UKH

Many of you will have head of Lord Digby Jones, a veritable champion of British industry according to Wikipedia https://en.wikipedia.org/wiki/Digby_Jones,_Baron_Jones_of_Birmingham

He's recently moved to Guernsey (almost certainly for tax reasons, he has no local connections) and has a column in the local paper once a month or so. An exerpt from his latest one https://guernseypress.com/news/voices/lord-digby/2021/01/20/reasons-to-be-f... :-

"Since you last gave me the privilege of reading these few jottings, the deal has been done, in the ‘down-at-the-wire’, last-minute fashion that was entirely predictable, sorted out between the only two actors who only ever really mattered when all the chauvinistic froth and arrogance was put back in its box, Germany and the UK.

Now it has to be made to work: more forms, more delay at borders and more vulnerability to capriciousness, but also opportunity with a capital O. Every business in the wider Europe now knows where it stands: there is certainty and a basis on which to plan, in which to invest, for the first time in four-and-a-half long, uncertain, confusing years. And huge opportunity for the UK in global markets, the likes of which have not been available for nearly half a century.

Globalisation was made for Britain in so many ways (not least its lack of protectionist tendencies, its historical and wider family ties, its production of value-added goods and services) and, as the world pivots east in Asia’s century and the UK shakes off the shackles of an EU marching valiantly towards the 1970s, she has never had such an opportunity to become the low-tax, lightly-regulated, global trader and home for inward investment that Paris, Berlin, Brussels et al always feared it would become."

Now am I right in thinking that he's very FTSE-focussed here, and that the British companies that do much of their work overseas (miners) or provide a high value service (finance etc.) are going to be the ones to benefit from Brexit to the detriment of everyone else?  No-one would invest in companies selling into Europe when it's become so much more difficult. Opportunities haven't really suddenly been created either - Germany have managed to become export champions of the world under EU rule, so the EU can't be the reason for the UK's worse manufacturing industry. Is the EU marching towards the '70s? if it is, then the UK is marching towards Victorian times with a wealthy minority fuelled by a majority in poverty.

It doesn't sound good, does it?

Digby Jones is a fat cat playing to an audience.  The Tories have the money and you get the money from the Tories by singing from their hymn book.   He's also a rich c*nt and has a vested in a 'low regulation' environment that lets him get away with sh*t the EU wouldn't.

The EU is not going to let the UK become a low regulation economy exporting stuff into the EU.  The UK is outside the EU single market and customs zone.

Effectively the great 'asia strategy' is to join the TPTP and pretend the UK is in the pacific.  I guess we get cheap stuff shipped from the pacific, work on it here with low cost labour and then, because it won't be allowed in the EU without paying tariffs, ship it back to the pacific.   Brilliant.

What lockdown under a Tory government has taught me is that as UK citizens we are not valuable unless we make money. Schools need to go back not to educate children but to free up patents to work (see also nurseries remaining open). We don’t make much effort to protect those in care homes because they’re costly. If you are a highly wealth individual you are free to travel (and, with many examples, lockdown rules don’t apply). Low income? You might as well spread the virus to your low income colleagues as it’s not worth us helping you through the financial penalty of self isolation (see also herd immunity). State school education? No need as private schools remain open and that’s what runs politics/business/media.

And breathe.

you know, I affectionately laughed at my dear grandmother's dire warnings about the Tories ("They'll have the shirts off your backs") in the early 1970s when being a Tory meant liking Ted Heath taking us into Europe.  Being young and knowing better I was disregarding her lifetime of experience, bringing up a family during the depression in Durham on a family income of 30 shillings a week, no NHS etc etc.

Now I know how wrong I was, though I still stand pike ready to defend Ted Heath as someone whose honesty is completely alien to the mobsters ru(i)nning the country now. (funny what one i can do in the wrong place, just like a bad PM)

He is a difficult character, but he does go round banging the drum in support of a lot of SME type manuifacturing business. I would say he is not particularly FTSE biased.he enjoys spending time in West Midlands with hard core manufacturing companys... spring makers and that type of thing.

Personnally I think he is a bit out of tune with things like regulations and shipping requirements and the effect that this will have. But he is 100% spot on in that growth will not be in Europe and will be focused on the Pacific Rim countries.In that respect joining the Trade Pacific Partnership is sensible.

I also think you are out of tune with UK manufacturing industry. For example JLR has been kept going over the last year or so by the strong economy in China( and done well out of it). Without that it would have been screwed.

I do not consider him a rich and succesful business man by the way.I suspect there are quite a few posters on UKC who have done considerably better than him in that regard. But he is good at blowing his own trumpet.

A friend of mine briefly worked in his practice and is less complimentary about him.

I first heard that pithy statement following a similar quote about Branson followed by some scary anecdotes... repeating the serious ones here might get me sued but on the mean but trivial side he apparently often didn't carry cash and just expected whoever was with him to pay if he needed anything.

I never understand comments like this, I am sure we all have a couple of friends who never carry cash and its like trying to get blood out of a stone when paying for things( and becomes a standing joke). Thats just life with some people irrespective of how wealthy or hard up they are.

Would not surprise me at all.

Of course, but is not being in the EU going to make dealing with Asia easier? Is the potentially improved Asian market going to offset the problems with the EU market? It's only a matter of time before the Asian general manufacturers stand on their own feet like the Asian electronics ones have, at which point that market evaporates for non-Asian businesses because they have a lower costbase.

I must say I agree with him and what he’s saying is the whole economic argument for brexit.

The EU is inherently protectionist and increasingly sclerotic. Free trade is the way forward. 

Brexit is a gamble that aligning ourselves with the rest of the world will lead to greater benefit over a 30+ year period.

I’m not certain that that the gamble will pay off (although I suspect it will), but it does make me chuckle when remainers point to delays at Dover in month 1 of year 1 as evidence that Brexit will harm the economy.

 The general rule is that UK manufacturing is for the most part niche with low volumes which are really not economic for Asian economies to consider. Nor is it economic for Uk to subcontract it to them.

The product you are talking about has already left the UK.Its last centurys headline  news.

Even the car plants in the Uk are in effect niche and not high volume for cars. JCB- niche and so on.

Volume/low quantites  is a difficult concept. I just ordered 20,000 springs. 20,000 sounds alot. Its 4/5 hours on a machine in the UK. Not worth bothering going to China for with shipping etc.5 million would be a better number for Asian markets.

And it will do, because those delays are symptomatic of the problems that are now faced.Those will not just vanish overnight.Here for a good few years.

https://yorkshirebylines.co.uk/the-digby-jones-index/

AMAZING

The reason remainers (outdated concept btw, matt, we left a year ago) "chuckle" is not because of queues / issues in month1 year 1, its because the negotiators of the deal promised there wouldnt be be any problems at all. They lied, and they know they did. this is just people who said there would be problems pointing out that there are indeed problems. 

Brexit is harming the economy, as we are losing many many businesses to the EU as a result. Several hundred, large and small, have already gone, several hundred are now planning to leave. there are major structural changes to how we have to trade with the EU (in both directions) which, by the governments own figures, will cost industry more than our net EU contribution, in paperwork / processing costs alone. Even if this additional workload can be reduced, businesses, and therefore the economy, have been harmed because any short term issues feed into the longer term. There is no chance of retrieving what has already gone.

There is always the possibility that the gamble will pay off in a lifetime or 2's time; it is just a vanishingly small prospect, and depends on many other gambles coming good as well.

Similarly, I remember laughing dismissively at the preposterous cartoon characters of Boris Johnson and Jacob Rees-Mogg when they first started appearing on TV, and I didn't take my Father seriously enough when he opined that they were extremely dangerous and not to be surprised if one them, Johnson particularly, became PM one day.

Jones is/was an 'interesting' character. He set himself up very successfully as the champion of British industry, chairman of the CBI etc etc blah blah; in fact it was all bullsh*t, he was a frigging lawyer in a not particularly prestigious law firm specialising in insolvency, hadn't made or even seen a widget in his life. Complete blagger.

I don’t disagree with you at all.

There was always going to be short term costs of reorganising the way we trade. Politicians weren’t clear about this, and should be held to account for that.

However fundamentally, is it better to tie the economy to a bloc that’s growing at c.1% a year and that’s increasingly putting tariffs on goods and services coming into it; or the rest of the world that’s growing at c.3.5% a year?

Over a 20 year period the potential upside is massive.

Some sage advice for you in the second line of this post:

https://www.ukhillwalking.com/forums/off_belay/is_an_independent_scotland_fina...

But the UK was perfectly capable of trading with the rest of the world as a member of the EU. Germany manages a very strong export economy. Why were we not capable of a similar level of  performance? 

Does it? Or rather, does it compete as effectively as it could do?

Take the automotive industry, which Germany is a world leader. It sells incredibly effectively across the EU, but has failed to penetrate America due to the tariffs in place. In China/ Asia, JVs with local partners have been created which have allowed for market entry, but that doesn’t guarantee market dominance over the next 20 years as the local partners look to strike out on their own.

Similarly other hi-tech manufacturing. Yes Germany is a world leader, but increasingly China and other nations are increasingly able to produce the same quality of goods at a lower price. The future looks far from certain for these industries.

In some cases Germany can compete on the world stage because of its manufacturing expertise and quality, but this is despite of, not because of EU membership. 

If the EU puts a 30% tariff on imports to protect domestic industries, then naturally exporters will have to suffer a 30% tariff on exports.

Jesus wept. Have you ever been to a BMW plant in the USA? or a VW one. At least produce some  facts instead of useless incorrect information.Have you ever driven round USA and seen the amount of BMW's ,Mercedes etc.

It exports 4 times as much as the UK. If only we could aspire to half that level of performance. That we have not been able to to do so for the past decades does not give me any confidence that we will start doing so now. 

It sells in the USA by opening factories there - for example, BMW opened their first factory in the USA in 1994. The idea that the German car industry has failed to penetrate America seems a little unlikely.  

And yet you are asserting that UK exports to China and other Asian countries are the way ahead. If the future for world-leading German companies is uncertain, I fail to see why it is not also uncertain for the UK. 

Never knew that, always thought of him as a wind bag.

Based on little knowledge of business and industry, this is the impression I always got of him on QT when he was a fairly regular guest. It was telling that he was very short tempered with anyone who threw a question or point at him which didn't fit with his narrative. Lots of bluster backed up by little substance.

In January 2019 Jones said "I actually campaigned for Brexit and I made it very clear in every speech I gave we would be economically worse off."

Yes I’ve driven around the US and there’s no where near the level of German cars as their are in Europe, but you’re missing the point.

A car designed by Germans, but made in the US by US workers is mainly a win for the US. Only a small portion of profits will trickle back to Germany.

If the car was built in Germany, shipped to the US tariff free and then sold, Germany would benefit far more from it.

Free trade is good, protectionist tariffs are bad.

They sold 375,000 vehicles there in 2019, what figure would mean they have been successful?

Biggest smile on my face one day was spotting a US VW Jetta amongst all the American crapmobiles at a car hire place in LA.  “You and me, we’re going to have some fun” I said to that car.  Never let me down.  One hairy moment in a dried up river bed where I struggled to keep all 4 wheels on the ground...  California has endless amazing mountain roads as well.  

Made in Mexico, I believe...

Like this?

The United States bought 27.2 billion euros’ ($31 billion) worth of German vehicles and components last year, making it the largest export market for the German auto industry, according to statistics released by Berlin’s Federal Statistics office this week.

Together the Germans, including VW, Porsche, Mercedes-Benz BMW and Audi, sold 1.34 million cars and vans in the United States last year, according to German auto industry association VDA.

German companies built 750,000 luxury cars at U.S. plants, of which 44 percent were sold locally and the rest exported overseas, including 95,000 cars to China.

Around 690,000 German vehicles sold in the United States last year were imported from factories within the European Union, of which 470,000 came from German plants, VDA said.

Was it gear shiftf? Once got in one in KY and amazed to find it was a gear shift not automatic. The owner was a big fan of " gear shift " cars.

Its a global company, you miss the point.

Sadly not, sadly not.  Still a heck of a nice car.  5 cylinder turbo resembling half an R8 engine.

Bet you enjoyed that hire!

My ideal holiday would be driving San Diego to British Columbia in a stick shift cross crossing the Sierras then driving back in a decent EV.

But its beyond that. we have lost a significant amount of GDP, employment, and assets held in the UK. This is a permanent diminution of our economic size and scale, which will take longer to recover from. Remember the govts own estimates of an 8% diminution in GDP? 

but the EU is not increasingly putting tariffs on goods and services coming in (japanese deal signed a year or so ago?, negotiations with australia? The list of several dozen countries we used to be able to trade wih freely as a member thsat we are having to renegotiate with?

The 3.5% from your rest of the world is built on a lower cost base , especially labour cost, and exports to wealthier markets such as us. We are not competitive on a bulk basis with them because of the cost base and as neilh said above, the volumes of basic products is a factor several times higher than we here would recognise.

But smaller than it would be as part of the EU, and starting from a lower base.

Because its several thousand miles away. There are very few American cars in Germany, despite the USA having a very significant Auto industry. because its several thousand miles away.

Did you have special insurance?...I was amused US car hire and rescue doesn't cover off road driving, even for a 4x4. Teetering along a ridges on a Phoenix dirt road in a 4x4 with a serious risk of tipping over, dropping off the edge on steep icy switchbacks in Canyonlands and even carefully negotiating eroded dirt roads in southern Red Rocks approaches in ordinary saloon cars, all had me crossing more than fingers.

I believe pleading the fifth would be appropriate.  I don’t believe rescue would have been covered.  A thought very much on my mind on a deeply rutted dirt track somewhere near Umpquah Hot Springs. I did pay for the total damage waiver however....

Align ourselves with the rest of the world  ? what a ridiculous statement.

As for delays at Dover it only takes a month of delays to bankrupt a company or drive a suppliers or customers elsewhere, given that a vast majority of our GDP is generated by trade with Europe exactly where are these new markets coming from?

What about those like me working in service industries like renewables, shipyards or offshore oil and gas ? The need for a Visa now shuts me off from work in several large markets now .

Out of interest whats your experience and background in growing an overseas market for a Uk company?Talk me through what you have done.

You seem to be equating "BMW" to "Germany". If BMW find that opening an assembly line in the US not only overcomes the tariffs, but also a load of other problems (different regulations, quotas, shorter supply chains) then BMW make more money. The tax paid by BMW (US) would no doubt be based on US profits - so they would probably set up some arcane "licensing" deal whereby they only make $10 a year the rest is swallowed up in intra-company costs and ends up in the Cayman Islands. 

It's all a bit more complex than "tariffs bad, free trade good"

This notion that somehow the UK can re-generate it's manufacturing capabilities and 'exploit' these new markets isn't a realistic proposition for one reason - people.

I've spent my whole 35 year career in engineering and manufacturing and the over-whelming trend has been downwards - I've been made redundant 3 times and 'at risk' numerous other times. I've seen numerous organisations for from thousands/hundreds of employees to zero.

For the last 5 years of my career, I spend working across industry and government to address the skills challenges faced in the UK. Each year for the next decade, we face a deficit of about 50,000/year in terms of those retiring as engineers and technicians vs those coming out of further/higher education. Those worst affected were SME's - typically family businesses - as espoused by Sir Digby.

We ran a pilot programme to train apprentices on behalf of SME employers (we were one of the UK's leading engineering companies / frequent UK Apprenticeship Award winners) We approached 500 employers in one region - we got 10 to participate. May felt that the economic uncertainty in the UK meant it was unattractive.

Similarly, we did a skills survey that many employers didn't train and would either poach staff from other businesses or rely on immigrants - not healthy or sustainable.

As well as having people, there needs to be a level of investment in technology to deliver world-class capability. One feature throughout my career was trying to convince accountants that I had a valid investment case - too often they wanted a positive return in 3-5 years due to shareholder pressures. In countries like Germany, it can be 10 years and longer due to different ownership demands.

This is my experience as well. The idea that our manufacturing failed to thrive in the EU was simply because of our membership, is bizarre. We won't thrive outside either unless we honestly identify everything that is different about our manufacturing base compared to Germany and France, etc.

And I think investment strategy is a major part this. I'm sure the massively 'corrupting' influence is our property market. Banks, other lenders and individuals all know the steady returns you get from sticking money in property and any industrial investment opportunities have to match these returns in both level and time scale. No one wants to take the risk of backing a unproven product when the sure fire alternative of a shiny new tower block is available. Other European economies don't have our fixation with the property market.

Hopefully a government lead, massive house building scheme and a continuing collapse of the speculation around places like the Nine Elms development in London, will see this golden goose lose its shine a bit and money might then look for other ways to see a return.

Won't happen though.

The Germans play the long game and, as a result, win.  They have what they call the 'mittelstand' - small-medium manufacturing businesses.  Every town or village has a small industrial estate housing these companies, and invariably one company in each one will be in the top ten in the world at what it does. The owners prioritise excellence over profit and as a result reap the long term gain.

BTW, you're not coming across as someone who knows what they're talking about. It may just be your poor presentational manner.

You really are insufferably condescending, or is just your presentational manner?

My memories of the British economy before EU membership don't include  "low-tax, lightly-regulated, global trader and home for inward investment....."  The only money that ever came into the UK seemed to be bail-outs from the IMF while British companies either went bust or where sold overseas. Of the four engineering companies I worked for two went bankrupt, one moved all manufacturing abroad and one was bought by the Japanese.

I certainly don't. Growing up in a fairly working class environment in Scotland, nobody wanted to be seen to be slow to put their hand in their pocket - even when they really couldn't afford to do so. In the village pub, it was customary to buy a round for the whole bar when you walked in, and if you were on the next don't your always be eyeing up the pints trying to make sure you got yours down get enough to get up to the bar before anyone ran dry.

It wasn't until I moved to London for work that I started to come across that sort of attitude, and it was always people with money that I met through work - the guys who hung out in the spit and sawdust pubs I frequented down there were no difference from the working classes I grew up with.

I source some parts from  Mittelstand engineering companys.There is very much a mixed view on this.Some are experiencing real future skills shortages due to an ageing workforce and will openly admit it.Germany for example is a power house in textile machinery. But it is becoming harder to attract younger technical people- its not got the right image of the future. I buy in a German electromechanical clutches- same issue.All that glitters is not gold.

Its a mixed picture.Some excellent but some areas struggling.I would add just like the Uk and quite alot of countries.

I would add, if you want to get an idea of some of the innovative stuff going on in Uk manufacturing then go visit some of the Catapult High Value Manufacturing centres dotted around the UK. Might open peoples eyes a bit to some of the issues being tackled and addressed.

Years ago when I was doing economic history at university part of the course was studying the economic journals and bank reports from the turn of the 1900s. Basically they all said the same thing: Germany was whipping our arses with a better, more integrated education system, much closer cooperation between industry and education (one of the factors in the battle of Jutland was the better optics that Germany had, developed by the University of Jena and manufactured by Zeiss), much greater respect for manufacturing and industry leaders at a time in the UK managers were supposed to be amateurs, (and judging by the current Cabinet, still are), and emphasis on long term investment.

They're well worth digging out - very little seems to have changed in the last 45 years or so when I first read them.

I am not sure that the Battle of Jutland is a good example of technical German prowess... both sides failed to achieve their objectives.It can hardly be described as a resounding and clear cut demonstration of Germany "whipping our asses".

I am always hesitant about any claim about Germanys prowess in this area , the net results of industry and education cooperation in that period are hardly glowing. Just on that alone I would prefer the UKs amateurs by a considerable mile.I would like to think that most of us would agree on that.

My whipping asses comment was in regards to industrial development, not the battle of Jutland which was, at best a draw.

Germany had a whole infrastructure of polytechnic-type institutions closely allied to local industries at a time when our redbricks were still being weened away from the classics, and 40 years before polys made their promising but brief and soon snuffed out appearance.

I'm not aware of many amateurs who can knock up printing presses, cargo handling gear, industrial quantity chemicals, mining gear, the really heavy duty sh*t that we don't see but makes the world go round. JCB seems to be the one of the few honourable exceptions.

Having just finished Douglas Murray's horrifying Strange Death of Europe, I really don't see that Brexit is anywhere near as big a deal and we like to believe.

The EU will survive or fail on-the-back-of it's approach to mass immigration.

Murrays analysis of the figures suggest that it's doomed.

It's a real problem, partly to do with an ageeing population and partly due to being cursed by success. The previous and expiring generation built a good standard of living based on good education and disciplined work ethics coming from the post-war economy and now the coming generation are looking for something different or better, their dreams aren't of a good job at BMW, it's being the next Elon Musk (my kids are 16 and 17 by the way).

One critisism of Fr. Merkel from outside Europe was allowing 1.5m refugees into the country but the IHK (the German CBI) encouraged it, bringing in shedloads of hard-working, motivated young people has certainly tempered the effects of the demographic change in both manufacturing and the health system as did the Indian influx to the NHS in earliet years. Now we are getting a points system to try and bring in more skilled workers.

The current rate for cash in the hand black work where I live is €25 an hour for unskilled work, if you can find someone!

This thread is exhibiting a blinkered focus on manufacturing as the benchmark of economic success and on the export of physical goods as the only measure of Brexit. Manufacturing is less than 20% of our economy and I can promise you that, even adjusted for any detrimental effects of Brexit, that proportion will keep falling indefinitely.

While UKC wallows in 20th century notions of what constitutes an economy, the inexorable trend of digitalisation extends its reach into every aspect of your lives. Think what the development of online learning means for UK universities coveted by a Chinese middle class that increases every couple of years by more than the entire UK population. Ponder developments in genetic sequencing that the UK is pioneering. These don’t need components, so much as intellectual and digital capital. And they certainly don’t get exported through Dover! Look at the UK’s success as a nursery for fintech innovation. You can access its products from anywhere in the world by downloading to your smartphone.

The argument for Brexit goes that we will have freedom to promote national champions in the above industries, and others, to world class status. It’s a proven concept and a path outlawed within the EU. Those who argue against Brexit point, with some justification, to early signs of damaging disruption to flows of trade between the UK and Europe.

Studies show that both sides are wrong. In the long run, grand government initiatives, benign or malignant, make not the slightest difference to economic prosperity, at least within the capitalist system. Companies and entrepreneurs adjust to exploit the available opportunities and the UK’s future depends very little on the existence or otherwise of trade deals and almost entirely on our development and exploitation of digitalisation and growing consumer economies.

Hint: SE Asia is growing at 5 times the speed of Europe.

It’s perfectly true that opportunities in Asia and elsewhere can be exploited from within the EU. But it’s also true that companies and entrepreneurs can become too comfortable with well established trading links to the detriment of their exploitation of better opportunities elsewhere. A classic example would be the UK fashion industry. There is a harrowing article in the FT this week that details the struggles of UK fashion wholesalers and retailers to maintain the flows of European trade in the face of what will either prove to be teething or structural barriers arising at the end of the Brexit transition period. But the same newspaper has been carrying articles this week about the success and far greater profitability of European fashion enterprises growing their business in China at galloping rates, while sales in their home territories slump. If Brexit is the kick up the arse that UK businesses need to think global, then the hard data suggests it will be to their benefit, albeit not without pain, loss and rebirth. But that’s business.

My biggest completed orders this year have been to China..... and then Vietnam .....

Well done that man 😊

I wouldn't hire you as a business or financial advisor! Your rant is disjointed, contradictory and doesn't seem to come to any point.

The effects of Brexit on manufacturing are clearly identifiable as they are relatively immune from Covid, the effect of Brexit are impossible to quantify on the service sector are more ďifficult. We don't for example know the long termf effect on tourism (the second largest service industry) nor do we know how large the approaching recession will be and it's knock-on effect will be on property value (the largest service sector). A country such as the UK without a thriving manufacturing sector is a dead man walking, people buying Starbucks coffee does nothing to increase the wealth of a country.

I'm on China, the USA and then SE Asia followed by Norway, pain in the ass being in the EU.

I don’t care whether you want my advice, nor was there any effort to provide it. But I would hold that my post aims for balance, neither seeking to support nor condemn Brexit. I simply  pointed out that it would ultimately prove irrelevant.

I agree that there’s no future selling each other coffee. But your apparent view that the future of the most advanced economies lies in their manufacturing prowess is precisely what I was criticising in my earlier post.

Got a take-away from our local deli for lunch... they said they couldn't get olives on their latest orders and had several other supply and cost increase issues since Jan 1st.

It's true that manufacturing is a small proportion of the economy, but I don't think that means it's not important.  We often hear that the UK economy is now driven by services, and that that's a good thing.  But it's a mistake to think that "services" constitutes a single sector.  There's a huge difference between, say, high value design or legal services, and low value retail or hospitality.  If you look at the UK economy in terms of what areas are both a significant fraction of the economy and have a record of productivity growth, three sectors matter - knowledge intensive business services, information and communication technology, and manufacturing.  

Not all manufacturing is equally valuable, of course, but its most dynamic sectors - aerospace, automotive, pharmaceuticals and chemicals - are disproportionately important in their share of UK exports, and in their potential for more growth.  And drawing a sharp line between services and manufacturing is unhelpful in other ways, as this neglect the big linkages between high value manufacturing and high value services.  Many aspects of high value services directly serve the manufacturing sector and wouldn't exist without it - for example the relationship between contract R&D and the pharma sector.  High value services and manufactured products are sold bundled together.  

I think it's also been a bit of a delusion that one can separate intellectual and digital components of a complex product or service from the physical parts that are actually manufactured.  There's a huge amount of know-how that's embodied in the process of making a high value product - whether that's an aircraft or a bio-pharmaceutical - and many companies that have thought they could make a living on the basis of some patents they hold, while contracting out the manufacturing, have learnt the hard way that the manufacturing know-how often ends up more valuable than the foundational IP. 

I was going to post something along the lines of your last paragraph but less concisely and clearly put.

 “Service industry” applied to “biotech/pharma” is by no means all “digital”.  It needs stuff - consumables and for manufacturing the technology designed and built for and used by the service component.   Complex supply chains with a lot of European involvement.  Common standards and open borders help the flow of stuff critical to providing a service model.

On a more positive note. Maybe counting their lucky stars that they can sell something might be a better way of looking at it. Most retailers are closed down. 

 At least there is cash going through the tills!

I remain unconvinced that large sectors of the economy can realign itself to selling  outside Europe. I know the picture is mixed and I expect Financial Services to do fine as a result. But the rest it’s marginal

Digitalised  B2C have just effectively had a whole market swept away and it’s not going to be replaced by China , USA etc. All those company’s selling online to Europe have probably  been wiped out unless they can move their warehousing into Europe.

Staunchly Remainer FT has an article today explaining how EU-based companies exporting to the UK are setting up distribution subsidiaries or partnerships over here, adding to overall UK economic activity, while ports in the north, like Liverpool, are booming on the reconfiguration of container traffic.

In other words, an extra layer of costs, bureaucracy and friction is being added and some are profiting off of it.

Indeed. But in the case of UK-based warehousing partnerships the costs are falling on the EU and the profits to the UK. Given the disparity in trade volumes this is potentially one unintended but substantial net win for the UK, which is the opposite of what UKC is hearing in their Guardians. Or FTs until this morning, for that matter.

Empty lorries returning to the EU...exports down 68%.

I like you're positivity..As one door closes,another one opens....👍

And it seems to me you are cherry picking on a technicality and missing entirely the bigger picture.
 

I will be more specific. Those small businesses will be impacted severally. Like the Cheshire cheese maker and that fish transport business the bbc have been following. Your big businesses will just realign themselves. I would not like to be in their shoes. 
 

container freight traffic has increased because companies like mine are no longer using airfreight. COVID has killed that market. So I now use container freight to USA. I suspect there could be a false interpretation of what is going there

I’m simply quoting a respected economic journal to provide some much needed balance.

You mean the EU exporters don't add the costs to the price? My distributors have to, like most businesses it's FOB.

Too early on those figures. Need a good few months before you can really say. 

Don’t confuse engaging in cherry picking and golden mean fallacy with « providing balance »

Forgot to add. I now use Liverpool to New York sailings(interestingly the sailings then go through Great Lakes and then back).

one of the impacts of COVID is that seaports all over are struggling partly because they have issues on COVID shutdowns.so in New York there have been delays unloading ships as people are hit with COVID. There has been a push for example for “longshoremen “ to be treated as critical workers. It’s all messed up and difficult to make any conclusions  imho.

Which then favours native UK competitors, who become more price competitive, much as the opposite pertains with flows into the EU. There’s simply too much hysteria today with people picking on individual difficulties as universal - encouraged by lurid and misleading headlines such as that in the Observer today. 

A good moment to repeat that all relevant studies have shown that policy interventions of the Brexit type are short term disruptive but have no long term consequences for a nation’s economic health*. Much more powerful forces are at play.
 

* To which one could reasonably ask, why bother with Brexit at all? But I’m here to offer balance, not lead the cheering.

Did you read the article beneath that statistic? Exports aren’t down 68% - or anything like. Most of our exports aren’t even goods!!

How about “widely anticipated and government-heralded disruption at ports during first month of new trade regime in middle of global container crisis brought on by pandemic”?

A good few month...April Perhaps?...

I like you're responses,last one being 'Price fixing is a dilemma '...

I do agree with that sentiment.

Not sure which one you mean but thanks for the support 😊

https://www.telegraph.co.uk/news/2021/02/07/hauliers-say-exports-european-u.......

Just took this at value

I'll put my arm round you if it helps....😉

Actually, most relevant studies, for what they are worth, have shown clear long term impact which far exceed the short term impact.

You aren't providing balance, you are engaging in magical thinking and then try to make us believe that the truth lies in the middle between propaganda and reality.

When it comes to Brexit, the proof will be in the pudding. The rest is marketing bullshit.

You’ve clearly missed my point when I earlier referenced the same statistic. I’ll leave you to work it out.

Those are future-gazing studies of the potential impact of Brexit. I’m referencing long term historical studies of the impact on economies of government-led changes in trade. These show no meaningful long term impact, albeit plenty of short term disruption.

I'm not sure I understand you..Are exports down 68% through the ports,as described,to the EU or not?

Isolate the reasons if you can.

Which studies, exactly ?
Seems like a ridiculous statement.
From mercantilism to liberation of trade the historical impact of government changes to trade is more than bleeding obvious.

Only just edged out by services due to the decline in British manufacturing. We see how services decline with Brexit!!

Try Robertson & Lane 2003 “Can government policies increase national long-run growth rates”

Of course it’s probably just magical thinking.

I am still not a  fan of Digby Jones though..........

Is that all a quick google for something you could cherry-pick to confirm your own bias could muster  ? A minor paper with two minor citations, and one that doesn’t even support your claim.

This study was cited in the FT as hard historical data and analysis to contrast with the guesswork of Brexit futurology. 

Didn't quote the conclusions in the abstract either;

"We conclude that: (i) there are few, if any, feasible policies available that have a significant effect on long run growth rates, and; (ii) any policies that can raise national growth rates must be international in scope. The results therefore have bleak implications for the ability of countries to affect their long run growth rates."

In other words under Brexit the UK is powerless.

No. In the words of the FT’s economist, in the long run, Brexit will prove irrelevant. That’s what the study shows. Maybe read it before you comment.

So if the FT person disagrees with the conclusions in the paper why is it quoted?

https://www.bbc.com/news/uk-england-york-north-yorkshire-55894650..

And in the meantime.

He doesn’t. You haven’t thought it through.

https://inews.co.uk/news/business/fishing-industry-23-million-bailout-plast...

Is this money well spent?

Sorry you had me laughing there. I mean have you even as much as scoured over the « study » you quoted ?

All they did us to take 17 specific countries, (which had pretty much followed the same politics for the past 30 year), and did a pretty useless statistical analysis on GDP to come up with a conclusion along the lines that « the hypothesis that government policy does anything cannot be confirmed from this dataset ». BTW nothing to do with trade. 

Back in the real world anybody can see that trade policy and politics has a impact on economies. There is a reason why North Korea is poorer than South Korea.