Dear Subscribers,
The US has imposed 25% tariffs on imports from Canada and Mexico and 10% tariffs on imports from China. He is also threatening to impose similar tariffs on imports from the EU. There has been no mention so far of tariffs on imports from the UK, perhaps because, by some estimates, the UK is one of the only wealthy countries with which the US has a trade surplus.
Trump gets serious on trade.
The High Court has annulled two licences to drill for oil in the North Sea on the grounds that environmental impact assessments had not been properly taken into account. The regulatory process will now start again for the two projects, with Ed Miliband having a say on whether or not to approve them. This is a prime example of overregulation holding back economic growth. If the Chancellor is serious about deregulation, she should make an example of this case and see to it that the projects get approval without delay.
A bill introducing new immigration restrictions in Germany was defeated in the Bundestag after CDU lawmakers rebelled against their leader, who had planned to push through the bill with support from the AfD. There is a longstanding convention whereby ‘mainstream’ parties do not rely on votes from right wing parties. This convention was broken on Wednesday, when a non-binding motion on immigration passed with support from the AfD.
Bad blood in the Bundestag
The government of Norway has collapsed over a disagreement about the adoption of EU directives concerning energy into Norwegian law. As a member of the European Economic Area, Norway is obliged to adopt aspects of EU law, despite having no say in how the law is made. The recent chaos should be a warning to those in the UK who see closer ties with Europe as a source of greater political stability.
Media
Charles Moore on anti-democratic consensus
Maxwell Marlow on pointless regulation
Blog
Labour must urgently change course to avert a major currency crisis by Robert Lee
There has been an alarming recent deterioration in the UK’s already precarious balance of payments position. This will not escape the notice of investors, not least predatory global hedge funds. The UK government urgently needs to adopt a credible growth agenda, and though there are signs of a change of course much more is required. If not, a Sterling crisis seems inevitable.
It seems very likely then that Labour’s change of course will be too little too late to avert a major crisis of confidence, most probably centred around the currency. Such a crisis will probably lead to a major split in the Labour Party between pragmatists and ideologues. In that circumstance the Tory Party should be ready in the national interest to support the pragmatists if they propose the radical market-based reforms, more realistic net zero policies and public spending cuts that will then be required to restore stability.
Key Points
5 years after leaving EU, here is a partial list of the benefits that Britain has received from becoming an independent sovereign nation once again:
- New or enhanced free trade agreements with Singapore, Japan, Ukraine, Australia, New Zealand. Negotiations are ongoing with Mexico, Switzerland, Israel, Türkiye, South Korea, India, and the Gulf Cooperation Council.
- Import tariffs removed from 47% of all products coming into the UK, those products being the ones not produced in the UK, making prices cheaper for British consumers.
- Net annual payments of around £10 billion to the EU budget (£200 million per week) have been avoided.
- The end of unlimited immigration from Europe and the introduction of a points-based immigration system which does not discriminate against people coming from non-European countries.
- The introduction of more streamlined regulatory mechanisms for innovative medicines, giving patients access to cutting-edge treatments. A prime example was the Covid vaccine rollout, which saw millions of British people receive vaccines while the EU was still dragging its feet.
- The digitisation of various systems of customs controls, saving importers time and expense at the UK border.
- Entering a trilateral defence and security partnership with the US and Australia, part of which involved a multi-billion pound contract for British firms to build a new fleet of nuclear submarines.
- The introduction of new VAT exemptions, including exemptions for items related to sustainable energy (like solar panels and heat pumps) and women’s sanitary products.
None of these policies would have been possible were the UK still a member of the EU. But by far the most important benefit of Brexit is the freedom Britain now has to make its own laws and act in its own best interests. As the government scrambles for new ideas, they must resist the temptation to outsource policy-making to international bodies in return for dubious promises of economic growth. Instead, they should be glad of the freedom to explore and experiment with the possibilities that full discretion over national law opens up.
