You remember Hermann van Rompuy? He’s the one that some people (including myself) referred to rather discourteously as Rumpy Pumpy (incongruous, that), and of whom our leader Nigel Farage once had some choice words to say. I myself once compared him to the character Dr. Coppélius in Délibes’ ballet Coppélia.
Van Rompuy, a previous Belgian Prime Minister, became “President of the European Council” in 2009, and remained so until 2014. He’s a harmless and inoffensive looking chap – though looking at his pictures, I struggle to believe that he’s nearly four years younger then me.
I bumped into him after a recent event we both attended, and I asked him why, when discussing Brexit, he always talked in terms of the comparison with Norway. Why does he say: “You still have to obey the rules – but you have no say in making them. And you still have to pay for market access”. Well of course, he replied. “But we don’t want the Norway option”, quoth I. We simply want to be an independent country, like the USA, or Canada, or (South) Korea. And of course we want a free trade deal”.
Rumpy looked at me with a marvellous mixture of incredulity and derision. “You expect a free trade deal with the EU? You’ll be lucky!”. I only had time to reply “You’d better ask those guys at Mercedes” before he was off and starting another conversation.
Van Rompuy needs to think again — indeed I suspect that he understands this situation very well, and his instant dismissal of a post-Brexit FTA is a calculated and cynical negotiating and campaigning position, rather than a reflection of reality.
The first point to bear in mind is that item “You won’t have any say in making EU regulations”. In my sixteen-year experience as an MEP, I’d say we had precious little say as it is – our current UK voting share in the EU is about 8%. But take a global view. We don’t have any say in American or Chinese regulation – but no one agonises about it. The assumption HVR makes is that we’d still accept EU rules after Brexit. We won’t (that’s quite separate from the issue that exports to any overseas destinations must meet the specs and regulations of that market for that product – but that remains true whether or not we’re in the EU).
We’re not looking for a semi-detached, peripheral Norway option. We’re looking for plain vanilla independence, such as most other countries in the world enjoy.
But the key issue is the FTA. First point: let’s get it in perspective. If we left without any trade deal at all, and were treated simply as an arm’s length country outside the EU’s Common External Tariff, then the total duty liability under that tariff on UK exports to the EU would be around £3½ billion — but we’d be saving £12 billion on contributions (and arguably tens of billions on regulatory costs). Even in those simple terms, we’d be better off. The UK government could offer to reimburse those duties to exporters, and still be ahead of the game.
But then we import nearly double the amount by value from the EU that we sell to them. That’s a bad thing — but the silver lining is, it gives us massive clout in negotiating trade terms. The balance of trade in the automotive sector (which we hear so much about) is much the same. If they want us to offer market access to their BMWs and Mercs and Audis, they’re going to have to reciprocate for our Nissans and Toyotas and Jaguars. Hence my “Ask the guys from Mercedes” retort. Major EU businesses, including the vital automotive sector, will bring irresistible pressure to bear on the Commission for an instant free trade deal. We will, after all, be the largest gross and net customer of the rump-EU (sorry Rumpy). Bar none.
I’m happy to trust former CBI top man Lord Digby Jones, who has said that when we leave the EU “We’ll have a free trade deal in place within 24 hours”. He knows whereof he speaks.