Q: Why should the UK pay a hefty Brexit exit fee and then be told we cannot have free trade with the EU post exit?
When you have a phone contract and pull out early. You are expected to pay the remaining cash. That commitment left on the EU “phone contract” is 60 billion. They work off 7 year budget cycles, hence all member states commit to paying into the budget for 7 years (like your 2 year phone contract). The remaining period after we leave is around 60 billion and truth be told, that’s a fair number, as that 60 billion accounts for the rebate. They could tank the rebate and ask us for the lot and it would be closer to 90 billion.
We had John Redwood MP, who has a DPhil in History (pretty much the most useless subject when it comes to calculating economic penalties) claim that we shouldn’t be required to pay. Then he made a threat. Which was that the EU would have no way of enforcing it (basically hinting that we will just leave and keep the debt open — akin to ‘what are they going to do about it?’).
I cannot confirm for 100% certainty whether this is true or not, but I am pretty damn sure it is BS, since the EU and UK will be trading under WTO terms and here is the WTO position on it (note, everyone is a member of the WTO who is currently a member of the EU — 164 countries make up the WTO membership and we’re in it).
So if Redwood wants May to play that card, the EU hard Brexit, so we trade under WTO rules, then we can be chased for it. It’ll be 27 countries against 1 and with it being so high profile, we’d lose with the other 136 other countries too. That dispute position isn’t a negotiable position in the WTO. If we continue to breach policy, we will be required to pay both interest and compensation on top of the 60 billion. If we still fail to fulfil that obligation, the WTO have recourse to block import of the country’s goods to any other member or conduct sanctions akin to those imposed by the UN on rogue states.
If you didn’t want the exit fee, keep your phone!
Like this? Help a guy out and hit the hear!