Sunday, 30 October 2016

You can, if you're Nissan

A few weeks ago, Nissan grande fromage, Carlos Ghosn, arrived at Downing Street for talks with the PM.

And then last week, Nissan announced that it was to build two new models in Sunderland after all. After receiving assurances from the British Government.

The Government was over the moon, Harry, with the deal, and stressed that this was not a bail out nor was there any special favours promised. But as soon as those words were spoken, news wire Reuters were reporting something different. Britain promising to make the difference in tariffs, or as reported elsewhere, promising to stay in a tariff free zone.

Whatever the truth of the deal, is that other car makers; Honda, BMW and other foreign-own manufacturing began to express their desire that similar deals would be applied either to them, or their sectors.

Rebates, deals, assurances, subsidies or whatever was called, goes against the idea that Britain would be able to set up free trade deals once it was out of the EU, or that it would free up money to be spent elsewhere. Seems that any money that could be saved will either be spent compensating corporations or paying more for the same access to free trade zones than we currently already do.

Big business would also be able to threaten Britain to move out unless certain terms were offered, or corporation tax reduced. Or else.

And then there are the broader implications: Ford, or BMW or HOnda that did not get the deals they wanted here, might consider moving elsewhere in the EU, meaning jobs and investment would be kept here (depending on any access to the EU market, of course). Would those self-same countries then be inclined to sign up to a free trade deal with Britain? Even worse, such a deal which offered some kind of state aid to a manufacturer could also be against WTO rules, meaning that if we failed to get a deal with the EU, then falling back on WTO rules could be threatened if we were to have violated their rules too.

So, on the face of it, what seemed like a good deal and great news for the Brexiteers and the PM could me: lower taxes from Nissan and pother car makers, retaliation from the EU and/or the WTO, and many more such companies demanding more of the same for them. Instead of having more money to "spend" on the NHS, we would have less tax and pay for companies to actually have a presence here. Making the Government and the rest of us much worse off, our already stretched services break.

Taking back control, right there.

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