Brexit’s Broken Promises

The British flag flies over the Houses of Parliament in London, England
The British flag flies over the Houses of Parliament in London, England (Unsplash/Matt Milton)

The New Statesman reports that none of Brexit’s promises have come true:

  • Brexiteers said leaving the EU would unleash growth. Instead, growth has stalled and higher inflation has depressed real wages.
  • David Davis, now Brexit secretary, said Britain would be able to create “a free-trade area massively larger than the EU.” So far, no country has expressed an interest in doing a separate trade deal with the United Kingdom.
  • Liam Fox predicted that trade talks with the EU would be “one of the easiest in human history.” But the EU insists on properly negotiating Britain’s exit before even starting trade negotiations.
  • Rather than give Britain an extra £350 million to spend on health care each week, the Office for Budget Responsibility projects that the country will lose the equivalent of £300 million per week because of Brexit.

Little wonder that supporters of leaving the EU have continually lowered expectations. The promise of Brexit has been downgraded from a Singapore on the Thames to not “as apocalyptic as some people like to pretend”.

World Not Waiting for America: Pacific Nations Continue Trade Deal

Prime Ministers Shinzō Abe of Japan and Justin Trudeau of Canada speak in Washington DC, March 31, 2016
Prime Ministers Shinzō Abe of Japan and Justin Trudeau of Canada speak in Washington DC, March 31, 2016 (Flickr/Justin Trudeau)

In another sign that the world isn’t waiting for the United States, eleven countries in Asia and Latin America have announced their intention to keep the Trans Pacific Partnership (TPP) alive.

One of Donald Trump’s first acts as president was to withdraw from the trade pact.

Japan and Mexico stepped into America’s place to salvage it.

Both have also intensified their trade negotiations with the EU, which itself is rushing to defend globalization from a suddenly protectionist America. Read more

Trump’s Welcome Change of Heart on South Korea Trade Deal

Presidents Moon Jae-in of South Korea and Donald Trump of the United States meet on the sidelines of the United Nations General Assembly in New York, October 2
Presidents Moon Jae-in of South Korea and Donald Trump of the United States meet on the sidelines of the United Nations General Assembly in New York, October 2 (White House/Shealah Craighead)

American president Donald Trump appears to have changed his mind about a trade deal with South Korea.

As recently as a month ago, there were reports Trump was on the verge of withdrawing from the agreement.

Now American and Korean trade negotiators have agreed to amend the treaty in order to make it “fair” and “reciprocal”.

I doubt changes will really make the pact fairer and not more favorable to the United States. But that would still be better than canceling it. Read more

Canceling South Korean Trade Deal Would Be a Mistake

South Korean president Moon Jae-in attends a military ceremony in Quantico, Virginia, June 28
South Korean president Moon Jae-in attends a military ceremony in Quantico, Virginia, June 28 (USMC/Rachel Ghadiali)

Various American media report this weekend that President Donald Trump is thinking of canceling a trade agreement with South Korea.

This may be bluster: an attempt to force the South Koreans to make concessions. It’s the way Trump “negotiates”.

But if he makes good on this threat, it would be another self-inflicted wound for American commerce and a setback for America’s strategy in East Asia. Read more

Mixed Success for Trump at the G20 on Syria and Trade

German chancellor Angela Merkel gestures at American president Donald Trump during the G20 summit in Hamburg, July 8
German chancellor Angela Merkel gestures at American president Donald Trump during the G20 summit in Hamburg, July 8 (Bundesregierung)

The G20 summit in Hamburg, Germany has been a mixed success for American president Donald Trump.

On Syria:

  • On the one hand, Trump negotiated a ceasefire for southwestern Syria with his Russian counterpart, Vladimir Putin. American-backed rebels have been fighting the Russian-backed regime of Bashar Assad there.
  • On the other hand, he didn’t elicit Russia’s support for the war against the self-proclaimed Islamic State, which is Trump’s priority.

On trade:

  • On the one hand, G20 leaders conditioned open markets on “reciprocal and mutually advantageous trade” in their summit declaration and recognized the role of “legitimate trade defense instruments” — a political victory for Trump.
  • On the other hand, a threat from European Commission president Jean-Claude Juncker to retaliate with EU trade sanctions appears to have persuaded Trump not to raise tariffs on steel. Read more

Europe, Japan Send “Strong Signal” with Trade Deal

Japanese prime minister Shinzō Abe, European Council president Donald Tusk and European Commission president Jean-Claude Juncker pose for photos in Brussels, March 21, 2017
Japanese prime minister Shinzō Abe, European Council president Donald Tusk and European Commission president Jean-Claude Juncker pose for photos in Brussels, March 21, 2017 (European Commission)

European and Japanese leaders have announced a landmark trade agreement on the eve of the G20 summit in Hamburg, Germany, where America’s president, Donald Trump, is expected to press his case for protectionism.

The treaty has yet to be finalized. A summit in Brussels was hastily arranged to “send a strong signal,” as the EU’s trade commissioner, Cecilia Malmström, put it earlier this week.

“We believe we should not build walls or raise protectionism,” she said. Read more

In Era of Trump, Europeans Become Free Traders

French president Emmanuel Macron is greeted by German chancellor Angela Merkel in Berlin, May 15
French president Emmanuel Macron is greeted by German chancellor Angela Merkel in Berlin, May 15 (Bundesregierung)

European leaders are preparing for a showdown on trade when they meet Donald Trump at the G20 summit in Hamburg next month.

“Whoever believes that the world’s problems can be solved by isolationism and protectionism is mistaken,” Germany’s chancellor, Angela Merkel, told her parliament on Thursday.

French president Emmanuel Macron chimed in: “If free trade is questioned by a member state then we need to address this.” Read more