Well, I'm presuming the UK walking out on the EU with all associated 'free trade' benefits will be met with something other than a handshake and a smile. The EU was intended to do away with cross border import tariffs and so on, so if we're not in it why wouldn't they go back to the way it was?
Is there a strong argument or theory about how things would go if we pulled out? Seeing as we manufacture and export very little comparatively and the EU would presumably respond to our exit with punitive tariffs all over the place, and probably strict or prohibitive work permit requirements (as would we i'm sure), I'm genuinely interested what the overall impact would likely be to the economy. A lot depends on the EU response in some ways I guess but their stance on Greece debt wasn't encouraging.
That's taking aside the issue of what would happen to our already poisonous nationalism
We have run a trade deficit with the EU/EEC since 1973. Why would they hit us with tariffs?
This is why I'm asking the question, are people just assuming we can walk away getting everything we want and nothing will change for the worse?
A refusal to sign a FTA with the UK would be the EU cutting its nose off to spite its face. They need us more than we need them, remember this. If they are capable of pursuing such a policy of vengeance then why would we want to be part of such a union?
I would't put it past them to do that but why should we be held by the balls by the EU? They'd back down eventually, when they realise how much money they are losing, and in the meantime we'd have signed a FTA with China, India et al and be capitalising on the growth of economies outside of the EU customs union.
and on that customs union... When we joined the customs union in 1973 it accounted for a whopping 37% of world GDP, by the 2025 it will be just 22% thanks to emerging markets elsewhere in the world, emerging markets that we don't have the ability to sign FTA with. In the EU we can't sign our own agreements with non-EU countries and must instead wait for Brussels to get round to it. This affects us disproportionately hard as, in 2012 (the only figures I've got right here), 57% of our exports were headed for non-EU economies, while for reference only 22% of Belgian trade was efferent. Pretty much every country that we could improve trade relations with are growing at much higher rates than the EU is currently; eg BRIC and other emerging markets like Indonesia.