Monday, 25 April 2016

Some thoughts on Brexit

Some thoughts on Brexit…
  • Trade - Brexiteers believe we could negotiate a deal with the EU under which we could continue to trade as usual, but without having to make payments to the EU, being subject to its regulations, or allow free movement of people. This from the Economist explains why such a belief is fanciful:
"At a minimum, the EU would allow full access to its single market only in return for adherence to rules that Eurosceptics are keen to jettison. If Norway and Switzerland (whose arrangements with the EU many Brexiters idolise) are a guide, the union would also demand the free movement of people and a big payment to its budget before allowing unfettered access to the market.
Worse, the EU would have a strong incentive to impose a harsh settlement to discourage other countries from leaving. The Brexit camp’s claim that Europe needs Britain more than the other way round is fanciful: the EU takes almost half Britain’s exports, whereas Britain takes less than 10% of the EU’s; and the British trade deficit is mostly with the Germans and Spanish, not with the other 25 countries that would have to agree on a new trade deal."
  • The City - The big banks, insurers and other big City players have been pretty consistent in their view that Brexit would harm the City. It's possible they're wrong, but the consistency with which they've expressed their view should at least give you pause for thought.  
  • Immigration - The EU is often attacked for allowing immigrants and refugees – but (with some caveats) I broadly welcome them.
  • Politics - Finally, of course I accept that being part of the EU entails some loss of sovereignty, but for the reasons above and others, I think it's a price worth paying. And at least if we're in the EU we can influence the EU; outside, we risk incurring many of the costs without the benefits - as a Norwegian minister once put it, “if you want to run Europe, you must be in Europe. If you want to be run by Europe, feel free to join Norway.”

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