EU, the wrong club – 2nd May 2016
Last week economics has finally, if briefly, broke cover in the referendum debate. We joined a club which promotes trade within the club, and disadvantages trade outside it. Given that the greater part of our trade is outside, for us it was just the wrong club. Additionally, the principal trade within the club is manufactures and food where we have never enjoyed a comparative advantage: Our strength has instead always been in services. Even at the height of our industrial world power we ran a balance of trade deficit, which we made up for with an export surplus of services (principally shipping in those days). Un
Unfortunately, there is no ‘single market’ for services in this EU club. It is for this reason that the club exports so much more to us. It was in recognition of the fact that membership didn’t work for us that Mrs Thatcher negotiated a rebate. It’s time to recognise reality: Economically the club doesn’t suit us.