Hello its David here.
‘What is a Trade Remedy?’, I hear you cry.
Put simply, blatant protectionism. The sort of thing of which Republican Donald Trump is constantly accused – despite his current stance simply mirroring and extending his predecessors’ approach, viz The Byrd Amendment of 2005, sponsored by a Democrat politician.
These remedies take the form of extra taxes on imported goods, known as Anti-Dumping Duty and Countervailing Duty. These taxes are over and above the usual import taxes and can be of extraordinarily high, as was the case until recently with solar panels from the Far East. Some measures target individual countries of origin, others blanket all origins.
It may be surprising to learn that despite the bluster about Free Trade, the EU currently has some 107 such measures in place. The Department for International Trade [DIT] has completed surveys and research to establish how the UK should approach this subject post-Brexit. Since these additional duties are intended to protect EU producers from ‘unfair’ competition, not all current EU measures are in the national interest of any given member state. This is because not every EU member state is engaged in the sectors of the affected products.
The UK, through the auspices of the DIT, has adopted a pragmatic approach. Any trade remedy which does not benefit a UK interest will be dropped in a post Brexit world. This means that where the UK does have a direct interest, the trade remedy will be retained under new UK laws. Where there is no interest, the additional taxes will be scrapped, having the effect of lowering the costs of many imported products which the UK cannot source within its own borders.
By way of example, protections will be maintained for the bio-diesel, steel and iron industries, but there will be the potential for cheaper solar glass, bicycles, sweetcorn, aluminium foil, citrus fruits and coated paper – a total of 63 products which should become cheaper. The full list can be found at: gov.uk/government/consultations/call-for-evidence-to-identify-uk-interest-in-existing-eu-trade-remedy-measures
It is ironic that the larger the EU becomes and the more it flouts ‘Free Trade’, the more industries it must seek to artificially protect from more cost effective global competition. If the EU becomes large enough, it is in danger of disappearing inside its own protectionist agenda.