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REVEALED: How Britain can WIPE OUT trade cost of leaving EU and be better off in ONE MOVE

BRITAIN could wipe out any trade costs incurred from leaving the European Union on day one of Brexit and end up substantially better off in one fell swoop, a leading trade expert has revealed today.

Professor says post-Brexit deals will have ups and downs

BRITAIN could wipe out any trade costs incurred from leaving the European Union on day one of Brexit and end up substantially better off in one fell swoop, a leading trade expert has revealed today.

Top financier David Coker told express.co.uk that Theresa May should ditch the Brussels single market and instead seek membership of the lucrative North America Free Trade Association (NAFTA).

He said the increase in UK exports that would result from more trade with its three other members – the US, Canada and Mexico – could easily “wipe out” any deficit caused with Europe.

Mr Coker, a former Vice President of Deutsche Bank and high ranking official at the global credit ratings agency Moody’s, made the remarks after a top Republican said Donald Trump was ready to seal a deal with the UK.

Theresa May and Donald TrumpGETTY
Theresa May should apply for membership of NAFTA, a trade expert has said
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The possibility of Britain joining up with NAFTA, which unlike the EU is a purely economic organisation with none political elements that have proved so unpopular with British voters, was first mooted as far back as 1999.

That year, with tension rising over the Britain’s membership of the EU over the controversial introduction of the euro, a report for the US Congress estimated the potential economic benefits to the UK at over $5bn a year.

Adjusted for inflation that figure would now be a £5bn boost, the same amount the Civitas think tank says UK firms would have to pay to export to the EU if no Brexit deal is agreed and relations revert to WTO rules.

And given the strong growth in British trade to the region over the past 17 years, especially with emerging economy Mexico, Mr Coker said such a number would be “absolutely conservative”.

Instead, the trade expert predicted swapping EU membership for NAFTA could be “accretive” and leave the UK better off in the long term because the US and Canada are much wealthier markets than Europe.

He said many British companies, especially those dealing in services, could easily switch their main point of business to the richer North American marketplace in the event that Britain joined the club.

Mr Coker, now a lecturer at Westminster Business School, said: “Absolutely its conservative and, furthermore, reflects both the US and UK economies some twenty years ago.

“Today, should a similar study be conducted, services would figure much larger.

“And it’s far easier to sharply redirect and increase export of services rather than physical exports of manufactured goods. This could happen very, very quickly.”

It is conceivable increased trade with the North American bloc would totally wipe out any additional costs of Brexit, and easily be accretive
Trade expert David Coker
He added: “While some firms will continue to trade with the EU even with the hit of WTO tariffs – assuming we can’t negotiate a lower set – other firms may choose to divert large parts, if not all their exports to NAFTA, choosing to forego the cost of adhering to EU rules in favour of new opportunities NAFTA would present.

“It is conceivable increased trade with the North American bloc would totally wipe out any additional costs of Brexit, and easily be accretive.”

Mr Coker, who grew up in Donald Trump’s hometown of New York, said many leading Republican politicians would be open to the idea of inducting the UK into NAFTA.

He pointed out that such a move would present a big political win for both the US President, who has taken a eurosceptic stance, and Mrs May as it would insulate her from European “threats”.

The trade expert said: “The psychological value of NAFTA as an option can’t be underestimated.

“Not only would this strengthen Mrs May’s negotiating position – simply walking away would be a viable response should thuggish threats emerge at the talks – the surge of confidence in both Mrs May’s Government as well as The UK’s future would be tangible.”

Top 10 countries that want to trade with UK after Brexit
Thu, February 16, 2017
These are the top 10 trade partner prospects for the UK moving forward

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1 of 11

10. Canada: Disruption in Canadian agricultural markets are a key sticking point in negotiations with the EU.
9. Singapore: Singapore’s nature as a relatively open service-based economy would mean the barriers to achieving a deal should be low.
8. Japan: Agreements over agricultural and automobile markets may stymie progress for a trade agreement.
7. India: The economic growth of India and the gains from trade mean the benefit would be high if an FTA could be agreed.
6. UAE: Major sticking points in EU negotiations have been over Saudi export tariffs, but the UK could be positioned to make concessions in this area.
5. Australia: Benefits may be limited as both tariff and non-tariff barriers are already low, meaning a lower marginal benefit.
And he concluded: “In spite of stringent EU rules, the US and UK already have a strong commercial relationship.

“Joining NAFTA while leaving the EU would give both President Trump and Theresa May clear policy wins.

“If EU restrictions were removed and NAFTA expanded, the true spirit of Anglo-American capitalism might significantly increase mutual benefits, making the ‘special relationship’ far more unique in global capitalism.”

The three NAFTA countries boast a combined population of 477 million people, with an average GDP per capita of £30,250. Without Britain, the EU will have a population of 440 million with an average GDP per capita of around £29,300.

Under EU treaty rules, Britain is not technically allowed to negotiate new trade deals with third countries until after it has left the bloc in Spring 2019.

However, both Mr Trump and UK trade secretary Liam Fox have expressed their determination to strike a new trading partnership between the old allies as quickly as possible.

Top financier David Coker told express.co.uk that Theresa May should ditch the Brussels single market and instead seek membership of the lucrative North America Free Trade Association (NAFTA).He said the increase in UK exports that would result from more trade with its three other members – the US, Canada and Mexico – could easily “wipe out” any deficit caused with Europe.Mr Coker, a former Vice President of Deutsche Bank and high ranking official at the global credit ratings agency Moody’s, made the remarks after a top Republican said Donald Trump was ready to seal a deal with the UK.

Theresa May and Donald TrumpGETTY            Theresa May should apply for membership of NAFTA, a trade expert has said


That year, with tension rising over the Britain’s membership of the EU over the controversial introduction of the euro, a report for the US Congress estimated the potential economic benefits to the UK at over $5bn a year.Adjusted for inflation that figure would now be a £5bn boost, the same amount the Civitas think tank says UK firms would have to pay to export to the EU if no Brexit deal is agreed and relations revert to WTO rules.

And given the strong growth in British trade to the region over the past 17 years, especially with emerging economy Mexico, Mr Coker said such a number would be “absolutely conservative”.Instead, the trade expert predicted swapping EU membership for NAFTA could be “accretive” and leave the UK better off in the long term because the US and Canada are much wealthier markets than Europe.He said many British companies, especially those dealing in services, could easily switch their main point of business to the richer North American marketplace in the event that Britain joined the club.Mr Coker, now a lecturer at Westminster Business School, said: “Absolutely its conservative and, furthermore, reflects both the US and UK economies some twenty years ago.“Today, should a similar study be conducted, services would figure much larger.

“And it’s far easier to sharply redirect and increase export of services rather than physical exports of manufactured goods. This could happen very, very quickly.”

It is conceivable increased trade with the North American bloc would totally wipe out any additional costs of Brexit, and easily be accretive

Trade expert David Coker

He added: “While some firms will continue to trade with the EU even with the hit of WTO tariffs – assuming we can’t negotiate a lower set – other firms may choose to divert large parts, if not all their exports to NAFTA, choosing to forego the cost of adhering to EU rules in favour of new opportunities NAFTA would present.“It is conceivable increased trade with the North American bloc would totally wipe out any additional costs of Brexit, and easily be accretive.”Mr Coker, who grew up in Donald Trump’s hometown of New York, said many leading Republican politicians would be open to the idea of inducting the UK into NAFTA.He pointed out that such a move would present a big political win for both the US President, who has taken a eurosceptic stance, and Mrs May as it would insulate her from European “threats”.The trade expert said: “The psychological value of NAFTA as an option can’t be underestimated.

“Not only would this strengthen Mrs May’s negotiating position – simply walking away would be a viable response should thuggish threats emerge at the talks – the surge of confidence in both Mrs May’s Government as well as The UK’s future would be tangible.”

And he concluded: “In spite of stringent EU rules, the US and UK already have a strong commercial relationship.

“Joining NAFTA while leaving the EU would give both President Trump and Theresa May clear policy wins.“If EU restrictions were removed and NAFTA expanded, the true spirit of Anglo-American capitalism might significantly increase mutual benefits, making the ‘special relationship’ far more unique in global capitalism.”The three NAFTA countries boast a combined population of 477 million people, with an average GDP per capita of £30,250. Without Britain, the EU will have a population of 440 million with an average GDP per capita of around £29,300.Under EU treaty rules, Britain is not technically allowed to negotiate new trade deals with third countries until after it has left the bloc in Spring 2019.However, both Mr Trump and UK trade secretary Liam Fox have expressed their determination to strike a new trading partnership between the old allies as quickly as possible.

http://www.express.co.uk/news/politics/794812/Brexit-news-trade-expert-UK-better-off-leaving-EU-joining-NAFTA

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