Brexit: Who Needs The EU When We’ve Got China
Leaving the EU is going to force the UK to broaden its view on who it should trade with. Economies such as North America, China, South Asia, and even the rapidly growing African economy have — to a greater or lesser extent — been entirely ‘blocked out’ by the trading rules from within the EU.
This has forced the UK to be heavily, almost entirely dependent on its financial sector to prop-up the economy. Hence there problem with an economy heavily weighted towards London, whilst the more industrial and manufacturing focused North has suffered through decades of neoliberal austerity. A rebalancing of the economy towards exports of quality goods and services is now what is needed. Pre-fabricated homes, bicycles, clothing and fashion, high tech engineering, energy storage and generation — the list of industries which have been underfunded goes on and on. Even the film industry, which granted has been buoyed by the occasional influx of EU money, has really suffered with the strict rules of the EU. The British Film industry was at one time leading the world, now it is reduced to a ‘carrot on stick’ post-production facility. It’s huge potential for English language films, conceived, written and produced in the UK, has been woefully underfunded.
Currently of course, the shockwaves of Brexit are contracting the manufacturing industry. This is understandable given the hyperbole regularly espoused in the media about the effects of Brexit. Much like the initial shock which hit the FTSE 100 and 250 — a recovery will soon follow. Especially when you consider that the fat has finally been cut from the pound, making Britain competitive as an exporter on a global (not EU focused) market.
Let’s be clear about the EU — it’s growth has stagnated for years now. The Greek problem, the issue of huge economies bundled hopelessly together with smaller ones, has never been solved. Asia is growing incredibly quickly — why not build a dynamic relationship with emerging Asian economies? Lets not forget the pace that business can now grow and develop thanks to incredibly quick online services such as Alibaba. Of course it isn’t the golden bullet, but it, and technology like it, is a guide mark for where the global economy is headed; rapid, online, free trade. Something entirely at odds with an old school trading bloc which grows a new grey hair each day.
Capital Economics has recently raised its export growth forecasts to 9% for 2017. Before Brexit the forecast was 7.9% . EU rules didn’t allow for the favouring of a domestic industry over a European one — what a catastrophe that has been for UK industry. Something which can surely now be reversed, with British Steel being once again a rock solid industry. The U.K. government “was very keen to achieve a rebalancing of the economy, but favouring a domestic industry would be discrimination within the single market,” said Prof. Whyman of the University of Central Lancaster — a voice universally ignored by the press.
Why has the UK been exporting more Ireland (with a population of 4.6 million) than to China? Good things await, the new economic reality will just take time. And what about poor lowly Canada? Six years has passed and STILL there is no EU trade deal. This opportunity can quickly be jumped upon if the UK acts immediately. Perhaps the Tory Government, who look like a rabbit in the headlights, are not up to the job…
“The EU record on trade deals was absolutely atrocious,” were the words of Gerard Lyons, the former chief economist at Standard Chartered. If only the UK Government could demonstrate a clean break from this history of poor (and slow) negotiation, then there will surely be good things on the horizon.
The Brexit fall out is largely a cultural one. That is understandable. Many people feel they have lost a connection to the continent, and the xenophobia and outright racism the vote has sparked really have been awful. It’s time for the progressive minded people from the UK and beyond to come out in defence of Brexit, and reclaim the language of the debate. This is not about ‘sending people back’ or any of the other horrible lines cooked up by right wing idealogues. This is about rebalancing an economy that was being dragged in the wrong direction.
