Snorvey wrote:Another simplistic question from me I'm afraid....
It was on the news earlier that the UK's trade deficit in goods is close to 100 billion quid.
.
Surely that's £100 billion of stuff we can (mostly) do for ourselves?
In theory quite a lot of it. Some things are very difficult (e.g. oranges) or impossible (e.g. purchases made whilst on holiday in Greece) whilst many other things are much more expensive for us to produce due to various factors (lack of skills, fewer economies of scale, climate, etc.).
Also consumers' preferences for some imports (e.g German cars) may be very hard to overcome, even when we can make substitutes.
This is why it's often more efficient to import goods than make them yourselves. However, changes post-Brexit may make it more efficient to produce some goods here, or at least acceptable substitutes.
This will have an interesting effect on GDP. That's because imports reduce GDP (one of the more stupid parts of the GDP calculation). So if we then produce the same stuff at a similar cost we add that to our GDP so it gets double counted. Of course doing so is likely to reduce GDP elsewhere (by taking resources to produce these substitutes).
IMHO GDP is a horribly flawed measure of our economy. Politicians love it though.