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Bremoaners and Brexiteers shooting each other in the foot.

Thursday, October 13, 2016 8:24
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Going back to that BRC letter

Falling back on to WTO rules would also increase the cost of sourcing from beyond the EU. The import cost of women’s clothing from Bangladesh would be 12% higher, while Chilean wine would be 14% dearer for importers.

Yes, we would expect the UK to remain a member of the WTO which is an advisory/co-ordinating body rather than a supra-national quasi-government. The obvious point is that the WTO has no rule stipulating minimum or default tariffs.

(Nobody questioned why the BRC specifically mentioned Bangladeshi clothes or Chilean wine. It turns out that they were cherry picking:

Bangladesh has been a WTO member since 1995 and, as a least developed country, benefits from the EU’s “Everything but Arms” arrangement, which grants duty free, quota free access for all exports, except arms and ammunition.

The EU and Chile concluded an Association Agreement in 2002, which included a comprehensive Free Trade Agreement that entered into force in February 2003. The EU-Chile Free Trade Agreement is broad and comprehensive and covers all the areas of EU-Chile trade relations.)

Daniel Hannan, who is good on principles but useless on facts fell for it, as gleefully reported by The Daily Mirror, and tweeted thusly:

This is idiotic. Chilean wine 14% more expensive? It’s currently subject to a 32% EU tariff, which we can now scrap.

Haha! cry the Bremoaners, he didn’t know that there was an EU-Chile FTA! Others pointed out that the EU default tarrif on wine is 8p per bottle (although some official sources did incorrectly give the figure as 32%, which is about par for the course for EU tariffs on food, so a forgivable mistake on Hannan’s part). So, they argue, Hannan’s lack of grasp of finer detail undermines his general point! No it doesn’t. His general point was and is sound.

And so bloody what? The BRC were clearly cherry picking examples, thus making their whole letter questionable, and they still haven’t explained where it says that WTO members must impose a minimum tariff of 14% on imported wine. Because it simply doesn’t, I’ve checked.

The final point is the general principle of continuity of international treaties, so if the UK leaves the EU, we are then almost automatically in a UK-Bangladesh FTA and a UK-Chile FTA on the same terms and conditions as the EU-Bangladesh FTA or the EU-Chile FTA, and so on, until and unless one party abrogates it.


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