Am Gymraeg, cliciwch yma.
WHAT IS THE CUSTOMS UNION?
The main features of a Customs Union are:
- Free trade in manufactured goods
- Common external tariff on imports from the rest of the world (this means that individual countries can’t do their own trade deals, only as part of the whole union)
WHERE DOES WALES FIT IN?
Wales’ manufacturing, agricultural and fishing industries benefit from us being a member of the Customs Union. Not least with the benefits of selling our products to the rest of the EU, it gives us access to tariff free trade with 56 other countries that the EU has agreements with (most recently, Canada).
Machinery and transport equipment (cars & aeroplanes) are what we export most of. In 2015/16, this counted for £4.7 billion (40% of everything we export).
WON’T BREXIT MAKE IT EASIER TO SECURE OUR OWN DEALS?
Many Brexit politicians claimed that outside the EU’s Customs Union, the UK would be able to secure fantastic free trade deals with whomever we want.
This is incredibly and dangerously simplistic.
Yes, being outside the Customs Union will enable the UK to strike its own free trade deals, but in a world where the US, Russia, China, Brazil and India are becoming the new superpowers looking for their own favourable terms, how succesful will the UK be compared to the clout we have as part of the 500 million strong European Union?
If the UK would be able to strike fantastic free trade deals that protect and strengthen Wales’ manufacturing, agricultural and fishing industries, then leaving the Customs Union is acceptable.
However, there is no evidence that this is the case.
In fact, Britain’s brexit lifeline up until recently was Donald Trump, who has now admitted that a deal with the EU takes precedence over a deal with the UK.
BUT THE COMMONWEALTH WANTS TO TRADE WITH US?
Yes, the commonwealth is an excellent source for trade with the UK. However, it does not operate as one Customs Union, as the EU does, so each trade deal will have to be completed separately (each of which takes years to complete).
Recently, New Zealand has indicated its keeness to establish a trade deal with the UK. While obviously, close economic ties are welcome, but in a post-hard-brexit Britain, desperate for a deal, how will one made with New Zealand affect Wales? New Zealand’s second biggest export is lamb (USD $2.24bn). This will have serious implications for Welsh hill farming when combined with loss of EU subsidies and beneficial access to the Single Market.
Moreover, the proximity of Europe means that by simple geography, we are more likely to trade with our neighbours.
Is Brexit, worth it?
No it isn’t.