Australia and others ask for Brexit trade compensation

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Ships at Felixstowe

Countries including Australia have asked for trade compensation from the UK and the EU over Brexit disruption.

Fifteen countries, including the US, India and New Zealand, have been setting out Brexit concerns at a World Trade Organization (WTO) meeting in Geneva.

Australian officials said their beef and lamb exporters had already been hit after several Brexit delays.

Brazil said Brexit plans for Northern Ireland could breach WTO rules.

The main issue for the fifteen countries is a system which allows them easier access to the EU’s large market for limited quantities of some of their goods, mainly farm produce.

It’s a system known as “tariff rate quotas”.

World Trade Organization members generally apply tariffs – taxes on imports – to many of the goods they buy from abroad.

For some products they have made commitments to allow specified amounts to be imported with tariffs that are lower than what they usually apply. In some cases the reduced tariff is zero.

It makes it more profitable for Australian farmers to sell beef to Europe, for example.

Brexit complicates this.

Sheep at the Australian Wool and Sheep Show in Bendigo
Australia said beef and lamb exporters had been hit by Brexit delays

The current quotas are for the whole of the EU, the UK included.

Brexit means the UK and the EU have to decide how to divide them up.

Some countries say that could lead to them having less of the favourable access than they currently have to what is a large and wealthy market.

Australia said that the UK and EU had proposed different ways of allocating the quotas that would add up to less access than Australian exporters currently have.

The US argued that it could end up with no access at reduced tariffs for pizza cheese to the UK or grape juice to the EU.

Another concern is that the UK and EU might themselves end up using part or even all of the other’s quota.

The US argued that could severely hit its sales of pork and wine.

Some countries are demanding compensation from the UK and EU. In the WTO that would usually mean reducing tariffs on other goods.

Brexit delays

Australia also argued that it has already been affected by Brexit.

A paper prepared for the meeting said that when Brexit was still scheduled for 31 October, many Australian businesses ceased exports of valuable beef and sheep meat ahead of Christmas because of uncertainty about whether they would be able to make use of these quotas.

The document said similar decisions were taken ahead of a previous possible Brexit dates and will have to be taken again before 31 January.

Demonstrators dressed as custom officials set up a mock customs checkpoint at the border crossing in Killeen, near Dundalk
Demonstrators dressed as customs officials have been protesting against potential Northern Ireland border checks.

Ireland question

Brazil has raised another concern about the plans for customs procedures between Northern Ireland and Great Britain.

Brazilian officials said it could violate the WTO’s rules against discrimination.

The documents the BBC has seen don’t spell out the reason for this, but it is probably based on the plans to have an open border between Northern Ireland in the UK and the Republic of Ireland in the EU.

Combined with the plans for limited checks on goods between Northern Ireland and the rest of the UK, it might provide an opportunity for goods to travel between the UK and EU without restrictions or possibly tariffs that would apply to similar goods from the rest of the world.

Brazilian officials said it was paramount that the WTO’s non-discrimination principle is preserved.

It was not clear, they argued, that the proposed arrangements for Northern Ireland would guarantee that would happen.

Asian shares are mostly lower as investors awaited developments on the trade friction between the U.S. and China at the Group of 20 meeting of major economies in Japan later in the week.

The Associated Press

The sell-off marked the third straight loss for the market and the biggest drop this month for the Dow Jones Industrial Average and the S&P 500 index, which hit an all-time high only last week.

In an early afternoon speech, Fed Chairman Jerome Powell noted that the economic outlook has become cloudier since early May amid uncertainty over trade and global growth. Earlier Tuesday, reports showed a decline in consumer confidence and more weakness in the housing market.

The S&P 500 index fell 27.97 points, or 1%, to 2,917.38. The Dow dropped 179.32 points, or 0.7%, to 26,548.22. The Nasdaq composite, which is heavily weighted with technology stocks, slid 120.98 points, or 1.5%, to 7,884.72.

The Russell 2000 index of smaller company stocks gave up 9.05 points, or 0.6%, to 1,521.04.

Trade policy remains the biggest source of uncertainty looming over the market. Investors are worried about the trade dispute between the U.S. and China and its potential impact on global economic growth and corporate profits.

Presidents Donald Trump and Xi Jinping will meet this week at the G-20. The world’s two largest economies spent much of the current quarter escalating their trade war and giving global markets jitters over prospects for economic growth.

“To a large extent, any further deterioration in trade relations is expected to guide expectations here so the focus remains up ahead with the G-20,” said Jingyi Pan, market strategist at IG in Singapore.

ENERGY:

Benchmark crude oil rose $1.22 to $59.05 a barrel, amid worries about tensions in the Middle East, centered around concerns about Iran, and industry data that showed a decrease in U.S. crude oil inventories. It fell 7 cents to settle at $57.83 a barrel Tuesday. Brent crude oil, the international standard, rose $1.05 to $65.33 a barrel.

CURRENCIES:

The dollar rose slightly to 107.39 Japanese yen from 107.03 yen on Tuesday. The euro weakened to $1.1360 from $1.1381.

Rare Nike trainers sell for more than £350,000

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The 1972 Nike Waffle Racing Flat Moon Shoe
Image copyrightGETTY IMAGES

A pair of rare Nike trainers designed by the sportswear giant’s co-founder has sold for a record-breaking $437,500 (£351,772).

They were the last shoes to sell in an auction of 100 pairs of trainers – from Adidas to Air Jordans – in New York.

The 1972 Nike Waffle Racing Flat Moon Shoe was expected to fetch $160,000.

But Canadian collector, Miles Nadal paid almost three-times that, having already forked out $850,000 for the other 99 pairs in the auction.

The Nike Waffle Moon Shoes were designed by Bill Bowerman, a track coach who co-founded Nike.

Just 12 pairs were hand-made, with a number being handed out to runners at the 1972 Olympic trials, and the pair being auctioned is thought to be the only one not to be worn.

Noah Wunsch, Sotheby’s global head of e-commerce, said Mr Bowerman used a waffle iron to imprint the tread on the shoes.

Media captionFather-and-son Troy and Chase Reed have opened a New York pawn shop specialising in second-hand sneakers

The new owner of the shoes, Mr Nadal – who founded an investment firm, Peerage Capital – said he was thrilled at his purchase, calling the Moon Shoe a “true historical artefact in sports history and pop culture”.

“I think sneaker culture and collecting is on the verge of a breakout moment,” he added, saying he plans to display them, along with the other 99 pairs he bought last week, at his private automobile museum in Toronto.

Back to the Future

Mr Nadal’s haul included two pairs of Nike Mags, shoes made famous in the 1989 Back to the Future Part II because they had automatic lacing – a technology the company didn’t bring to the market until almost three decades later.

The limited edition Back to the Future 2016 sneakers were thought to have fetched between $50,000 and $70,000.

Another star of the auction was the Jeter edition Air Jordan 11, created to commemorate New York Yankee baseball star Derek Jeter’s retirement in 2017. Only five pairs were made. They were estimated to have sold for close to $60,000.

The highest price fetched at a public auction for trainers is thought to be $190,373 for a pair of signed Converse shoes worn by Michael Jordan in the 1984 Olympic basketball final.