World Trade Organisation Rules

wotsthat

buglawton wrote: »

Remember, import tariffs are optional and their real purpose is as a quid pro quo device to encourage our WTO or other customer countries to play nice with us, or to protect/porkbarrel our own weak sectors.

VAT & duties can be played with so the consumer need not feel too much pain.

Also worth noting that the 5% or 10%, whatever, import duty is usually on the wholesale, not retail price for goods destined for our shops & car showrooms.

As you say tariffs are primarily, in theory, intended to favour the production of locally produced goods. You're then saying it's possible to effectively compensate the consumer which rather defeats the object.

It's not hard to imagine the longer term consequences of this if the EU taxes our exports but the UK effectively reimburses consumers for any tariffs imposed.

CLAPTON

wotsthat wrote: »

As you say tariffs are primarily, in theory, intended to favour the production of locally produced goods. You're then saying it's possible to effectively compensate the consumer which rather defeats the object.

It's not hard to imagine the longer term consequences of this if the EU taxes our exports but the UK effectively reimburses consumers for any tariffs imposed.

thats very true
so in practice it will encourage home grown production and discourage imports : not wholely bad then although I do prefer free trade.

martinsurrey

Rinoa wrote: »

Financial services are very important. But we're the ones with the expertise.

So the bankers and financial services personnel that are so vilified by the UK press and public are now part of "we"...

Its a short hop across the channel to Paris and Frankfurt they'll already be planning the red carpet...

CLAPTON

martinsurrey wrote: »

So the bankers and financial services personnel that are so vilified by the UK press and public are now part of "we"...

Its a short hop across the channel to Paris and Frankfurt they'll already be planning the red carpet...

was there anything to stop them hopping before now?

rubuhoeikanaika

CLAPTON wrote: »

was there anything to stop them hopping before now?

No, but there was no need to either because they could do all their business from London. If the City loses passporting rights and especially if we leave the single market, then their institutions will have to relocate, and they may not want to deal with getting a work visa.

London has only really been a financial services powerhouse for a couple of decades. It wouldn't take much to dislodge it, since so much of it is based on network effects of having so many people in the same city. Look how quickly myspace collapsed.

wotsthat

CLAPTON wrote: »

thats very true
so in practice it will encourage home grown production and discourage imports : not wholely bad then although I do prefer free trade.

It will only encourage home grown production if consumers pay a higher price for imports and there's an alternative. If, as being discussed, there's a mechanism to compensate consumers for any tariff imposed then that incentive is removed so exports will fall and imports won't.

Yes, free trade would be a few orders of magnitude better.

martinsurrey

CLAPTON wrote: »

was there anything to stop them hopping before now?

no but did they have a need to move?

rubuhoeikanaika wrote: »

No, but there was no need to either because they could do all their business from London. If the City loses passporting rights and especially if we leave the single market, then their institutions will have to relocate, and they may not want to deal with getting a work visa.

London has only really been a financial services powerhouse for a couple of decades. It wouldn't take much to dislodge it, since so much of it is based on network effects of having so many people in the same city. Look how quickly myspace collapsed.

Add onto this, go into any bank in the city and about 50% of the employees will be immigrants from all over the world, EU, commonwealth, and everywhere else.

A key plank in leaving is getting the total numbers down, would a bank want to focus its workforce in a country where the total number of visas is limited?

CLAPTON

wotsthat wrote: »

It will only encourage home grown production if consumers pay a higher price for imports and there's an alternative. If, as being discussed, there's a mechanism to compensate consumers for any tariff imposed then that incentive is removed so exports will fall and imports won't.

Yes, free trade would be a few orders of magnitude better.

true

It make no sense for the government to compensate people for import tariffs decided by that same government.

In my view the pound will stay at a lower level, as it was, anyway, due a fall, due to the large trade deficit. Brexit has simply brought forward the inevitable.

So a lower pound will make imports dearer, exports cheaper (or more profitable) and people will substitute UK products for imports. Unfortunately nothing we can do about essential imports except limit immigration as soon as possible to stop the situation getting worse.

rubuhoeikanaika

Agree that the pound falling is potentially a good thing. However much of Britain's goods exports involve the highly integrated European supply chain. It's highly unclear how much stuff is actually 'made from scratch' in the UK as opposed to simply assembling a lot of stuff made elsewhere. That stuff will become more expensive too with a weaker pound, dragging on any positive effects for exports.

setmefree2

Alan_Brown wrote: »

I found this on the BBC: http://www.bbc.co.uk/news/business-36470809

"Britain could have to impose £9bn worth of additional tariffs on imports. Exporters could face an extra £5bn of tariffs on their sales abroad."

I'm not sure if these figures are accurate, or whether I'm interpreting them correctly, but are they saying that the UK would gain a net £4bn between export and import duties?

I'm no expert on international trade, so I'm hoping that someone on here has a better idea of whether this theory is right, or totally wrong.

Well it's quite possible that none of the above trade would take place at all. So if a German car is 10% more expensive than now - you might by an American car instead.