Monday, 6 June 2016

Britain's civil service lacks the "know-how" to negotiate its own trade deals if there's a BREXIT!

We are publishing below extracts from the'Monday Briefing' from Ian Stewart, Chief Economist for Deloittes:

Brexit and European politics

* The "What the UK Thinks: EU Poll of Polls", based on the average share of the vote for 'Leave' and 'Remain' in the six most recent polls carried out between 20th May and 3rd June shows Remain and Leave once again tied on 50% (adjusting for the removal of "don't knows")
* According to the latest political betting odds cited by PaddyPower, there is currently a 31% implied probability of a Brexit vote – up sharply from last week's 22%, and indicating the probability of a Brexit has risen in the last week
* Sterling fell sharply on against the dollar following the release of an ICM telephone poll that gave a 3-point lead to the Leave campaign – even though phone polls have previously given consistent and often sizable leads to Remain
* The FT reports that investment banks and hedge funds have exploited Electoral Commission rules that permit private 'exit polls' on the day of the EU referendum, to pay for their own polling in an attempt to make profits from the result of the vote before it's announced
* Miriam González Durántez, a former international trade negotiator, used an article in the FT to warn that Britain's civil service lacks the "know-how" and capacity to negotiate its own trade deals with the rest of the world "any time soon"
* The leaders of Germany, the Netherlands, Ireland and Spain all made separate interventions to urge British voters to stay in the EU – including some unusually blunt warnings that a Brexit vote would hurt travel rights, economic prospects and international influence
* The Royal United Services Institute (Rusi), a prominent defence think-tank, warned that Brexit would represent the largest security and defence shock for the UK since the end of the British Empire and the withdrawal from Suez
* Britain's departure from the EU threatens the stability of the rest of Europe, according to Sir Tim Clark, president of Emirates Airline, who warned that "Geopolitical, socio-economic problems – all these things will suddenly get traction"
* Jamie Dimon, the chief executive of JP Morgan, warned that Brexit would represent "a terrible deal for the British economy", adding that his bank "may have no choice but to reorganize our business model here" in the event of a Leave vote
* Ratings agency Moody's warned that Brexit could lead to a fall in UK house prices, as "a drop in the foreign population would have a cascading effect by lowering housing demand, which in turn would drive down the cost of rent and increase vacant periods"
* The OECD cut its forecasts for growth in the UK economy and warned that Brexit poses as big a threat to the global economy as a "hard landing" in China
* The founder of pub chain JD Wetherspoons printed 200,000 beer mats in a direct message calling for customers to vote to leave the EU, taking particular aim at Christine Lagarde and the IMF
* In a letter to the FT fifty-one chairmen and chief executives of Europe's leading multinational companies warned that a Brexit vote could lead to an "unravelling" of the EU's single market and reduce prosperity in the UK and Europe

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