All those negotiators

[Suff]

All those millions of hours of hot air and talking to get a free trade deal with Canada.

And it's all up in the air because half of Belgium wants "assurances" that "free trade" doesn't really mean "free trade".

If this fails where does Canada look next? The UK?

The US TTIP is in tatters and unlikely to be recovered in the next presidency because of leaks in the EU (they had to keep it secret because of how much the US insisted on being changed), so where does the US look next? The UK?

Interesting times. Well for someone anyway.

[Suff]

And there I was thinking that we could "flag" our ferries in Canada when we left and ship all our goods "through" canada on the way to Calais....

It's interesting reading the comments from the senior EU officials. "If we can't negotiate a free trade deal with Canad what chance do we have with the rest of the world?"

And there I was, just a few weeks ago, saying that the EU needed hundreds of negotiators because the EU is ALL about restricted trade so trade deals are so hard.

The UK is ALL about free trade so deals with us should be quite easy.

Time will tell. But, I must admit, I'm highly amused.

[Suff]

And Finally, in a footnote which rolls back just about everything the BBC has said about Brexit, it talks about the UK's ability to negotiate trade deals.

For the UK post-Brexit, it suggests two contrasting implications:
◾Negotiating a trade agreement that gives British exporters barrier free access to the EU's single market could be a huge challenge. For sure, there will be some important differences. For the EU, Britain is a more important export market than Canada, so some EU states will have a good deal to lose from failing to agree. But securing the agreement of all of them is unlikely to be straightforward
◾On the other hand, negotiating an agreement with other countries outside the EU should become easier. To put it bluntly, the British government will not need to care what the Walloon parliament, for example, thinks

[Workingman]

It is not only the BBC, other news outlets are also carrying stories of the possible pitfalls to an EU/UK trade deal, and they are right to do so.

Thankfully PM May also recognises the potential for tough times ahead, as she has been hinting at over the past few days in Brussels. To paraphrase: Negotiations need to be firm but fair; They have to be conducted in a calm manner; The deal must be good for the UK, as well as the EU.

She has not mentioned names, but she knows that Spain could cause trouble over Gibraltar. Romania and Bulgaria, who do not want their citizens back but who quite like the money they send over, could scupper any deals. And what about the EEA? It pays in and gets free trade along with free movement but has no say in EU rules. Its members are unlikely to want a bespoke deal for the UK, so she can expect pressure from them, behind closed doors of course.

The absolute bottom line of A50 is that negotiations only need to be about how a country extracts itself from the treaties it has signed as an EU member - the EU is clear on that. Any other negotiations are secondary and lopsided in the EU's favour as it only takes one of 27 to veto anything it does not like.

[Suff]

It's not so much that it's going to be difficult. I've always thought it would be near impossible in the short term, with the only chance being the way EU business with the UK would be hurt. Until such time as EU, especially German, businesses feel the pain of 25% and 30% tariffs on their goods in the UK and the corresponding loss in sales. Let's face it most luxury cars in France are French, In Italy they are Italian and in the UK they are German.

People are not going to start paying £12-15k more, mid range, for their BMW's. They're going to start looking for options. For the Mercedes it's even worse.

My contention is that it's probably going to be best to get out with no deal and then let the 100bn, inward, trade clamour for a deal from their trade negotiators. Then we're in the driving seat. Something the BBC and all the other media, who have been trying to whore the country out for an easy life, are starting to get a clue about.

Let's face it if this deal with Canada fails, after 7 years of negotiations, then the next deal on the table is the UK as TTIP is not going anywhere, any time, soon. Here's the fun bit. The UK already meets every single requirement in the Canadian deal and many, many, more over the top. We are an almost exact match for the EU with one single condition. We won't allow free movement of people.

Given that none of the other trade deals the EU is trying to do include full and free movement of people, as well as goods; if the EU fails to negotiate a trade deal with the UK, then the rest of the world will walk away as they recognise that a failure to do a trade deal with both Canada AND the UK means they EU will be unable to do a trade deal with anyone else in the world. Or maybe that's a bit strong, I'm sure they could manage Tongo.....

This, then, becomes an extremely interesting situation. Wallonia is not going to stand down unless it gets ten times what it is worth in return. The EU simply cannot allow Wallonia to hold up the trade deal otherwise it will give every other small State/Region the green light to blackmail every trade deal.

Wallonia, on the other hand, has absolutely nothing to lose from scuppering this deal. Only France and Germany will make really good use of the deal, all Wallonia will see is the bread crusts and take the burden of the bad parts.

I sit here looking at possibilities. Because the EU simply can't allow the UK to walk away and then be re-integrated with a different, but preferential, trade deal. But if Wallonia scupper the Canadian deal, then the UK is their only salvation. Not to the few hundred billion of the Canadian deal, but to the trillions that deals with the US and China will bring.

The EU states are so inward looking and so insular that I don't believe that the PM of Wallonia has the slightest clue about what holy wrath of God is about to descend on their heads. Strangely enough, in the convoluted political landscape of Belgium, this may strengthen their resolve. Not weaken it.

Meanwhile the markets get a clue and the £ is rising and rising and rising. The ECB has had to switch on the money machine again and rates are staying negative "forever" until they see growth in the entire EU. Growth in the entire EU is, to be very charitable, ephemeral and is likely to remain there for quite some time. The BOE, on the other hand, is doing the backtrack dance, one slow step at a time. Leading, eventually, to a cancelling of the money printing and raising of interest rates.

The message is already changing. Expect it to change more.

[Workingman]

Suff, where do the 25% to 30% tariffs come from?

If we get 'Hard Brexit', which is likely, we go to WTO rules, and its tariffs on cars are 10%. We cannot impose any restrictive tarifis and in return the EU cannot impose tariffs on us over and above its Most Favoured Nation (MFN) tariffs.

About 45% of our exports went to the EU in 2015, our imports from them were about 53% of out total. Services made up about 40% of our exports to the EU and 20% of our imports from the EU. These figures are 2:1 in our favour and they might be why today's news contains details of our biggest banks making preparations to move out of the UK.

The head of the British Bankers' Association, Anthony Browne, said "many smaller banks" are planning to move their operations overseas before Christmas.

Larger institutions, he said, are expected to follow within the first few months of 2017.

"Their hands are quivering over the relocate button,"

It is a shocking statement and is being carried by many news outlets. It certainly weakens any negotiating position we might have had on the subject. It says to the EU that if it doesn't deal the banks will move to it.

On another note a Sky poll indicates that 49% of us do not think that the PM has a Brexit plan, but strangely 46% trust her to get the best deal. Talk about confused.

[Suff]

Yeah I should have checked that before posting. 32% on wine to 4.1% on LNG. But with a 20% drop in the £, add 10% on tax and we're to 30% anyway.

However, even 10% is enough to put customers off when they can get a better deal on a UK produced vehicle. If you're looking at £6k more for a mid to high mid range vehicle, you're going to think twice. If it becomes £18k with the drop in the £ and you're going to think more than twice.

As for all those smaller banks moving overseas??? Let's wait and see where they go. After all, the most viable place is Ireland and, as has been proven recently, the Irish have no control over the terms under which they do business with companies. The EU says and that's it. Unlike the UK who would just tell the EU that if it doesn't like it they'll veto it. Let us not forget that Ireland owes the EU a ShedLoad of bailout money and so has to do as it is told.

As for France and Germany with corporation tax around 30% and 33%, they'll think long and hard about how they do this.

I'm getting truly sick of this. I thought Anthony Browne was the head of the "British" Bankers Association. Not an EU paid flunky. His job is to tell the banks that their best bet is to stick with the UK to the very last day then tell the EU that if they want their trades settled and want their transaction clearing done, they have ONE DAY to get it signed otherwise they'll just shut down the transactions and the EU can go to hell on a TGV.

Euro denominated transactions exceed €5 trillion per day. If the banks hold fast and tell the EU that they are not moving and will continue to service those transactions until the last second the UK is in the EU, followed by total and complete chaos until the EU sorts something out, the EU would be FORCED to the table and FORCED to make an exception. They would have absolutely no other option.

It would be better for everyone but the great and powerful in Brussels. Certainly better for the companies. But what do we get? We get this drivel from Browne. If he doesn't want to do the job I suggest that he resigns and gives it to someone who does.

I'm getting heartily sick of it. The CBI said the UK economy would tank the second we said leave and everything would go to hell. Our former Chancellor fell on his sword because of his obvious attempts to blackmail the people and our former PM the same, to a lesser degree.

Shocking? Yes it's totally shocking that our business associations are still working for the EU and not for the UK. That's what's shocking.

[Suff]

Just another little point on that.

RBS failed, after 3 years, to spin off Willians & Glyn and failed miserably at a cost of £1.5bn spent and another £1.5bn committed to complete. Total net sale value of the W&G on the market? £1.5bn with a tail wind. Yes the smaller banks could move more easily but not "that" easily. Even they would need 6 months to a year to move all operations over there.

As for the larger banks? They could not move, lock, stock and barrel to an EU country even in the two years or so we have left before we are hoofed. I've worked in them, RBS, Credit Suisse, ABN, BV bank (now something else after multiple mergers), ING bank, Euroclear. I'll be totally blunt here. They don't move that fast. They can't. The simple logistics of moving data centres takes 2 years minimum and they won't be allowed to keep all those data outside the EU. So it has to go.

They can't even move fast enough to bring regulatory compliance into their environment, much of which is happening in 2017/2018. Yet we're led to believe that they will do a fundamental shift of ALL their Euro denominated operations in just two years.

Yeah, right. RBS has circa 700 applications in it's suite of apps which are used on a daily basis. How are they going to do the Euro separation? It's not just RBS either, they are all like this.

The press and the Business associations make these statement as if you just call in Pickfords and start working in another country. RBS employs circa 100,000 people, ABN about 75,000, Deutsche bank 90,000 etc, etc, etc. The staff employed by the banks on EU trade work must be in the 100,000 number at least and we're expected to believe that these banks will just move them to another country on another contract, in another language (the law demands in these countries), without the Unions stepping in or the companies being sued for billions in the courts for breech of contract.

It Just Does Not Happen that way. The logistics are impossible in the next two years. It simply can't happen. You think even 50,000 people are going to descend on Paris and the surrounding country and find housing? Any more than 50,000 people would descend on London and the south and find housing in the same way.

The reality, if it happens at all? Offices with a few people will be set up in the relevant country and the trades will be allocated to those countries. Oh and the taxes too.

To whit the HUGE articles on EasyJet and the JOB LOSSES that would happen if we left the EU. yet at the bottom of the page you read that it would be 6 - 10 people in an office somewhere in the EU and that no jobs would be lost in the UK and that the centre of operations would remain in Luton....

Before listening to the press and political pundits, it's always good to look at the larger picture and work out if it's even physically possible to do what they are saying.

[Suff]

And now the FT is in on it...

The fundamental problem with the EU these days is that it needs a federal state structure simply in order to exert its basic functions. The EU 28 is a dysfunctional mess in virtually everything it does.

Really? I'd never noticed.... I've only been saying this for a decade or more. Pity the press and analysts had to see TTIP, CETA and Bexit before they realised it...

The eurozone is stuck in a perma-crisis. The EU is pathetically weak towards Vladimir Putin, the Russian president, and largely absent in Syria. Now we know that it cannot even do trade deals.

Quite. The UK, less secure out of the EU? Dream on!

My overall conclusion is that the next phase of European integration — which will happen eventually — will have to be preceded by a period of disintegration. Brexit was only the start.

Well we can always hope. I've also said for a decade or more that the EU needs to be torn down and done again properly and if it were done properly I might even consider the UK joining again. But there would have to be some seriously marked attitude changes if we did. Something like votes per GDP or something like that. More success, more say and if the others can't make a contribution then they get what is on offer. They could always leave and make it on their own.