3 ms·

"No one (apart from Brexiters) cares that much about tariffs. EU tariffs are some of the lowest in the world - the average applied tariff for imports into the E

"No one (apart from Brexiters) cares that much about tariffs. EU tariffs are some of the lowest in the world - the average applied tariff for imports into the EU in 2019 was just 1.88%. Compare that to 6% for India or 13% for the US." Bizarre comment. You initiated it by suggesting the UK has erected "giant trade barriers" but then reply saying nobody cares about trade tariffs? And then immediately in the second sentence go on to compare trade tariffs globally? What exactly is your point as it isn't really cutting across?

fundatus 5y ago
My point is that UK politicians are obsessed with tariffs and free trade agreements, while in reality those play a minor role (as EU tariffs are generally very low). What really matters to companies though are non-tariff-barriers (regulations etc). By deciding to leave the single market, the UK has erected huge non-tariff trade barriers with their biggest trading partner (the EU).
rsynnott 5y ago
As mentioned elsewhere, the tariff aren't the issue for most industries; non-tariff barriers are. I would think the UK's plan for a sort of parallel REACH regulation (REACH is the EU's chemical regulation) after the transition period ends would be particularly burdensome for the semiconductor industry.
- nbevans 5y ago
  Two questions: Why would copy-pasted (from EU REACH) "UK REACH" regulations present more of a burden to the semiconductor industry than EU REACH? What NTBs exist that are known to affect the semiconductor industry?
  - fundatus 5y ago
    Because it's now two things to care of. Which will diverge eventually, even if only ever so slightly. If not, what's the point of the whole exercise? It just adds additional friction. Whereas when you set out your supply chains within the EU single market you don't have to deal with that.
    - nbevans 5y ago
      That's your take. Business' take is that they are more than willing to invest the time to find nuanced subtle differences between countries regulatory environments so that they can exploit them for monetary gain. The UK REACH and EU REACH regulations apply to production process - not to the finished exportable product. Hence TSMC in this case would only need to implement REACH within the country it has chosen as its production base. Between the choice of the UK or EU - this would mean it is still only "one thing" to take care of. Unless it ever intended to open production bases in both territories - in which case the territory with the "older" version of REACH would almost certainly win any "ease of doing business" test - so probably the UK at some future date once EU REACH Version 2 materialises (and assuming the UK doesn't blindly copy-paste it again).
      - rsynnott 5y ago
        Given that the UK decided not to make itself subject to REACH, that presumably means it wants to diverge, which introduces uncertainty. Now, it's _possible_ that having its own copy of REACH was just political posturing (if you're taking the cynical approach, you might assume that this is even likely), but I can't imagine anyone would want to depend on that.
      - nbevans 5y ago
        > "Given that the UK decided not to make itself subject to REACH, that presumably means it wants to diverge, which introduces uncertainty. Now, it's _possible_ that having its own copy of REACH was just political posturing (if you're taking the cynical approach, you might assume that this is even likely), but I can't imagine anyone would want to depend on that." There is no difference to TSMC. The UK "diverging" i.e. making changes to its UK REACH regulations, versus the EU making changes to its EU REACH regulations. To TSMC these events would be one and the same. Uncertainty exists at all times. Business recognises this and, like the Internet, routes around it when possible or otherwise just absorbs it and gets on with business. The UK copy-pasting EU REACH into UK REACH was /obviously/ done for business stability and environmental reasons and because generally it was just the right thing to do. Painting it as "political posturing" is certainly a highly cynical even hyperbolic interpretation.

fundatus 5y ago

My point is that UK politicians are obsessed with tariffs and free trade agreements, while in reality those play a minor role (as EU tariffs are generally very low). What really matters to companies though are non-tariff-barriers (regulations etc). By deciding to leave the single market, the UK has erected huge non-tariff trade barriers with their biggest trading partner (the EU).

rsynnott 5y ago

As mentioned elsewhere, the tariff aren't the issue for most industries; non-tariff barriers are. I would think the UK's plan for a sort of parallel REACH regulation (REACH is the EU's chemical regulation) after the transition period ends would be particularly burdensome for the semiconductor industry.

nbevans 5y ago
Two questions: Why would copy-pasted (from EU REACH) "UK REACH" regulations present more of a burden to the semiconductor industry than EU REACH? What NTBs exist that are known to affect the semiconductor industry?
- fundatus 5y ago
  Because it's now two things to care of. Which will diverge eventually, even if only ever so slightly. If not, what's the point of the whole exercise? It just adds additional friction. Whereas when you set out your supply chains within the EU single market you don't have to deal with that.
  - nbevans 5y ago
    That's your take. Business' take is that they are more than willing to invest the time to find nuanced subtle differences between countries regulatory environments so that they can exploit them for monetary gain. The UK REACH and EU REACH regulations apply to production process - not to the finished exportable product. Hence TSMC in this case would only need to implement REACH within the country it has chosen as its production base. Between the choice of the UK or EU - this would mean it is still only "one thing" to take care of. Unless it ever intended to open production bases in both territories - in which case the territory with the "older" version of REACH would almost certainly win any "ease of doing business" test - so probably the UK at some future date once EU REACH Version 2 materialises (and assuming the UK doesn't blindly copy-paste it again).
    - rsynnott 5y ago
      Given that the UK decided not to make itself subject to REACH, that presumably means it wants to diverge, which introduces uncertainty. Now, it's _possible_ that having its own copy of REACH was just political posturing (if you're taking the cynical approach, you might assume that this is even likely), but I can't imagine anyone would want to depend on that.
    - nbevans 5y ago
      > "Given that the UK decided not to make itself subject to REACH, that presumably means it wants to diverge, which introduces uncertainty. Now, it's _possible_ that having its own copy of REACH was just political posturing (if you're taking the cynical approach, you might assume that this is even likely), but I can't imagine anyone would want to depend on that." There is no difference to TSMC. The UK "diverging" i.e. making changes to its UK REACH regulations, versus the EU making changes to its EU REACH regulations. To TSMC these events would be one and the same. Uncertainty exists at all times. Business recognises this and, like the Internet, routes around it when possible or otherwise just absorbs it and gets on with business. The UK copy-pasting EU REACH into UK REACH was /obviously/ done for business stability and environmental reasons and because generally it was just the right thing to do. Painting it as "political posturing" is certainly a highly cynical even hyperbolic interpretation.