Attached is a Brexit Report written by Roger Martin-Fagg & distributed in association with Sourcing City. Roger’s report is purely an economic view of the history of the EU, and his thoughts on the possible scenarios’ following an ‘In or Out’ outcome in the EU Referendum.
The opening paragraphs of the report contain much detail on how the market currently operates. Later in the report (from: ‘The main Brexit arguments’) it becomes an easier read.
In summary, Roger points out that the UK runs a trade deficit with the EU, but a trade surplus with the rest of the world. The EU accounts for a diminishing proportion of UK overseas trade, and Cars and Pharma are the UK’s biggest manufacturing exports but overseas sales of business services are 50% larger than either. We have significant comparative advantages in services. After the US, Europe is the biggest global market for services. The biggest customers for our services exports are the USA, Saudi Arabia and Ireland. The Netherlands and Switzerland are also big customers, but not necessarily the final consumers.
The dominant economic issue for the UK is how to maintain access to the world’s biggest market if we’re no longer in the club.
Much of what Roger writes is likely to raise concerns for business owners in leaving the EU, but as Roger himself says; “…as you know economists are famous for getting things wrong!”
In our view, David Cameron did not get close to the deal he wanted to negotiate with the EU, and he is now faced will selling the little he did get. This seems to indicate that the EU are unwilling to relinquish their control of the member countries and indeed may want to push further towards a Federal Europe, potentially including reforms like common taxation.
The EU Referendum has many facets to consider outside of the economic outcomes. Issues like; ‘UK Sovereignty’, ‘Control of our borders’, ‘National security’, ‘Judicial power’, and ‘The knock-on effects of the Euro crisis’ are just some of the subjects that voters will be considering.
It seems that most voters are still trying to gather facts to decide their final voting decision. It is clear that misinformation is already being traded by some politicians, and hearing some views stated as ‘facts’ is particularly irritating as this can form an unfair influence on people. The reality is that in some instances ‘facts’ simply do not exist as we are moving into unknown territory one way or another.
The UK has a history of low voter turnout and the way people vote is often influenced by emotional feelings at the time. Also, when faced with the unknown, most people are likely to ‘stick with the devil they know’ and the status quo prevails. This game obviously still has a long way to run.
As everyone wades through this complex quagmire, people will ultimately make their own decision. Author, Fredrick Forsyth had an interesting view on a recent Andrew Marr Show, basically he said; – In the final analysis all votes ultimately come down to two choices for the future of our country: ‘A UK parliamentary democracy’, or ‘A federal partly-unelected bureaucracy’.
A free complimentary copy of Roger’s full report can be found by clicking here.
Note: We have known Roger for numerous years & have regularly used the information in his reports to form our own opinions when making our own business planning decisions.
Published on: March 23rd, 2016