Brexit ‘kaosa’ egon arren, datuak ez dira txarrak

Hasierarako, ikus Brexit-ekiko ‘akordioa’ eta exit


Bill Mitchell-en British data confirms strong FDI continues despite Brexit chaos


(i) Mitchell-en aurkako e-postak1

(ii) Brexit-ez2

(iii) Datuak3

(FDI: Foreign direct investment)

(iv) FDI, zein industriatan?4

(v) Eta manufakturan?5

(vi) Zer gertatzen da Europan?6

(vi) Esportazioak?7

Ingelesez: “(…). I don’t know what topic attracts the most hate E-mails that I receive on an almost daily basis: my position on the Eurozone, my position on the EU generally, my position on Brexit, my position of surrender monkey social democrats (parties and people), or my work on Modern Monetary Theory (MMT). I guess I could count and build up a frequency distribution but I just prefer to delete them these days – the first few words give the game away. Save your time. This week, I have had a torrent of such E-mails telling me more or less “see, you claimed Brexit would be good, but it is a disaster”. Last time I checked Brexit hasn’t happened yet. All that we are witnessing is a conservative government of considerable incompetence in disarray after being bullied by the neoliberal, corporatists in Brussels into a ridiculous ‘agreement’ that changed hardly anything. But there were some interesting data releases in the last few weeks that bear on the Brexit question. I have been looking into them.”

Ingelesez: “A little Brexit reflection

The sense of Brexit chaos in the UK has been amplified by ridiculous new reports from HM Treasury, the Bank of England, and some attention-seeking private research groups who choose to lie and present incredulous analyses as fact.

Which government in their right mind would do nothing while the economy was shrinking 7 per cent? That is what HM Treasury modelled.

Which central bank would put up interest rates by 5 or so percent during a deep recession when they know exchange rate depreciation introduces temporary inflation spikes (if that)? That is what HM Treasury were claiming would happen.

Embarrassing the whole lot of it.

And where are the media reports telling the British people about the boom (yes, you read that correctly – there latest data shows a boom) in Foreign direct investment in the UK.


Fakes the lot of them.”

Ingelesez: “On December 4, 2018, the British Office of National Statistics released its updated bulletin – Foreign direct investment involving UK companies: 2017.

Now if the world was about to stop because the majority of British people voted to leave the corrupt and innefficient EU then Foreign direct investment should certainly be recording the insecurity associated with that decision.

We distinguish between:

Outward FDI … direct investments made by UK-based companies abroad, while inward FDI reflects the activity of foreign-owned companies in the UK. The difference between these (outward less inward) gives a net FDI balance.

What does the ONS find?

The ONS reported that:

In 2016, the values of both outward and inward FDI positions increased notably. The UK’s outward FDI position increased by £190.6 billion (or 17.6%) to £1,274.6 billion. The increase in the inward FDI position was smaller than that for outward FDI, growing by £154.8 billion (or 15.0%) to £1,187.3 billion.

And in 2017:

The value of the inward FDI position grew faster than the outward position: a £149.2 billion (12.6%) increase for inward FDI, compared with £38.7 billion (3.0%) for outward FDI … Therefore, the value of the stock of foreign-owned direct investments held in the UK in 2017 was slightly higher than the value of direct investments that UK companies held overseas, which would be the first time this has been recorded.

The HMRC (Revenue and Customs) noted that (Source):

the UK remains a top destination for foreign direct investment (FDI), with inward stock at the highest level since records began 12 years ago.

Now, I am not saying that these trends are desirable per se.

The point is that in mainstream terms FDI inflows reflect a confidence from foreign investors in the future of the nation.

FDI by its nature is not speculative ‘hot’ money.

A more detailed examination of the dataset – Foreign direct investment involving UK companies: inward – produces the following graph.

It shows the Inward FDI by region (and I added the US and Japan) for 2016 and 2017, which the captioned percentages being the annual change.

I didn’t add India but the annual growth in inward FDI from that nation to Britain was 321 per cent from a low base
There was strong

That doesn’t look like a loss of confidence in the nation to me.

Even European investors are growing in their resolve to maintain commercial links with Britain.

Ask yourself basic questions about why people would put money up to invest in British sectors if they thought it was about to collapse.”

Ingelesez: “Which industries attracted this inward FDI?

The following table shows the breakdown by sector for 2016 and 2017, the percentage change over the year and the proportion of total inward FDI.

1. The Financial Services sector attracted relatively strong FDI and is the largest recipient. Hardly a sign that all the banksters are heading abroad.

2. Manufacturing sub-sectors such as food, metals, transport equipment, etc all attracted strong FDI growth.

3. Skilled sectors (Professional, scientific & technical services, Information and Communication) were heavily engaged.”

Ingelesez: “And what about manufacturing?


The latest IHS Markit/CIPS UK Manufacturing PMI for November (released December 3, 2018) showed that:

1. “November saw a slight acceleration in the rate of improvement of UK manufacturing business conditions”.

2. “the performance of the sector remained comparatively lacklustre”.

3. “The trend in output strengthened slightly during November, as new order intakes rose following October’s decline”.

4. “Companies remained confident on balance”.

So not stunning but certainly not collapsing.

There is a continuing confidence level among British producers for conditions over the next 12 months.

Ingelesez: “By contrast, the latest IHS Markit Eurozone Manufacturing PMI for November (released December 3, 2018) shows:

the continued growth slowdown of the single currency area’s manufacturing economy. Although remaining above the crucial 50.0 no- change mark for a sixty-fifth month running, the final PMI came in at 51.8 in November, down from 52.0 in October and the lowest reading since August 2016 …

The euro area’s ‘big-four’ economies posted the lowest manufacturing PMI readings of all countries covered by the survey during November …

Growth of production only marginal as demand continues to falter …

Business confidence remains weakest in around six years

Ingelesez: “And what about exports?

HM Revenue and Custom reported (December 6, 2018) – Exports continue to rise across the UK.

The latest data shows that in the “year ending September 2018”:

Exports of goods from England increased by 3.1% to £247.6 billion

in Scotland, goods exports increased by 6.2% to £29.6 billion

in Wales, goods exports increased by 3.0% to £16.9 billion

in Northern Ireland, goods exports decreased by 0.2% to £8.6 billion

HMRC said that “The most popular non-EU destinations include USA, that 19.9% of exporters sold goods to, Australia (7.9%) and Switzerland (7.3%)”.

Sure enough there has been a generalised growth in world trade, which Britain has participated in.

But British firms are still producing and exporting and the data shows non-EU exports of goods and services are higher than UK exports to the EU (since 2009) and that new, non-EU markets are emerging (HMRC report that (Source):

The fastest growing export market for the UK since 2010 was Oman, with exports increasing by 354% to £3 billion. This was followed by Macedonia (FYROM) with UK trade growing by 318% to £1 billion and then Kazakhstan which was up by 210% to £2 billion.

These new markets are the future for Britain.

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