I’m struck, as the British parliament moves towards the endgame on Brexit, with the number of times Australia, Canada, New Zealand and India have been advanced by the Brexiteers in the public debate as magical alternatives to Britain’s current trade and investment relationship with the European Union. This is the nuttiest of the many nutty arguments that have emerged from the Land of Hope and Glory set now masquerading as the authentic standard-bearers of British patriotism. It’s utter bollocks.
If Britain proceeds with giving effect to what future historians will legitimately describe as the longest suicide note in history by leaving the union, the cold, hard reality is that the mathematics simply don’t stack up in terms of credible economic alternatives to Europe. Much as any Australian, Canadian and New Zealand governments of whichever persuasion would do whatever they could to frame new free-trade agreements with the UK, the bottom line is that 65 million of us do not come within a bull’s roar of Britain’s adjacent market of 450 million Europeans.
As for India, good luck! India’s trade and commerce bureaucracy is the most mercantilist and outright protectionist in the world. They virtually single-handedly sank the Doha round in 2009. In the same year, as prime minister of Australia, I launched a free-trade negotiation with Delhi. But a decade later, those negotiations remain at a standstill. The Australian economy is only 50% the size of Britain’s. A substantive India-UK FTA is the ultimate mirage constructed by the Brexiteers. It’s as credible as the ad they plastered on the side of that big red bus about the £350m Britain was allegedly paying to Brussels each week. Not. [Continue reading…]