Friday, 14 October 2016

Brexit Negotiations

I will try to explain as much as I know about the current state of the U.K's membership of the European Union and where I believe the future for it lies. I start with many definitions (some of which seem quite complex) with an attached diagram which will hopefully give clarity:

  1. The Schengen Area includes countries with free movement of Labour (open borders).
  2. The Common Travel Area (CTA) allows the free movement of people between Ireland and the U.K.
  3. Eurozone countries use the Euro as its currency (€).
  4. The European Union (EU) is a political union with members sharing common laws.
  5. The European Single Market is the EU's trading area consisting of EFTA and the EU. It aims to promote the free movement of goods, capital, services and people.
  6. The European Free Trade Association (EFTA) participates in the European Single Market without being members of the EU. They adopt most EU legislation concerning the single market with notable exclusions including laws regarding agriculture and fisheries.
  7. Members of both the EU or EFTA can be a part of the European Economic Area (EEA) which has no tariffs on each other's goods.
  8. The EEA differs from the Single Market in that EEA countries abide by the laws of the country the product is being sold in, whereas Single Market countries abide by common EU laws.
  9. European Union Customs Union (EUCU) countries apply a common external tariff on each other's goods.
  10. Many countries negotiate their trade deals with the EU in groups such as the Nordic Council, GUAM, BSEC and CEFTA.

As the EU referendum suggests, the U.K. is to leave the European Union. Leave Voters seem adamant over several key issues, mainly that of control over laws and borders. This rules out being a part of the Schengen Area (which we were not a part of anyway) but it would be sensible to retain our Common Travel Area with the Republic of Ireland. as the Single Market dictates the free movement of people, the U.K. would not be able to retain its membership of it. Given the lack of incentive to raise prices of goods and services from either the U.K. or its mainland counterparts in the form of a tariff, it will be undesirable for the U.K. to join the EU customs union for all those concerned. Therefore, the only remaining desirable outcome for all concerned will be to become a member of the EEA.

As a member of the EEA, we would be trading inside the Single Market with virtually none or little tariffs. We would have to abide by the laws of the country a product is being sold in i.e. British exports to the EU will abide by EU laws and goods imported to the U.K. will be regulated by our own laws. The deal could be similar to EFTA in that we may also control laws over the agriculture and fishing sectors of the U.K. economy.

Given that Scotland has a clear mandate from the Scottish people to remain within the EU, a second independence referendum is inevitable. It is currently unclear as to whether Northern Ireland will follow suit, given they have a similar mandate to remain a part of the EU. It is entirely feasible that they might leave the U.K. to also remain a part of the EU, potentially as a united Ireland without a border between the North and the Republic. In any case, a British EEA trade agreement would therefore only be completed after the second Scottish referendum and the the first Northern Irish referendum has been concluded; either by means of a vote to stay a part of the U.K. or the process of leaving the U.K. has been completed. Given that Article 50 will be triggered by March 2017 and we will have two years to complete a trade agreement, the question of independence for both Scotland and Northern Ireland will have to be concluded as soon as possible, no later than March 2019. Once both countries declare their position on their membership of the U.K., the formal process of negotiating a British EEA trade agreement can begin. There is no reason for the negotiations not to run smoothly as both sides have a lot of common interests.

I predict the negotiations will last no longer than March 2019, long before the next General Election.

David Robert Worley, Wokingham Greens

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(edit) It will be completely unrealistic (practically) to vote on the terms of Brexit before or after the negotiations have begun / concluded as one side of the negotiation may disagree, resulting in an infinite number of votes on the terms of Brexit until we get it right.