A Canada-style Brexit deal is the obvious and rapid solution
Despite Brexit being the dominant story in the press for the past two years, there is a distinct lack of understanding of the EU amongst our political class and commentariat – of what it is, how it operates and its direction of travel.
Many in the metropolitan bubble appear to have only discovered the EU when the referendum was declared, including sadly, members of our government, and it is clear that those in opposition still have little understanding.
Those amongst Remainers who did and do understand, have been determined to adopt a fictional narrative, as they have for up to forty years, in order not to “frighten the horses”. For horses, read British Electorate.
The position of Germany, the EU and, in a more nuanced way, France, is to pursue the EU “project” of “ever closer union”. One currency, one finance ministry, one military command, one tax system, one citizenship, one border, one supra national state, with “four freedoms”.
Only with the “four freedoms”, the free movement of people, capital, goods and perhaps one day over the rainbow, of services. This defines the EU internal market and is indivisible from the “project”. It is also a convenient tool for countries like Germany for whom the EU was designed to keep other members locked in and in check and to keep out unwanted competition, since this “freedom zone” is actually a protectionist area surrounded by a wall of tariffs and regulations- in other words, a customs union.
Of course, the expression “four freedoms” was borrowed. The original expression belonged to President Roosevelt who defined them for the citizen as, “the freedom of speech and expression, the freedom to worship God in his own way, freedom from want and freedom from fear. Four freedoms which I would warrant are likely to chime much more with the British People than those of the EU.
Nonetheless, when President Macron recently declared that Britain would have to accept the freedoms, including open borders, and pay into the EU if it wishes to enjoy special “access” to the internal market, he was expressing a perfectly logical and internally consistent message. After all, the institutions of the EU have said this consistently since the referendum and the triggering of article 50, as has the EU Chief Negotiator. “The UK must face the consequences of it decision,” he says with monotonous regularity. The fact that the British government have not got the message and the British establishment are in denial is not the problem of the EU or President Macron.
Macron also gave two alternatives to “special access”, alternatives which already exist: the Norway option or a Canada style deal.
The Norway option carries with it baggage, to say the least. While Norway enjoys control of its own fisheries and agriculture policy and is able to sign its own trade deals outside the customs union, it remains in the Single Market and thus must accept the free movement of people and EU regulations on goods and services traded with the EU and European Court of Justice rulings, without any voting rights. Norway also pays into the EU budget. In other words it is semi-detached, it is not Brexit.
Similarly, Macron’s “special access” would require all of this and some. More money, more regulation, more jurisdiction of the ECJ. The newly won economic freedoms of global trade which the UK may now enjoy would be given away. The rest of Brexit Success – control of money, borders and laws – would be dead rated and we would be economically worse off. It would suit the EU well.
By contrast, the other suggestion of a Canada-style deal, would be a free trade arrangement between two sovereign powers, the UK and the EU, giving free movement of 98 per cent of manufactured goods and 92 per cent of agricultural products, without any of the baggage of EU membership. No ECJ, no EU regulations on other activity, no contribution to the EU budget, no restrictions on fisheries or agriculture policy and complete freedom to cut tariffs or make trade deals around the world. In addition, the UK would be able to set its own economic policy, including tax policy. In other words a free trade deal plus global trade under the World Trade Organisation. The only thing left out is services, but there is no internal market in services in the EU to speak of and that which there is in banking represents about 0.7 per cent of the British economy and would marginally affected by Brexit.
This is the obvious, rapid and acceptable solution. Not only could this be agreed quickly – by October – it would give absolute certainty to business and would remove the need for a blanket transition period, bringing forward in time the benefits of Brexit and further cutting our costs.
John Longworth is co-chairman of Leave means Leave and a former director general of the British Chambers of Commerce
January 27th, 2018: Telegraph