WTO rules would give us the freedom of making our own trade arrangements around the world, where 90 per cent of future growth will take place. Most of the world operates on WTO rules – it is perfectly sensible for us to do the same.
We would also have the ability to unilaterally do away with EU imposed tariffs, thus reducing the cost of food, clothing and footwear by an average of around 20 per cent. This would boost the economy by two per cent of GDP all in one go, and help the poorest in society.
Britain could also implement deregulation, take back our fisheries, and cut tax for business using our repatriated net contribution.
The alternative would be a potential disaster. Delay all this by having an interim period while paying for the privilege, possibly as much as £65bn by some accounts (£1,000 for every person in Britain), have no say in decision making, and likely be restricted from implementing the economic benefits of leaving.
In other words be worse off.
WTO terms mean instant tariffs on trade with our biggest market. Want to buy a German car? That will be an extra 10 per cent. Belgian chocolates? That’s 20 per cent more. There are no WTO rules governing airlines, so unless a separate aviation deal were struck, planes would be grounded. Adieu easyJet, auf wiedersehen Ryanair.
That’s not to mention the barriers put up by leaving the Single Market. Businesses exporting to the EU would still need to meet EU regulations, but what happens when UK regulations start to diverge, and businesses have to comply with two sets of rules? So much for getting rid of red tape.
Meanwhile, the WTO itself is under siege. Donald Trump’s “America First” administration has been vetoing appointments to the WTO’s court, which could grind to a halt by next September. The White House is slapping unilateral tariffs on companies like Bombardier which it thinks threaten US businesses. If things continue like this, we won’t have a WTO to which to default.
This isn’t a future we should be considering. As a minimum, we need to stay in the Single Market. Better still, we should have an exit from Brexit.
December 4th, 2017: CityAM