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No deal advocates have no plan for no deal.
Never mind the more excitable stories, the following WILL happen in a no-deal Brexit
UK products will face tariffs if sold into the EU - for example cars at 10% and shoes at 8%. Some UK producers will become uncompetitive when facing these tariffs, especially compared to EU producers, and will therefore cease production
UK products which require testing to be placed on the EU market will need a test carried out within the EU, a UK test will not be sufficient. This will add costs to production.
There will be no customs cooperation between the UK and EU, thus for example no mutual recognition of the Authorised Economic Operator scheme. Products are therefore likely to take more time to go through customs checks
UK agricultural exporters will face potentially even higher tariffs, such as 42% on cheddar cheese. Our access to the lower tariff rate quotas is uncertain, without which many agricultural exports will be incompetitive
There will also be extensive checks on EU agricultural exports to the EU, which will further add costs, and there will not be veterinary equivalence schemes in place to facilitate these
UK service providers will not have the right to sell certain services across the EU, particularly direct from the UK. In many cases they will have to set up new offices in the EU
Many UK based staff will not have the right to work across the EU, for example as tour reps for UK travel companies. EU citizens would have to take these roles
UK haulage companies would not be able to carry loads between EU destinations, and could for the short term only carry from UK to an EU destination and return. This will make them uncompetitive to EU hauliers
The tariffs on goods, and restrictions on services, will also apply to countries with who the EU has a current trade agreement that the UK fails to replicate - for example there is likely to be no agreement with Turkey
In no-deal Brexit there will be no agreement with the EU on data adequacy or financial services equivalence. This will mean extra cost for all UK companies who move data between UK and EU for example
The UK Government will have to decide on whether to keep or reduce our own tariffs. This will not be an easy decision - lower tariffs may help consumers but harm UK producers and developing countries who currently get particular privileges
Over 50% of UK trade will be affected by these changes. Less than 10% of EU trade will be affected by these changes. UK costs will rise, EU costs are unlikely to do so. This will be a major change to the terms of trade between us
These issues are why even no-deal advocates talk of 'managed no-deal', or a deal with the EU. But if all of this is going to affect the UK more than the EU there is no reason for the EU to offer a more generous deal than that on offer now
All of these are the sort of issues which are typically resolved in a free trade agreement. But these take time, typically in the EU 5-7 years. Waiting this time would mean all of these issues being maintained, affecting UK competitiveness
Some no-deal advocates claim the UK could gain competitiveness by scrapping EU regulations, however it would be difficult then to negotiate a trade deal with the EU at the same time.
The UK is expecting to start Free Trade Agreement negotiations with US and others in a no-deal situation. However if the UK economy is changing it will not be clear which sectors the UK should prioritise.
Well known incompatibilities between US and EU will also cause problems, if we accept US agriculture this will make a good trade deal with the EU harder. It will take time for the UK to make these decisions
As from the date of a no-deal Brexit UK companies will have no easy redress for business issues in the EU or countries with whom there is no trade agreement e.g. delayed containers, staff refused permission to work.
The UK Government will have to take business issues up diplomatically with the EU, a process that typically takes a number of years to resolve individual issues. EU Single Market tools like Solvit will not be available
It is all of these reasons - not even the more excitable shortage stories - why the EU believes the threat of no-deal to be non-credible. They believe that no UK Government could survive the economic harm likely from the above
There is no plan from no-deal supporters to address the issues outlined above. The Government's plan is to hope the absolute worst doesn't happen, but they also have no realistic future plan
No-deal puts up a high economic barrier between the UK and our largest and nearest trading partner. This cannot be a sustainable long term position, and never has been in 2000 years.
As workers and consumers no deal has the potential to cause problems for millions in the UK, particularly if it happens in less than two months. This is now the key message that needs to be spread
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