More than a decade ago, Ken Clarke and his fellow €urophiles were warning us that unless we joined the €uro, our economy would be wrecked. Financial services would move en masse to Frankfurt. Foreign investors would shun us. We should be left behind. But he was wrong. It is the €urozone which is wrecked, with record unemployment, and some southern European countries facing poverty and despair on a scale unseen since the thirties.
But Ken, like the Bourbons of old, has learned nothing and forgotten nothing. He pops up in the lead story in Tuesday’s Telegraph insisting that “Quitting the EU would wreck the economy”. OK Ken. Just like not joining the €uro?
But Ken does raise one important point which we shall hear more and more, and will have to address. The EU has negotiated free trade deals with many countries, and is currently negotiating many more. One of the most important is T-TIP, the Transatlantic Trade & Investment Partnership. This (if completed) will be simply the biggest international trade deal that the world has ever seen (OK, you could argue about the Uruguay Round), and will be a clear net benefit to the USA, and to the EU, including Britain.
Where will Britain be when we leave the EU? Will we lose the benefit of all those deals? I think the short answer is this: that it will be hugely to the economic advantage of everyone concerned if a newly independent UK is grandfathered in to these deals on the same terms. I see no percentage for any trading partner in re-opening these extensive and complex trade deals. And there would be potential downsides for companies and national economies in any uncertainty that was created around the UK’s status.
More than that: I suspect that the UK would already have negotiated free trade deals, perhaps years ago, with the USA, and with Canada, India, Singapore and other Commonwealth countries, if we hadn’t handed over our trade policy to Brussels in 1973.
Nor is it clear that T-TIP will go ahead. Already the French have lived up to their stereotype as the continent’s arch-protectionists, demanding the exclusion of audio-visual markets to protect “French culture”. (Note to Hollande: if French culture and movies were that good, they wouldn’t need protection. You already have the protection of a minority language). This is to be the up-front price of French acceptance of the EU’s opening negotiating mandate.
With audio-visual excluded, the Americans may demand the exclusion of public procurement, or aviation, or whatever. The whole thing could yet break down, which would be very damaging. Again, we might well be better off negotiating on our own account.
But I really want to challenge one point in Ken’s Telegraph article. He rightly says that the British are “intrepid, relentlessly outward-facing adventurers”, but adds “not isolationist John Bulls”. Wrong comparison, Ken. You should have said “Not inward-looking, self-referential, protectionist Europeans”.
He cites, without comment or justification, the lazy old €urophile canard that outside the EU, the UK “would be forced to trade by EU rules which it has no say in setting” (not that we have much say now). If challenged, he would no doubt make the clichéd Norway comparison. But the EU is not Norway. We are a top-ten global trading nation, somewhere in size between Canada and the USA. Do Canada and the USA “trade by EU rules?”. Does Japan? Or Korea (with which the EU has a free trade deal)? Of course not. And nor should we.
As the EU’s largest trading partner (which we will be after independence), we shall trade on very favourable terms indeed.
I shall be writing to Ken to ask why he keeps making this nonsense comparison. If he replies, I shall share his thoughts with you. And I only ask because I want to know.