Impoverish A Neighbor

2021-01-27   |   by CusiGO

When a country becomes poorer than others, for example, because a crisis affects it more than others – this is called asymmetric shocks – it can try to restore bravery. Protect themselves by impoverishing others and rebalance their damaged trade relations.

Until the suicide attacks of the great depression in the 1930s. I don’t know. Reduce the cost of money by raising import prices (increasing import tariffs and / or reducing export taxes); or by competitive devaluation of the domestic currency: by lowering the exchange rate, you can benefit your sales and inhibit your purchases.

That’s the temptation to haunt Britain. The first almost complete month of brexit – a difficult but not confusing version due to future trade agreements – confirmed the prediction that it would not cause disaster or collapse of the UK economy. But it does have a lot of problems and slowing growth that exacerbated (and confused) the problems created by the great depression.

The chronicles of London are consistent. The number of trucks on the border has multiplied. Customs procedures are complicated by endless paperwork. Perishable products are dying while waiting for red tape. Some of the so-called main beneficiaries, such as fishermen, are applying.

All indications are that, for islanders alone, the administrative cost of Britain’s withdrawal from the EU will be close to 8 billion euros a year, accounting for two-thirds of its top net contribution to the EU budget. In contrast, the bill is a sunk cost; its contribution is an investment in the political management of the future direction of the EU.

In fact, the kingdom is not divorced from the common market, a region without internal tariffs. And the customs union, a region that imposes common external tariffs on third countries. In addition, since the single act of 1986, the internal non-tariff barriers (standards, administrative control) have been abolished, and a borderless Europe has been established.

As a result, the bill began to hurt their infidels, whether they were caught off guard or not. Some observers, such as master Robert tornabell, worried that a round of “hard brexit” might “include devaluing the pound against the euro” (January 22 expansion).

Others reiterated that they were worried that there would be positive or unfair tax competition in the future, which was the shadow of the threat of “Singapore on the Thames”. Some experts from the London School questioned this because “it is difficult to reduce regulation in an area heavily dependent on trade with the EU” (the impact of brexit) Economics, London School of economics, 4 February 2020). Anyway, the story is not over. be careful.