Because already, for the UK, EU trade is shrinking and world trade is growing to the point where UK exports outside the EU are already 50% greater than UK Exports to the EU.
This article is based on a series of briefing notes from “Global Britain”, one of Leave.EU’s affiliated organisations to whom I am indebted for all the hard work of uncovering the facts. Never mind Nick Clegg’s ‘Billy No Mates’ suggestions and his supposed 3 million “lost” jobs, Britain is already on its way out into the world, making the EU irrelevant to our world trading position.
On top of our exporting more out to the EU, we are also importing increasing amounts from the EU, meaning that the UK is in surplus with the world outside the EU and in heavy deficit with EU countries. The UK being in the EU is good for the EU member states, not for Britain.
For a start we pay dearly for the privilege of their exporting to us on preferential terms:
|UK Cash Contributions to & Receipts from “Brussels” in 2014|
|£ million in2014||£ m per day in2014|
|Receipts from EUInstitutions||(7665)||(21)|
Our net contribution would have bought over 350,000 nurses or 137 Typhoon fighter jets or the whole Trident replacement programme! And these net contributions are growing, by 20% since 2010.
But now let’s take a look at the exports. Remember years ago all that the papers worried about was our balance of payments? Well, they don’t any more, but we need to worry about it again:
|Table 1: Value of UK Worldwide Exports1 £ bn|
|Year||UK exports to EU||UK exports to RoW||UK exports to World|
The table is indexed around 2008, the pivotal year in terms of the recession.
As can be clearly seen, our exports to the EU are effectively static (in actual value, but inflation has reduced the amount of goods for that sum) while exports to the rest of the world are growing twice as fast, meaning that the percentage of our trade with the EU is shrinking. On top of this there is the Rotterdam-Antwerp Effect, which is worth about 3%, with the EU counting British exports that are shipped through Netherlands deep-sea ports being exports to the EU!
This means that in reality 60% of our exports went to the rest of the world, and only 40% to the EU.
For some reason, it all changed after the recession. Before then, our exports to both the EU and the Rest of the World were growing equally, but after the dip, our external trade rocketed, while EU trade remained sluggish. In 2014 the value of UK exports to the EU was 18% lower than in 2008, while in contrast, indexed on 2008, UK exports to RoW in 2014 were greater by 3%.
And here are the numbers that the papers used to worry about:
|UK Current Account Balance with EU-27 & RestofWorld £ bn|
We are exporting more and more to the rest of the world, in relation to our imports from them, despite the vast volume of manufactured goods coming from China. Meanwhile, the EU countries use their preferential arrangements to shovel more and more goods at us.
I’m part of that export boom – I work on BAE System’s contracts with Saudi Arabia, worth around £4 Billion a year. Just one contract with one country! And it’s likely to get bigger too.
Let’s illustrate the problem a little more with the “winners” and “losers” in our race to sell more to other countries:
|Balances: Largest UK Surpluses & Deficits in 2014: £bn|
|China + HongKong||17|
OK, the USA is a large country, so it is not surprising we export a lot to them, but little Switzerland, a small country, in Europe too but NOT in the EU. Meanwhile, on the deficit side the world’s biggest exporter to us is Germany. Yes, they offer quality products, like their cars, but they benefit from the double whammy of EU preferences and being top-dog in the Eurozone, while paupering the southern Europe nations who are Eurozone members.
Let’s look at it by region of the world now, where are we doing best? Here’s the compounded annual averages over 10 years, for goods, services, income and transfers:
|North & SouthAmerica||3.4%|
Another factette: UK export growth to China+Hong Kong is six times that of Germany.
We are doing well with some EU member states but they are mostly the new members, for example: Latvia, Lithuania, Estonia, Croatia and Slovakia (over 10% annual growth) but they are small, while to Germany, Finland, Italy, Austria, France, Spain and Belgium our exports have grown by less than 2% per annum (worth less than inflation) and are in decline with Portugal and Greece.
I could throw more and more figures at you, but they all prove the same point:
The EU is a busted flush in trade terms. It’s time for Britain to get out into the World again!