Friday, 10 December 2010

Balance of trade - UK vs EU

One of the most important policies of the BNP is leaving the European Union. This is because we see no reason to be governed by foreigners, and have no desire to govern them. BNP policy is that we would remain within the free trade area (aka the customs union) and so trade would be unaffected.

However, the EU could try to make that difficult for us, so it's worth looking at what the implications would be of them saying, "no deal, get lost entirely." If the UK had no trade with the EU, would we gain or loose?

Here's a map showing trade balances with the EU for 2009. (You may need to click on it to see a bigger version.)

The countries shaded red or pink have a negative trade balance with us, ie, we lose out trading with them. The countries in grey are positive, we sell them more goods and services combined than they sell us.

Clearly in the EU only the Republic of Ireland and the Netherlands are significant to us, although Sweden, Finland and Romania are slightly positive. All the other countries are either slightly or strongly negative - we lose money by trading them.

Now let's aggregate that by looking at the same maps for the entire world.


From the upper image you can see we are negative overall with respect to the EU and Asia, but positive with Africa and Australia/New Zealand.

The lower image shows that we are positive with respect to all the Americas and the USA is our most important trading partner.

Here's a table showing the actual value of trade with our beneficial partners (2009).

The "profit" is how much more we sold them than they sold us. Contrast the above table with the same for our two big neighbours.

So you can see that if we cut off trade links with the EU we would lose £14.7bn profit from Ireland and the Netherlands, but gain by not making a £18.7 loss on trades with France and Germany, and of course gain even more from not trading with the other EU countries.

All this means the EU is very unlikely to make it difficult for us of we choose to leave. They would just be hurting themselves.

Two other factors need considering.

1) Most of the UK's exports are "services" while our imports are "goods". Goods are easy to block with trade barriers because they are tangible, services are not. Services can be sold through a front company in the target country. For example a UK software house employing 1,000 people could start a ten person company in another country and pipe the software in through the internet. Financial services can be slipped under borders in much the same way.

2) The UK is Europe's premier tourist destination by value. Foreign tourism is worth £115bn a year to us and the UK leaving the EU free trade area wouldn't change that.

So putting it all together we have little to fear from leaving the EU.

Now if someone were to suggest joining the North American Free Trade Area (NAFTA) that would be an interesting option to explore.


Anonymous said...

This is one area where I simply do not trust the BNP. As they say on their website:

"Accordingly, the BNP calls for the selective exclusion of foreign-made goods from British markets and the reduction of foreign imports. We will ensure that our manufactured goods are, wherever possible, produced in British factories, employing British workers."

How does this tally with wanting to remain within a free trade area? It's positively protectionist.

It's why I opt for UKIP (and vote) for UKIP rather than the BNP, they want to pull out the EU, aren't scared to stand up for common sense in the face of PC tyranny and they're true free marketiers.

I respect Nick Griffin as somebody that is intellectually honest, -even though his honesty gets him in trouble- but I would be much happier if men like him were part of UKIP.


Nationalist said...

Chef, I’m not at all sure what UKIP policies are, over and above leaving the EU. I’ve heard Nigel Farage refer to UKIP as “the BNP without the racism,” but maybe there are other significant policy differences (not that the BNP is actually racist!) Certainly it seems to me that opening your borders to free trade with another country tends to equalise the standard of living between the two countries – so is a bad idea if you’re planning to do it with a much poorer country. However free trade with an economic peer, or a richer nation, is beneficial.

Anonymous said...

Oh - come on - I've been advocating Britain becoming the 51St State for years. We get the royals and let's face it that Kate girl is kind of pretty. You get free trade with us and those Canadians, reunification with the colonies and a constitution.

Come to that let's invite Australia and New Zealand along for the ride, their economies are pretty much a rounding error and we could use all those raw materials we could call it the English Speaking Union (or EU for short).

Of course then Britain would be full of illegal Mexicans instead of towelheads, but at least they are hard workers and don't go around blowing things up (well except in Mexico).

- Dumb American

Nationalist said...

OK, I'd go for that just to get the right to bear arms.

Don't forget, we get 100 congressmen according to the current apportionment!