As Britain slowly stumbles towards a no-deal exit of the European Union and its successful Single Market and Customs Union, Leave voters are desperately reassuring themselves in their echo chambers that trading on just WTO terms after the 27th of March 2019 is not all bad news. “We’ll trade with the world”, they say. As if the gravity model of international trade in international economics no longer exists after Brexit.
An example is a little iPhone video posted by a British ‘Yellow vest’ of all the fresh exotic vegetables ‘not from the EU’, that he could find in his local Tesco fresh fruit and veg racks. The irony of a Yellow Vest revelling in the abundance of Peruvian asparagus tips and Kenyan broccoli spears would not go unnoticed, should any real French ‘Gilet Jaune’ stumble upon it.
A short video of non EU produce for sale in a typical UK Supermarket with following comment:
“PROOF: We won’t all starve when we finally leave the #EU, this is World Trade.
The scaremongering by the fake news mainstream media has to stop!”
Let me try and explain this Peru asparagus tip phenomenon for simple Leave voters:
I will use a simple example of supply and demand pricing that most will be familiar with: You can fly with RyanAir to France for €9.98 on some days when demand for flights is low. During school holidays however like on April 19th just before the Easter break the same flight is €96.89 or ten times as high! The flight price point for RyanAir to break even on its flights to France is probably somewhere comfortably in the middle.
Same with asparagus tips from Peru and beans from Egypt. Sometimes passenger airlines have a few ton spare freight capacity and clever buyers at UK Supermarket chains exploit that price anomaly to cheaply transport speciality food to UK that usually you would not see out of season on our supermarket shelves. You cannot however ship crates of one pound cauliflowers, bags of potatoes and apples that way. There just isn’t the volume of airfreight available. There aren’t enough planes in the sky, to replace the thousands of lorries of fresh produce that arrive from France Italy and Spain every day of the year. Keeping UK PLC. supplied like that is not sustainable! The UK’s food supplies are another example of carefully crafted ‘Just in Time’supply lines built up over the last 40 years of EU membership.
Think also of the carbon footprint of food being flown in like that in bulk. Imagine the lorry queues at Heathrow and Manchester Airport! It all doesn’t bear thinking about it!
Leave voters of the Hard Brexit WTO variety are also too too stupid to realise much of this stuff on the videoclip is only available because of EU trade agreements with Africa and South America, Free trade Agreements for everything but arms, from which the UK as a current EU member benefits. If Brexshit happens there won’t be any agreements in place on day 1, so UK can’t import it unless it pays the relevant tariffs, which can go as high as 40%!
Trade Agreements can take years to agree. Any free trade agreements have to be carefully balanced with the threat to our own farmers and industry, many would be forced into bankruptcy in the face of cheap foreign imports. The EU usually gets this balance right. For instance oranges from Morocco only attract a small tariff during the few months the Spanish orange growers are harvesting. This assures these farmers don’t go bust, but yet we can enjoy cheap fresh oranges all year long.
We also had a discussion about cheaper wine from outside the EU. Non perishable foodstuffs like wine can indeed be shipped in by climate controlled containers, but let’s face it, the amount of duty U.K. government adds on top of any alcoholic beverage makes those tariffs pale into insignificance. See for example this €1.79 bottle of rose wine. Where could you find that on U.K. supermarket shelves. The myth that food and drink will be cheaper in UK after Brexit must be one of the most insidious lies ever to be perpetrated on a gullible UK public.
Finally an infographic of the free trade area that UK plc. will lose access to if it crashes out without a deal in six weeks time. I have added in Japan, a huge economy that EU yesterday signed a free trade agreement with.