Brexit Opportunities Abound – Part 1

Croatian and British passports, which would you prefer? – (CC BY 3.0)

As you may have noticed Jacob Rees Mogg Esquire – as no doubt he would style himself – has invited the public to submit suggestions on the theme of ‘Opportunities of Brexit’. I could not resist replying. Could I possibly suggest that you, after reading this, do the same?

Dear Mr Rees Mogg,

Congratulations on your appointment as Minister for Brexit Opportunities and Government Efficiency (BOGEY). Thank you very much for asking me to name some of the many opportunities posed by Brexit. I’m surprised that you are still looking for these, six years after the referendum, during which time you have spoken of little else. However, if you still need informing, I shall take certainly take you up on your very kind offer.

Brexit presents so many opportunities that I do not really know where to begin. I will have time to mention only a few of them.

I will gloss over the alleged new found rights to put a crown stamp on pint glasses, or to eat fish and chips out of newspapers. Even if these were not spurious, I can hardly believe that these have changed your life for the better, any more than they have mine.

I will equally gloss over the right to establish freeports. This was entirely possible while in the EU, indeed many EU member states have them. They were abolished by the Conservative government of David Cameron because they appeared to bring no benefits to the UK economy. They do however create openings for money laundering, so without doubt they can be included on our list of Brexit Opportunities

What Colour Passport?!!

I will, however, mention the ‘iconic’ blue (well, black, but who cares?) passports, something of which the UK government have felt it necessary to boast. This would of course always have been possible, after all the Croats have had similarly coloured passports throughout their membership of the EU. But there is a very genuine change in UK passports. Until the end of transition, your British passport was just as valuable as my Irish one. It allowed you to live and work without let or hindrance in 32 countries. That number has now dwindled to two, the UK and Ireland. No wonder so many British citizens have been applying for passports from other EU countries, including I note the PM’s father. Your government has continued to boast about the loss of free movement, as if that were in some way a win. It has above all hit citizens of your own country. And for many, particularly those whose work took them into the EU, it has meant the loss of their livelihood.

Leaving this aside, the new UK passports have certainly provided new opportunities. Just ask the employees of the Franco-Dutch firm, Gemalto, who now manufacture them in a factory in Poland. This has of course been at the expense of workers in the De La Rue factory in Gateshead, who made the old burgundy passports.

So let us move on to other genuine opportunities, and there are many….

A grateful Amsterdam

Opportunities in EU financial centres: the city of Amsterdam is no doubt extremely grateful to you and your colleagues. On the first Monday in January 2021, £1.3 trillion (yes, £1,300,000,000,000) worth of euro denominated business was taken away from the City of London and relocated to Amsterdam. But as we now know, this was just the start. The financial centres of Paris, Frankfurt and Dublin are profiting from business previously located in London. So, ironically, is New York. So far the EU has declined to grant long term equivalence to the City of London in the majority of areas of finance, and it will do so only where it is in its own interest. In other words, the UK, at one time the EU’s most powerful financial centre and indeed the base for the European Banking Authority, is now at the mercy of decisions made in Brussels – as in so many other respects. The more it departs from the much criticised EU rules and regulations – which Lord Frost tells us is a ‘National necessity’ – the less it will be able to compete in the European marketplace. Like all other service industries the financial sector was tragically neglected in negotiations on the Trade and Co-Operation Agreement.

Lord Frost and his friends devoted all their energies to the fishing industry, which is of the order of 1% of the size of the financial sector. And incidentally I need hardly remind you how that worked out. Just ask the fisherman of Hull, where the country’s largest trawler, the Kirkella, previously responsible for 10% of cod and haddock eaten in the country, is now standing idle as a result of loss of EU markets, and is likely to be sold abroad. So yes, another massive opportunity – for the fishing industries of Norway and the EU, and for whoever buys that trawler at a knock-down price.

The Kirkella (Wikimedia Commons)

Countless British companies have had to establish trading hubs to Ireland and other European countries because the non tariff barriers to exporting between the UK and EU are so substantial. Some have had to relocate entirely – and indeed been advised to do so by HM Government. This has meant phenomenal opportunities to people employed in EU countries and to those who supply them. Not of course that the benefits of offshoring accrue to any more than a very tiny minority of UK residents. But I certainly do not need to remind you, as co-founder of Somerset Capital Management, with its new operations base in Dublin, about this. I’m quite certain that it is an art in which you could give me lessons.

The various shipping lines travelling between Ireland and France are grateful to you. There has been a 3-fold expansion on those routes, at the expense of the landbridge across England and Wales. In the process Holyhead and the Pembrokeshire ports have lost something like a third of their business, but since we’re talking here about opportunities I probably should not even mention such collateral damage, after all you and your colleagues have never done so.

There’s been an increase in opportunities for anybody holding an EU passport. Just one example: British film companies are now preferentially employing dual nationals as opposed to British nationals, because there are far fewer difficulties posed for them in working on shoots in continental Europe.

Crime pays

There are massive new opportunities for the criminal fraternity. With the departure from Europol and the loss by the British police of real time access to European criminal databases, cross border crime has become a great deal easier. And of course we have been told that there is a shortfall of 50,000 customs officers to enforce the import controls which became mandatory on 1st of January. The government is very cagey about telling us how many of these vacancies have been filled, but clearly success has been limited so far, indeed there is an air of desperation. What better opportunity could you imagine for dishonest people who are not averse to a little gentle bribery?

Opportunities for people smugglers (Sandor Csudai) 

There are new opportunities too for people smugglers: they can confidently assure their passengers that, once they have managed to make the perilous crossing over the channel, there is little or no likelihood of them being seen sent back to France. While previously the EU’s Dublin III regulations provided for repatriation to the first safe country, this is no longer the case, France and other EU countries have the right to refuse to accept migrants back, and the numbers repatriated have dropped from several hundred per year to a tiny handful. You may express surprise at the increase in asylum seekers crossing the channel, but this is quite simply a direct consequence of Brexit. While I personally believe that we owe a duty of care to the many people who arrive in this country in a state of distress, I’m not sure this was something which was explained to the people who voted for Brexit.

Inward migration from outside the EU has provided huge opportunities. While overall net migration has remained stable, that from the EU has declined by over 100,000, and there has been a concomitant increase from outside it. You can be quite certain that in trade negotiations Mr Modi and others will wish to ensure that it is residents of their countries which fill the massive staffing gaps created by Brexit. And good luck to them, but again not something which was explained before the referendum.

More to follow – Click here to read

If you want to tell Jacob Rees-Mogg what you think, try:
Jacob Rees-Mogg, House of Commons, London SW1A 0AAEMAIL: jacob.reesmogg.mp@parliament.uk (yes, he does have an email address!)

Ed: This article is based on an original post in Oxford for Europe.


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