09-17-2016, 05:02 PM
Almost 3 months after the conclusion of the EU referendum, the UK still appears to be in a honeymoon period.
The dire predictions of economic contraction and recession have been avoided for now, if only because of prompt action by the Bank of England and a wait and see attitude by businesses.
The issues are now how and when to start negotiating our exit from the EU, and the sort of trade agreement we wish to entertain.
The Conservative administration does not appear to be in any hurry to start the process, not least as the establishment never imagined the electorate would vote Leave, and have been caught off-guard.
The general consensus is that the process will start in 2017, with a conclusion by 2019.
There is a considerable weight of opinion that the government will have to repeal the European Communities Act first, if only to be seen to be following procures and to allow MP’s a protracted debate, and their 5 minutes on TV.
This could be in lieu of a dedicated parliamentary debate and vote on BREXIT, since a majority of MP’s actually voted Remain.
The government would then presumable invoke Article 50, triggering a 2 year period of negotiations to dis-engage from Europe.
The first action that needs to be done at this time is the formulation of a negotiation position and the recruitment of trade delegations to facilitate negotiations
There are five recognised forms of trade agreement this country could ascent to, and the details below are taken directly from the following BBC article:
http://www.bbc.co.uk/news/uk-politics-eu-referendum-36639261
The Norway Model - Member of European Economic Area, full access to single market, obliged to make a financial contribution and accept majority of EU laws, free movement applies as it does in the EU.
It could be argued that the UK electorate have already rejected this trading model and it would be unacceptable to a sizeable minority of the general public if only because free movement was one of the most contentious issues.
The Swiss Model - Member of the European Free Trade Association but not the EEA, access to EU market governed by series of bilateral agreements, covers some but not all areas of trade, also makes a financial contribution but smaller than Norway's, doesn't have a general duty to apply EU laws but does have to implement some EU regulations to enable trade, free movement applies though.
The Turkey model - Customs union with the EU, meaning no tariffs or quotas on industrial goods exported to EU countries, has to apply EU's external tariff on goods imported from outside the EU.
The major drawback is that it does not cover agricultural produce, or services.
The Canada option - Ceta free trade deal with the EU has yet to come into force, gets rid of most tariffs on goods, but excludes some food items and services, and stipulates need to prove where goods are made.
The Singapore and Hong Kong approach - City states do not impose import or export tariffs at all - a unilateral free trade approach. This is closest to a WTO framework, although there are issue with such a solution, since it reputedly contains many default tariffs.
The dire predictions of economic contraction and recession have been avoided for now, if only because of prompt action by the Bank of England and a wait and see attitude by businesses.
The issues are now how and when to start negotiating our exit from the EU, and the sort of trade agreement we wish to entertain.
The Conservative administration does not appear to be in any hurry to start the process, not least as the establishment never imagined the electorate would vote Leave, and have been caught off-guard.
The general consensus is that the process will start in 2017, with a conclusion by 2019.
There is a considerable weight of opinion that the government will have to repeal the European Communities Act first, if only to be seen to be following procures and to allow MP’s a protracted debate, and their 5 minutes on TV.
This could be in lieu of a dedicated parliamentary debate and vote on BREXIT, since a majority of MP’s actually voted Remain.
The government would then presumable invoke Article 50, triggering a 2 year period of negotiations to dis-engage from Europe.
The first action that needs to be done at this time is the formulation of a negotiation position and the recruitment of trade delegations to facilitate negotiations
There are five recognised forms of trade agreement this country could ascent to, and the details below are taken directly from the following BBC article:
http://www.bbc.co.uk/news/uk-politics-eu-referendum-36639261
The Norway Model - Member of European Economic Area, full access to single market, obliged to make a financial contribution and accept majority of EU laws, free movement applies as it does in the EU.
It could be argued that the UK electorate have already rejected this trading model and it would be unacceptable to a sizeable minority of the general public if only because free movement was one of the most contentious issues.
The Swiss Model - Member of the European Free Trade Association but not the EEA, access to EU market governed by series of bilateral agreements, covers some but not all areas of trade, also makes a financial contribution but smaller than Norway's, doesn't have a general duty to apply EU laws but does have to implement some EU regulations to enable trade, free movement applies though.
The Turkey model - Customs union with the EU, meaning no tariffs or quotas on industrial goods exported to EU countries, has to apply EU's external tariff on goods imported from outside the EU.
The major drawback is that it does not cover agricultural produce, or services.
The Canada option - Ceta free trade deal with the EU has yet to come into force, gets rid of most tariffs on goods, but excludes some food items and services, and stipulates need to prove where goods are made.
The Singapore and Hong Kong approach - City states do not impose import or export tariffs at all - a unilateral free trade approach. This is closest to a WTO framework, although there are issue with such a solution, since it reputedly contains many default tariffs.