UK Unilateral: Post-Brexit Liberalization Potential

24 Pages Posted: 10 Feb 2020

See all articles by Dan Ciuriak

Dan Ciuriak

Ciuriak Consulting Inc.; Centre for International Governance Innovation (CIGI); C.D. Howe Institute; Asia Pacific Foundation of Canada; BKP Development Research & Consulting GmbH

Ali Dadkhah

Ciuriak Consulting Inc.; Infinity Law

Jingliang Xiao

Infinite-Sum Modeling Inc.; Ciuriak Consulting Inc.

Date Written: October 15, 2018

Abstract

This study assesses the potential gains from unilateral trade liberalization for the UK, against the background of a hard Brexit in which a hard border and tariff wall is erected between the UK and the European Union. Unilateral trade liberalization would allow the UK to expeditiously offset at least some of the trade costs incurred in leaving the EU Single Market without a deal as it does not depend on negotiation with third parties, and hence is not limited by trade negotiating capacity in the UK or its prospective free trade partners. At the same time, unilateral liberalization faces the political economy challenge of removing protection in the most sensitive sectors, which is where most of the liberalization gains come from, while also giving up leverage to conclude future trade agreements. A highly ambitious unilateral liberalization scenario represents, in terms of trade structure and costs, a substantial gain but falls short of offsetting a hard Brexit (when both the unilateral scenario and the hard Brexit scenario are modelled on a common set of modelling assumptions and protocols). Based on the modelling results, the main political economy challenge to unilateral liberalization for the UK in a post-EU trade policy context would be the deep negative impacts on UK agriculture.

Keywords: UK, Unilateral Liberalization, Brexit, CGE

JEL Classification: F13, F14

Suggested Citation

Ciuriak, Dan and Dadkhah, Ali and Xiao, Jingliang, UK Unilateral: Post-Brexit Liberalization Potential (October 15, 2018). Available at SSRN: https://ssrn.com/abstract=3520507 or http://dx.doi.org/10.2139/ssrn.3520507

Dan Ciuriak (Contact Author)

Ciuriak Consulting Inc. ( email )

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Centre for International Governance Innovation (CIGI) ( email )

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C.D. Howe Institute ( email )

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Asia Pacific Foundation of Canada ( email )

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BKP Development Research & Consulting GmbH ( email )

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Ali Dadkhah

Ciuriak Consulting Inc. ( email )

83 Stewart St.
Ottawa, Ontario K1N 6H9
Canada

Infinity Law ( email )

200-931 Fort St.
Victoria, V8V 3K3
Canada

Jingliang Xiao

Infinite-Sum Modeling Inc. ( email )

16167,Glenbrooks Pl
Vancouver, BC - British Columbia v4n1t3
Canada
6047245981 (Phone)
6047245981 (Fax)

HOME PAGE: http://www.infsum.com/en/

Ciuriak Consulting Inc. ( email )

83 Stewart St.
Ottawa, Ontario K1N 6H9
Canada

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