The new organization advocating a ‘leave’ vote in the UK’s referendum on its EU membership has launched a website with a series of FAQs, which will rapidly give itself a reputation for factual errors and disinformation. Michael Emerson provides examples.
Michael Emerson is Associate Senior Research Fellow at the Centre for European Policy Studies and former EU Ambassador to Moscow.
No. 9. What would the impact on trade be?
A replacement trade deal with the EU, covering at least 90% of trade is a certainty.
But what kind of deal should be expected? The EU would only agree to continued full market access if the UK continued to apply EU product standards for health and safety, and EU standards for prudential regulation for financial services, which overall accounts for large majority of EU regulations (see further below under Question 17). These conditions are currently met by the non-member states of the European Economic Area such as Norway. If these conditions are not met, or are the subject of big uncertainties, there will be a major downgrading of the UK as a location for foreign direct investment (FDI) that assumes access to the entire EU market. Moreover the UK is especially vulnerable to this risk, since it is more dependent on FDI motivated by the EU market than any other EU country. As to the political aspects of the Norwegian option, their prime minister said recently, “if you want to help run the EU stay in, if you want to be run by the EU join us in the EEA”.
As a country that traditionally embraces trade, the UK could add a range of other emerging markets such as China, Indonesia and the UAE – again ones that the EU is yet to agree terms with – and offer the UK businesses a real competitive advantage over their rivals in mainland Europe and beyond.
Look at the proposition of free trade with China a bit more closely. The UK already imported in 2014 2.5 times as much from China as its exports. If it went ahead with zero-tariff trade with China ahead of the EU, industries of the UK could be decimated. And outside the EU, China would hardly invest in the UK as a base for the bigger EU market.
No. 13. What will happen to British citizens working in the EU, and EU citizens working in the UK?
The EU would be obliged to grant permanent settlement rights to Britons living in Ireland and mainland Europe. The UK would do the same.
The story would be much more complicated. For example British retired people in Spain pay nothing for health care, since under EU law cooperation between social security systems the NHS simply reimburses Spain for these expenses. However this law would cease to apply to the UK, which would have to negotiate a new agreement. If then the UK was itself at the same time both restricting intra-EU migration and the social benefits for such immigrants, then the context for negotiating continued favorable terms for UK resident in the EU would be very negative.
No. 14. Will I still be able to travel throughout the EU freely?
Because all mainland EU members are part of the Schengen passport union, UK citizens would continue to enjoy unfettered access across the continent, once they had cleared passport control in the first country they arrived in. We would have similar easy access arrangements that Switzerland has (they are not an EU member either). Given how dependent the rest of Europe is on British business travel and tourism, a question of visas should not arise.
The idea of similar arrangements as Switzerland, and that the question of visas would not arise, is false or dubious on several accounts. First, Switzerland is part of the Schengen area, whereas the UK is not. Second, Switzerland has recently voted in a referendum to restrict immigration for the EU, and this leads to retaliation by the EU. The Swiss measures are not yet in force, and the government scrambling to find damage limitation solutions, before the costs for its interests become too high. Thirdly, if the UK went ahead to impose quantitative restrictions or a ‘points’ system on immigration from the EU as for non-European countries, it might well have to introduce as an implementing tool visas or other bureaucratic procedures for EU citizens as it does for non-Europeans; if it did this the EU would reciprocate by imposing visas or other bureaucratic procedures such as work permits on UK citizens. This would be a huge retrograde step, which suggests that the advocates of such restrictions on immigration from the EU have not thought through its consequences.
No. 17. Would Britain’s legal system change?
The predominant change would be that Brussels would no longer have direct say over UK law. The UK may continue to adopt international product standards to help UK exporters reach foreign markets, but the volume of these rules would be miniscule compared to the thousands of EU rules the UK is required to adopt.
The large majority of EU rules are those governing health and safety standards of industrial and food products for consumers and workers, of which about one quarter are international (ISO) standards, these being usually copy-and-paste identical to EU ones. For the many thousand of other standards that warrant the CE certificate of conformity for trade within the EU, it is inconceivable that the UK would find it profitable to go about redefining them (to be less safe?). This is because the EU regulations, since the pioneering work of Lord Cockfield (as Mrs Thatcher’s nominee to the Commission) created the so-called ‘new approach’, which only defined the essential features of product safety, leaving it to industry to work together in specialist organisations to define the thousand of precise implementing standards. However, and this is the essential point that the above text overlooks, these precise implementing standards are voluntary in the sense that individual producers who can engineer their own standards can do so freely as long as they can prove they meet the essential requirements for safety. So export-oriented UK industries will carry on using the EU standards to win the CE mark, except that they are already free to adopt their own standards where they think they can meet essential safety standards less expensively. The text is thus doubly incorrect: the number of remaining EU rules would not be ‘miniscule’, yet if the UK tried to eliminate many thousands of them it would be cutting itself off from its biggest market.
No. 18. Would Britain have less influence in the World?
No. We would have more. Currently on many of the most important global trade bodies, such as the World Trade Organisation, we do not have a seat as we have to rely on the EU to represent us. If we leave the EU, we will regain our own seat at the top table on this and many other important global organisations.
Actually the UK is a member of the WTO in Geneva, while common positions of the EU to which the UK contributes are presented by the EU representative. However there do not exist any other ‘most important global trade bodies’. More seriously mistaken is the argument that the UK would regain ‘our own seat at the top table in ‘many other important global organisations’. This is simply untrue, since the UK is a full member in its own right in the IMF, World Bank and the entire UN system, including the UN Security Council and the many UN agencies. However the UK’s privileged status as one of the five Permanent Members of the Security Council would come under increasing criticism as over-representing a single middle-sized country that would not even informally be representing the EU, which France would then do exclusively. As to being more or less influential in the world President Obama has been very clear, that the US values the UK as a strong ally in a strong EU, and deplores the prospect of its secession.
And now the question that ‘Leave.EU’ did not ask: Would UK secession from the EU lead to disintegration of the UK itself with Scotland’s secession?