrictions, we are told, will not be necessary through the summer, but not beyond it. Is it acceptable for mask wearing to become the norm? Are we prepared to tell children that they should wear face masks for over six hours a day whilst they are at school? Will social distancing in pubs and restaurants be with us for years to come? Some businesses may not be viable if that is so. Are we as a country prepared to allow some businesses to go to the wall in order to limit the transmission of Covid, even though because of vaccines the most vulnerable will be protected? 

The pandemic is over and the virus is now categorised as endemic. It is amongst us and we have to manage risk. Over recent decades we have become more risk averse. Is the reaction to Covid a symptom of how just risk averse we have become? How frightened as a country are we that we feel we need to lock ourselves away? I appreciate that the law of the land has been changed to make sure we comply with many rules and regulations, but the vast majority of citizens have been happy to give up many freedoms. How long are they going to be prepared to continue to do that? 

I know where I stand and will do everything that I can to present alternatives to the status quo; alternatives which manage risk and protect basic freedoms. For those who say that life is going to go back to normal from 21st June; to stop bleating on about restrictions because we are nearly there, I have this message: you are wrong. If the Government wants, it can continue to restrict freedom until September. It has those powers thanks to the extension of the Coronavirus Act. And I wager that those powers will be extended for another six months in September. 

Wake up, wake up, it's later than you think. 


No deal just became the most attractive way forward

By David Campbell Bannerman, Chairman of The Freedom Association

Very soon a choice will have to be made: whether to continue negotiating a trade deal with the EU or to end negotiations and to prepare for ‘no deal’/Australia deal/WTO rules.

The way the EU has behaved has made no deal much more attractive. What they have done is to narrow the gap between the advantages of a free trade deal, with zero tariffs and quotas, and that of working under WTO Rules, to such an extent that having such a thin deal laden with all sorts of restrictions and continued ties is the greater risk. This is encapsulated in what they call cheekily ‘Level Playing Field’ rules, but what are in effect the EU forcing us as an independent sovereign nation to follow the rules they set, including new ones we have no say or voice on. 

Now, if we had opted for an ‘EEA’ type solution such as Norway’s then we would be signing up to such an arrangement. Norway has to follow all EU Single Market legislation with no voice and little influence. It kicked up a fuss on one Directive – on Postal Services, but even that rare challenge was overturned. EEA also means no control of immigration, which is a no-no post our Referendum. 

This is why we went, after much debate, for a free trade agreement relationship with the EU because it is looser, more arm’s length, less prescriptive, and means we are out of the Single Market and Customs Union, with its rules.

I say this as someone who has pushed for an excellent free trade agreement – what I have called ‘SuperCanada’, that is bigger, better and wider than the EU-Canada deal CETA – for years now. It is what Boris Johnson has called for – he used my term ‘SuperCanada’, as did Jacob Rees Mogg, after I presented to the ERG on the proposals in September 2018. I wanted a SuperCanada deal not just for our benefit, but for that of our EU colleagues and friendly nations. 

This is basically what the EU concluded was the only deal possible right from the start post-Brexit, and has been offered three times – by the previous President of the EU Council Donald Tusk and by Mr Barnier himself.

On 7th March 2018, after coming to Number 10, Tusk said: “I propose that we aim for a trade agreement covering all sectors and with zero tariffs on goods. Like other free trade agreements, it should address services. I hope that it will be ambitious and advanced.” Ambitious means wide and with as few tariffs or barriers as possible.

And Barnier himself said, “It is possible to respect EU principles and create a new and ambitious partnership. That is what the European Council has already proposed in March [as above, 2018]. The EU has offered a Free Trade Agreement with zero tariffs and no quantitative restrictions for goods. It proposed close customs and regulatory cooperation and access to public procurement markets, to name but a few examples.

"On security, the EU wants very close cooperation to protect our citizens and democratic societies. We should organise effective exchanges of intelligence and information and make sure our law enforcement bodies work together. We should cooperate to fight crime, money laundering and terrorist financing. We can cooperate on the exchange of DNA, fingerprints, or Passenger Name Records in aviation to better track and identify terrorists and criminals. We are also ready to discuss mechanisms for swift and effective extradition, guaranteeing procedural rights for suspects.

"If the UK understands this, and if we quickly find solutions to the outstanding withdrawal issues, including the backstop for Ireland and Northern Ireland, I am sure we can build a future partnership between the EU and the United Kingdom that is unprecedented in scope and depth.”

Yet on 18th February 2020, the same Mr Barnier suddenly declared “we remain ready to offer the UK an ambitious partnership” (partnership in EU terms normally means embracing non-trade affairs such as defence, security, judicial cooperation or foreign policy). The EU has suddenly noticed the UK is geographically close to the EU after 47 years and has reduced the partnership “unprecedented in scope and depth” to “a trade agreement that includes in particular fishing and includes a level playing field, with a country that has a very particular proximity – a unique territorial and economic closeness – which is why it can’t be compared to Canada or South Korea or Japan.

So just after we had left the EU on 31st January 2020, the EU moved the goalposts and took away a comprehensive free trade agreement, instead offering a partnership agreement which was not comparable to the kind of FTAs the EU had concluded, and which Lord (David) Frost has cleverly kept the UK’s requests very closely aligned to. The EU weren’t willing to offer the FTA they offered 3 times before because we were now considered geographically close! No wonder several of our top Brexiteer lawyers, including Bill Cash in the Commons recently, regard this as ‘bad faith’ in legal terms, which could in theory invalidate the Withdrawal Agreement itself, as our payments and approach were grounded on receiving an FTA. 

So, it is bad faith and a huge misunderstanding by the EU of the realities of the balance of power in trading terms that has brought us to this impasse. As in the Referendum, the EU makes the cardinal mistake of believing its own propaganda: they think that because the EU nation economies put together are bigger than the UK’s, that they hold all the cards. This is supported by our mainstream media, such as the BBC.

But the reality is that the UK is just about to become the EU’s second largest trading partner after the USA. We are the world’s fifth largest economy, the same size currently as India; 20% larger than Russia. If tariffs are imposed in no deal, the EU will be paying £12-13bn a year and the UK only £5bn. Actually, although 43% of our exports go to the EU (57% to the Rest of the World notably), only 7.5% of GDP – of our economy – is exports of goods and vulnerable to EU tariffs.

The EU has a £95 billion goods surplus with the UK, mostly on tariff heavy agricultural and manufactured goods, and though the UK has a £13bn surplus in services, these don’t have tariffs on them, though are subject to licensing such as EU financial passporting, which UK institutions have already worked around. 

So, the reality is that the EU needs a trade deal with us more than we do with them. Not something you hear very often.

If we go to no deal/Australia/WTO Rules, then it is worth remembering that two-thirds of the world trades under WTO Rules, and that the USA and China export more to the EU than we do. So much for geography! Also, most countries do Free Trade Agreements from a WTO Rules position – the recent EU-Japan FTA took Japan and the EU out of a WTO rules position. 

If we are trading under WTO Rules, and the EU is hurting from £13bn a year tariffs, with job losses from these – remember the UK Market employs over a million Germans, half a million Dutch, 400,000 French people – then far from the UK rushing to do a deal, as the French arrogantly claimed, the EU would be under the cosh most. 

By the time a UK-EU FTA is signed – perhaps even finally that SuperCanada style of deal – the EU could have lost a huge chunk of that £95 billion goods surplus from ‘reshoring’ within the UK, from returning manufacturing jobs in food, drink, car parts, steel, trains and from ‘import substitution’ to UK producers or non-EU suppliers from all round the world, such as our Commonwealth, driven by less red tape and the massive surge in UK Free Trade deals Liz Truss has rolled out.  

Whilst we are not protectionist as an organisation, a resetting of the UK’s trading position with the EU, as President Trump reset relations with Mexico and Canada (replacing NAFTA with the USMCA FTA) might be in order, and allow us to redirect our trading markets and suppliers away from an EU focus. 

In short, we shouldn’t be worried if no deal occurs at the end of the year. It will affect only 7.5% of our economy directly by tariffs, and where those are high (many are low or zero rated anyway), those sectors can obtain legal support under WTO rules: farming directly and manufacturing indirectly, such as through aid for Research & Development. The EU Single Market has not suited us at all well since 1992, and a short sharp shock of rebalancing the trading figures would be no bad thing. 

So, let’s not allow the latest Project Fear hysteria to detract us. We should not be signing a deal that ties our hands on EU laws, keeps us in a regulatory straightjacket and seeks to seize our sovereign fishing waters under UN, not EU laws. Boris Johnson is holding firm on our sovereignty and we should stand right beside him and with those principles if we have to go to no deal.


WATCH a webinar we hosted in October: What‘s stopping a trade deal with the EU and is no deal better anyway?

Answering the questions were: David Campbell Bannerman, Chairman of The Freedom Association, a former MEP and international trade expert; Martin Howe QC, a leading barrister in the fields of intellectual property and EU law; Rt. Hon David Jones MP, Conservative MP for Clwyd West, and a former Minister of State at the now defunct Department for Exiting the European Union; Lee Rotherham, Director of think tank The Red Cell and a Common Fisheries Policy expert; and Barney Reynolds, a partner at Shearman & Sterling and the author of 'A Blueprint for Brexit: The Future of Global Financial Services and Markets in the UK' and many other publications.

The webinar was chaired by Alex Deane, a public affairs consultant and political commentator

 


Protectionism never works. It's time for the USA to realise this

The main news story this morning is the decision of the US authorities to impose a 220 per cent tariff on the imports of C-Series jets made by Bombardier in Northern Ireland. Bombardier is a major employer in Northern Ireland and 1,000 jobs are linked to the C-Series jet. This tariff has been imposed because Boeing complained that Bombardier gets unfair state subsidies from the UK and Canada. This tariff could triple the cost of the C-Series jet in the US, and you don't need a Ph.D to work out what that means: Bombardier will no longer be able to complete in the US market. This is protectionism, and protectionism always comes back to bite you when you least expect it.  

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