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If Global Britain really came off, we would be like… Germany
04 Dec, 2017

German exports are two thirds higher than the UK’s. The problem is not EU membership.

 

 

World Bank figures show that UK exports of goods and services in 2016 were the equivalent of 28% of GDP, just a little less than France (29%) and Italy (30%), rather lower than Spain (33%).

Freed from what Leavers see as the constraints of being in the EU, perhaps UK exports would increase by half, say to 42%. Still not as high as Germany (46%) or Poland (52%).

But with added Turbo-Brexit, perhaps our exports would double, to 56%. We would then overtake Austria (52%). But still not as high as Bulgaria (64%).

Surely with Global Britain Super Brexit they might triple to 84%. We would then have caught up with Belgium (84%), but still be behind Hungary (93%) and Ireland (120%).

A sensible comparison

These figures are of course a bit of a tease. As a general statement exports as a % of GDP are low for large countries (USA 13%, Japan 18%) and high for small countries – if they do not sell to foreigners, to whom can they sell?

So one should only make comparisons with countries of similar size and standing. Then, the serious comparison is with Germany. If even though their economy is markedly bigger than ours they can manage to be “Global Germany” with exports two thirds higher as a %age of GDP than the UK then we cannot blame EU membership for holding us back.

So the problem is that we are not making stuff that foreigners wish to buy. Brexit is not a solution to that problem.

Indeed, Brexit will make it worse. What we are good at producing is services. The Single Market applies to many services. Free Trade Agreements do not.

 

By Michael Romberg, a former senior civil servant in HM Treasury and a member of the Committee of London4Europe