Brexit

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With all opposition parties and up to 80 Conservative MPs pledged to oppose May's deal when it comes to the House of Commons, Remainer ministers in her Cabinet are pushing for the prime minister to seek an alternative deal that would leave Britain with a closer relationship with the EU after Brexit. Five ministers, led by the Chancellor Philip Hammond are reportedly pushing for May to adopt a permanent customs partnership with the EU that could potentially draw the support of Labour MPs as well as the Democratic Unionist Party that has propped up her minority government. Meanwhile the Democratic Unionist Party, which props up her minority government, threatened to withdraw their support for the Conservatives if the deal is agreed by the UK parliament. Asked on Sunday if there were any circumstances in which her party would back May's deal in parliament, Foster told the BBC: "no there aren't."

Theresa May to sign Brexit deal with EU leaders as her Cabinet plots to rip up her agreement - Business Insider

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The UK will be poorer economically under any form of Brexit, compared with staying in the EU, government analysis suggests. Official figures say the UK economy could be up to 3.9% smaller after 15 years under Theresa May's Brexit plan, compared with staying in the EU. But a no-deal Brexit could deliver a 9.3% hit, the new estimates say.

Brexit will make UK worse off, government forecasts warn - BBC News

Some basic facts: 44 per cent of UK trade is with the EU. A total of 60 per cent of all UK trade is with the EU or with countries that have trade agreements with the EU. The service sector, which is 80 per cent of the UK economy, has received scant attention during the Brexit process. Financial services alone contribute 11 per cent of total tax receipts. It is clear that frictionless trade with the EU will require the UK to comply with EU regulation either in fact or through so-called equivalence. We will be rule-takers with no rights over what is in those rules and no ability to define equivalence. As regards trading with non-EU countries covered by EU trade agreements, it will take many years to negotiate replacements. The new post-Brexit UK immigration policy is certain to cause staff shortages in industries such as agriculture, care for the elderly, hospitality, transport, and most public services including the National Health Service. This is because we have, in the UK, the high class problem of more or less full employment. The consequences are troubling. Trade is likely to be significantly affected. Direct investment into the UK will reduce substantially, which we are seeing even now. The UK’s position as the global financial services hub will be fractured — and we are already seeing this happening. Negotiating trade agreements as the UK solo will be difficult — we are a relatively small economy — and as events have shown, we have failed to make any progress on trade agreements since the referendum.

Let’s step back and consider the consequences | Financial Times

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It is difficult to see how ports could continue functioning as before even if the government’s no-deal plans swing seamlessly into place in March. Authorities in France have said even a two-minute delay in Calais would lead to 16-mile queues in both countries. The Road Haulage Association (RHA) recently said the government was “in denial” over no-deal preparations. As it stands, hauliers entering the country will be required to submit a 40-section declaration form per consignment. “The form takes 10 minutes to fill out. If you take a large retailer who has 8,000 consignments [in one lorry], that would take 170 people eight hours to process one trailer,” said Richard Burnett, the RHA’s chief executive.

Food prices to finance: what a no-deal Brexit could mean for Britain | Politics | The Guardian

Sensitive souls might want to skip the whole article, a sectoral approach to the effects of a no-deal Brexit. The effects are large..

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Brexit hypcrites

Recall the gap between Jacob Rees-Mogg’s position as leader of the European Research Group and his stance as co-founder of, part-time worker for and 15% stakeholder in Somerset Capital Management – which has warned its investors of the dangers of a hard Brexit and which has now set up not one but two funds in Dublin. Recall too the advice from fellow arch-Brexiteer John Redwood, who has a sideline as chief global strategist for the Charles Stanley investment bank, suggesting a year after the Brexit referendum that those with money pull it out of Britainand “look further afield.”

Whether it’s Nigel Farage taking care to ensure two of his children can live, work and travel freely across the EU by having German passports, or Nigel Lawson, who lives in France, taking the precaution of applying for French residency, the pattern is familiar. It suggests a Brexiteer elite who believe that the pain of Brexit is for the little people. They are rich or powerful or connected enough to be insulated from the damage it will cause, making them free to sound off about its supposed benefits in the abstract – sovereignty! control! – while everyone else deals with the grim reality. So Dyson and his base will be safe in Singapore, leaving Britain to deal with the consequences of the disastrous decision he demanded.

Wealthy Brexiteers like James Dyson are jumping ship. Why might that be? | Jonathan Freedland | Opinion | The Guardian

More than 250 companies are in touch with the Dutch government about moving to the Netherlands because of Brexit, officials have said. The trade and investment arm of the country’s government has been soliciting moves from companies worried about access to the EU market, with Britain set to leave the single market and customs union. A number of high-profile companies have already announced a decision to cross the North Sea, most recently Japanese electronics giant Sony specifically citing Brexit. Last year Panasonic also announced it was moving to Amsterdam. Michiel Bakhuizen, a spokesman for the Netherlands Foreign Investment Agency (NFIA), told the AFP news agency that the number of firms in talks was growing.

Brexit: Dutch government says over 250 companies in talks about relocating to Netherlands | The Independent

And that's just the Netherlands..

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Here's a roundup of the financial exodus so far:

• US bank giants Goldman Sachs, JPMorgan, Morgan Stanley, and Citigroup have moved 250 billion euros ($283 billion) of balance-sheet assets to Frankfurt because of Brexit.
• Bank of America is spending $400 million to move staff and operations in anticipation of Brexit, and istrying to persuade London staff to move to Paris.
• Barclays last week won permission to shift assets worth £166 billion ($216 billion) to its Irish division. Barclays is set to become Ireland's biggest bank.
• France's BNP Paribas, Credit Agricole, and Societe Generale have opted to transfer 500 staff out of London to Paris.
• UBS has chosen German financial center Frankfurt for its new EU headquarters.
• Swiss peer Credit Suisse is moving 250 jobs to Germany, Madrid, and Luxembourg among other EU 27 countries as well as $200 million from its market division to Germany. And in December Credit Suisse told its wealthiest clients to hurry and move their money out of the UK before Brexit.
• Germany's Deutsche Bank is also considering shifting large volumes of assets to Frankfurt as part of its Brexit plan.
• HSBC, Europe's biggest bank, has shifted ownership of many of its European subsidiaries from its London-based entity to its French unit.
• Australia's largest bank by assets, Commonwealth Bank of Australia, has set in motion plans to base around 50 staff in Amsterdam, and has applied for a banking licence in the country.
• Other Australian lenders Macquarie, Westpac, and ANZ are also in talks to move operations to Dublin and continental Europe.
• Europe's biggest repo trading venue, called BrokerTec, is being moved to Amsterdam from London, meaning a $240 billion a day repo business is leaving the UK.
• More than 100 UK-based asset managers and funds have applied to the Irish central bank for authorization in Ireland.

The impact of these changes will see less tax revenue for the government, fewer jobs, and a dent in dealmaking, taking a shine off the City's luster. And that's just financial services. A British parliamentary report also recently announced that the UK had lost out on €5 billion ($5.7 billion) in infrastructure funding in the past year. Schaeffler, a car parts company, is closing two UK factories because of Brexit, leading to 570 fewer jobs. The latest wound: Nissan this week cancelled plans to build its new sport utility vehicles at its northern English Sunderland plant. The original decision would have created 740 new jobs.

Brexit: UK hasn't left the EU yet but damage has already been done - Business Insider

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The Dutch government has said it is in talks with more than 250 companies about moving their operations from the UK to the Netherlands before Brexit. The economic affairs ministry said it had lured 42 companies or branch offices and 1,923 jobs from the UK last year, as it increases its efforts to gain Brexit business. Among those who have chosen to invest in the Netherlands are the Discovery Channel, Sony and Bloomberg.

Brexit: Netherlands talking to 250 firms about leaving UK | Politics | The Guardian

Ford has predicted that a no-deal Brexit will result in costs of $800m (£612m) during 2019 alone, in the latest in a series of stark warnings over potential disruption to British manufacturing. If the UK leaves the EU on 29 March without a deal the US carmaker said it could face trade delays at the border, a weaker economic outlook and tariffs on trade between the UK and EU, as well as a hit from the likely sharp fall in sterling.

Ford says no-deal Brexit would mean costs of $800m in 2019 alone | Business | The Guardian

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Despite being voted down by a record margin, Theresa May's Brexit deal will pass..

They added: "I say to them 'look you're playing a really dangerous game here that may end up in no Brexit at all' and while some of them still aren't listening to that argument, lots of them are now starting to." Conversely, the greater the chances of a softer Brexit become, the more likely Conservative MPs believe that May's original deal will pass. The Labour Party has offered to back May if she pivots to a softer exit from the EU. "I'm saying to them [in the ERG] look if you don't back this deal then the prime minister will be forced to reach across the aisle and do a deal with the opposition which you will like far less.

Why Conservative MPs now believe Theresa May's Brexit deal will pass - Business Insider

There are simply no alternatives for the Brexiteers that are better, although many of them would like no deal at all (or at least they don't have a problem with that), there is a majority against that.

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Last June, the scandal merchant Isabel Oakeshott was exposed for withholding a cache of emails detailing Leave.EU co-founder Arron Banks’ multiple meetings with Russian officials, which might have been of interest to the Electoral Commission’s investigation into the financing of the Brexit campaign. During the following days she was invited on to Question Time and other outlets, platforms she used to extol the virtues of Brexit. By contrast, the journalist who exposed her, Carole Cadwalladr, has been largely frozen out by the BBC.

This is not the first time Oakeshott appears to have been rewarded for questionable behaviour. Following the outrage caused by her unevidenced (and almost certainly untrue) story that David Cameron put his penis in a dead pig’s mouth, Paul Dacre, the then editor of the Daily Mail, promoted her to political editor-at-large.

How the media let malicious idiots take over | George Monbiot | Opinion | The Guardian

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Countries are likely to offer the United Kingdom worse trade deals than it currently enjoys as an EU member, the former head of Liam Fox's International Trade Department has told Business Insider. "The United Kingdom alone can offer significantly less in terms of market access or government procurement than can all of the European Union," Donnelly said. Major trading partners of the UK including Japan and the USA have indicated that they will seek tough concessions from the UK in trade talks because it is a relatively small trading partner. "Trade negotiators are not sentimental," Donnelly said.

Brexit trade deals will be worse than EU deals, says ex-UK trade chief - Business Insider

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British Steel is on the brink of collapse unless it can secure £30m in emergency funding from the government, putting about 5,000 jobs directly at risk and endangering thousands more in the supply chain. Andrew Stephenson, a junior minister at the Department for Business, Energy and Industrial Strategy (BEIS), refused to give details in parliament on Tuesday of ongoing talks between the government and British Steel. However, he ruled out nationalisation of the company.

The company has blamed Brexit for the squeeze on its finances. Union representatives said British Steel had lost 25% of orders at its Scunthorpe plant because of Brexit uncertainty, according to the Conservative MP Caroline Spelman. EU buyers would have to pay tariffs on British Steel’s products if the UK left without a deal.

 British Steel on brink of administration, putting 5,000 jobs at risk | Business | The Guardian

Britain’s manufacturing sector has suffered the worst slump in orders for more than two and a half years as the car and textile industries struggled against Brexit headwinds. The CBI said its industrial trends monitor for May showed that without an agreement with the European Union, the manufacturing sector was gripped by “economic paralysis” and moving “ever closer to disaster”. Amid concerns that British Steel faces bankruptcy with the loss of 4,500 jobs and a further 20,000 among suppliers, the CBI said continued stockpiling was not enough to offset the slowdown in manufacturing as a result of parliament’s failure to agree a Brexit deal. Order books were below normal at 32% of manufacturers compared with 23% of firms where order books were above normal to give a rounded balance of -10%. The CBI said May’s survey revealed the lowest order balance since October 2016, while export orders worsened to a balance not seen since immediately after the referendum vote in July 2016.

 UK manufacturing hit by its worst slump in two and a half years | Business | The Guardian