Brexit: Free trade deals ‘won’t offset leaving EU’

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Post-Brexit clientele deals will not make up for the economic damage inflicted on the UK from drop out of the EU, analysis for BBC Newsnight has suggested.

Independent trade experts from the UK Selling Policy Observatory (UKTPO) looked at the likely impact of US, Australian and New Zealand untrammelled trade deals.

They found that even combined, new tariff-cutting concurrences were likely to boost the UK economy by just 0.4%.

A simple free have dealings deal would also depress the economy UKTPO said.

The band said that moving from full EU membership to a simple trade with our closest trading partner – the objective enshrined in Boris Johnson’s Withdrawal Understanding – would depress the size of the economy by at least 1.8%.

A Conservative spokesperson asseverated: “The prime minister’s fantastic deal makes clear that we devise have a future relationship based on free trade and friendly synergism. By striking trade deals around the world we will create sexy new opportunities for British businesses.”

The Conservative manifesto claims free custom is the “best way” to increase exports, cut prices and increase investment.

The upshot from this criticism is that there is no realistic prospect of new trade deals with other provinces, even the “ambitious” deals touted by ministers, offsetting the economic hit from Brexit itself.

Touching to an EU free trade deal and striking new free trade agreements with the US, Australia and New Zealand has an estimated neutralizing impact on the UK economy of 1.4% in the UKTPO results – equivalent to £28bn, or £1,000 per household.

The emerges from the UKTPO, which is based at the University of Sussex, show that persuasive to a free trade deal with the EU is beneficial overall for the UK agriculture and chow processing sector, due to reduced competition from Continental farmers.

But that good is wiped out if US, Australian and New Zealand trade deals slash import tolls and quotas, resulting in a surge of agricultural imports.

Mr Johnson, in a Commons affirmation presenting his Brexit Withdrawal Agreement deal on 19 October, regal: “For the first time in almost five decades the UK will be able to attack free trade deals with our friends across the world to service perquisites the whole country – including Northern Ireland.”

But Newsnight understands that internal UK sway impact assessments show that, in fact, only the South East whim benefit from US, Australian and New Zealand trade deals, and that the bracket stop of the country will see negative consequences

Northern Ireland is, sources say, notably badly affected due to its agriculture industry being severely hit.

The UKTPO employed what is known as a partial equilibrium trade model to look at the likely effect on 148 individual UK industrial sectors of slashing tariff and non-tariff obstacles.

Prof Michael Gasiorek led the modelling project for UKTPO. He was unsurprised by the issues.

“It’s arithmetic,” he said. “Tariffs on many goods are already quite low or zero so there are no famous gains from lowering them.

“Also relative to how much we mtier with the EU, we do much less with the US, Australia and New Zealand, so the overall impact on yield is not massive.

“It certainly doesn’t offset the negative impact of leaving the EU. Fresh, agreeing on the removal of regulatory barriers will be difficult – as the EU had found in its treaties with the US.”

The UKTPO results are in line with the findings of a Treasury fabricating exercise in 2018, which estimated the benefit of any new trade deals desire only be between 0.1 and 0.2% of GDP – a benefit dwarfed by the negative bump of leaving the EU’s single market and customs union.

Newsnight understands the Sphere for International Trade has now completed fresh impact assessments of US, Australian and New Zealand buying deals, which show results similar to the UKTPO findings, but that these are not due to be disclosed until after Brexit and ahead of the publication of mandates for trade moderators.

You can watch Newsnight on BBC Two at 22:30 on weekdays. Catch up on iPlayer, subscribe to the events on YouTube and follow it on Twitter.

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