One of the strangest assertions of the withdrawalist anti-EU camp is that if Britain were to pull out, she would instantly become independent and able to act freely, unhindered by legislation from Brussels that they see as damaging and unnecessary. (Which, to be fair, much of it is – but that’s beside the point…)
Of course, as long as the EU exists and dominates the continent, any other European powers – especially those, like Britain, whose trade is overwhelmingly with their continental neighbours – will find the EU shaping their economies whether they like it or not. Switzerland has to follow numerous EU laws and regulations (in which it has no say) despite not being a member; so does Norway, often hailed as an ideal model for a non-EU UK.
Often forgotten, however, is Iceland. Not a member of the EU, but still – with Switzerland and Norway – a member of the European Free Trade Area (EFTA), which many proponents of a British EU pull-out reckon we should join after severing links with Brussels.
And yet now Iceland is considering joining the Eurozone:
Richard Portes, author of an independent report on the Icelandic economy, said that unilateral euroisation was feasible and need not limit Iceland’s political independence. “Because of the exceptionally high degree of exchange rate passthrough into domestic prices and equally exceptional financial openness of Iceland, unilateral euroisation would not be sacrificing much effective monetary policy independence,” he told the Icelandic Chamber of Commerce.
In other words, as long as you’re a part of Europe and the EU exists, it’s going to have a major impact on the way your country runs. So surely it’s better to have some direct say in what the EU gets up to, no matter how limited? What’s the withdrawalist excuse for this one? I’m genuinely intrigued…
Update: Ah, it seems The Economist covered this a couple of weeks back. I really must get a subscription… (Oh, and on Certain Ideas of Europe too – that’s The Economist’s rather good Europe blog.)
The answer to that is the creation of the Anglosphere as a political entity.
“Of course, as long as the EU exists and dominates the continent, any other European powers – especially those, like Britain, whose trade is overwhelmingly with their continental neighbours…”
This is quite simply untrue, NM. Britain’s trade is overwhelmingly internal, actually. The plit is roughly this: 79% internal, 10% EU, 11% the rest of the world.
DK
How so, when the majority of our trade is with EU countries (France and Germany alone accounting for 21% of all exports, as opposed to 13.9% to the US), and when other Anglophone countries (bar Ireland, obviously) are all thousands of miles away, making trade in goods and services harder and more expensive?
This is an economic question, not a political one.
P.S. Also remember that the UK has the fifth highest GDP in the world, at some $2.199 trillion (adjusted dollars), whereas Iceland ranks at #87 with a mere $15.8 billion (figures here). In other words, Iceland needs the EU far more than we do.
Living in this country, it is easy to forget just how massive an economy we are: only the US, Japan, Germany and China rank above us (although it’s also worth noting that Japan has twice our GDP and the US has 6 times our GDP).
DK
That last comment was aimed at AMI – for DK, that’s somewhat shifting the goalposts. I’m obviously talking external trade – and until Britain becomes self-sufficient, that’s still going to be vital, surely? Or are you arguing that trade with other countries isn’t important at all?
How so, when the majority of our trade is with EU countries (France and Germany alone accounting for 21% of all exports, as opposed to 13.9% to the US),
NM, you did not say exports: you said “whose trade is overwhelmingly with their continental neighbours.” It’s an economic distinction, not a political one.
DK
Without wanting to sound prissy, it strikes me as pedantry – from the context I didn’t think there was a need for a distinction. (I’m also not an economist, so bear with me on these sorts of things – when I say I don’t understand, I mean it…)
In the Economist the same argument was made recently and (self promotion alert) I have written about it, too.
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