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David Cameron’s Euro vision: would he dare abandon the EU?

David Cameron will outline his vision for Britain’s place in the European Union next week. Would he dare signal a split? It would be a disaster for a still-faltering economy, says EU researcher Keshia Jacotine.

British Prime Minister David Cameron was due to deliver his much anticipated speech on the future of Britain’s relationship with the European Union next week. Overnight he cancelled to focus on the Algerian hostage crisis. But the reshaping of European politics will wait for no one.

Frictions began once Germany signalled it wanted a review of the Lisbon Treaty; if a review was to occur member states would have the opportunity to renegotiate the terms. Cameron was set to seize the opportunity with a reportedly “definitive” speech on the future of British-EU relations.

Most thought Cameron would state the Conservative manifesto on Europe: major treaty revisions would be used as an opportunity to push forward new eurozone governance agreements to repatriate decision-making powers back to Britain. There was also talk Cameron would have suggested that any “new settlement” in which powers may be repatriated should be put to the British voters in a referendum.

What Cameron and the Tories didn’t bank on was the possibility of the Germans walking away before the negotiations even began. Last week, news emerged that German Chancellor Angela Merkel had given up on the idea of revising the Lisbon agreement.

Before last week’s revelation, it appeared Cameron was almost pandering to Euro-scepticism within his own party and the far Right in the form of the UK Independence Party. His Chancellor George Osborne even made it clear Britain was willing to exit the EU if negotiations didn’t go their way. The threat was strong enough to elicit comment from Germany, as well as from the United States.

The Germans criticised Cameron for effectively blackmailing the EU and warned of the potential economic disaster that would await a British exit. While Euro-sceptics have pointed to Switzerland and Norway as examples of western European countries that have flourished without EU membership, the reality remains that in the current economic climate it is hard to compare Britain with one country that is rich with natural resources and another renowned for the security and secrecy of its banking and financial sector.

And with a long road to recovery ahead, an EU exit would be disastrous for the British economy. Britain could potentially lose access to a single market of over 500 million people as well as disrupt existing multiple bilateral agreements, cost jobs and put Britain’s economic recovery at risk. Deputy Prime Minister Nick Clegg warned that even discussion of exiting the EU could discourage businesses from investing in the UK by adding a degree of uncertainty as an exit take several years.

And Cameron has received a warning from the Obama administration suggesting that while it was up to Britain to define its relationship with the EU, it’s in the interests of the “special relationship” that a “strong British voice” remains within an “outward looking European Union”.

It’s hard not to view Cameron’s strategy as a cynical ploy to ride out a current wave of Euro-sceptism that has arisen from the ongoing eurozone crisis. Cameron might also be heartened from his walk out of negotiations on the Fiscal Compact last January.

Perhaps rather than accusations of blackmail, Brussels could just call Cameron’s bluff — without treaty negotiations in place, Cameron’s strategy appears far more provocative and unrealistic. It remains to be seen how Britain can prosper outside the EU, or why a referendum is necessary without the opportunity to actually negotiate the repatriation of powers back to the UK.

There’ll never be a “right” time for Britain to seriously contemplate an exit from the EU. The eurozone crisis may have exposed the weaknesses of EU legislation and policy, with a greater need for revision and review, but with Britain’s economic recovery at stake Cameron would be foolish to proceed without a solid exit strategy or even the support of other member states on negotiating the repatriation of powers. What once seemed like Cameron’s defining moment could now just be a sheepish footnote in the story of British-EU relations.

*Keshia Jacotine is an Australian-based researcher and writer focusing on international relations and the European Union

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  • 1
    Doug
    Posted Friday, 18 January 2013 at 2:02 pm | Permalink

    All of which also ignores the potential for serious conflict in relation to the upcoming Scottish Independence referendum. Most Scots are actually quite happy about the EU, and the political parties there don’t have to outflank the UKIP. In the meantime; the irony is that the anti-Independence campaign - coordinated by all three major parties, Labour, Conservative and Liberal, have been pushing scare stories in the Scottish media about an Independent Scotland being expelled from the EU, at exactly the same time they are running the ‘we need to redefine the relationship’ line in England.

  • 2
    Malcolm Street
    Posted Friday, 18 January 2013 at 2:54 pm | Permalink

    Doug - how on earth would an independent Scotland be in danger of being expelled from the EU? I would have thought it would be a natural for EU membership and Scotland has historically closer links with Europe than England.

  • 3
    Posted Friday, 18 January 2013 at 4:32 pm | Permalink

    I don’t see how Cameron can seek ‘new eurozone governance agreements’ since the UK is not a member of the eurozone. Indeed, I suggest that the central issue for the UK is how and when eurozone fiscal policy and governance may be strengthened to allow the UK to join the euro.

    Surely if the Tory maddies somehow manoeuvered the UK out of the European Union Scotland would leave the UK to join the EU.

  • 4
    Doug
    Posted Friday, 18 January 2013 at 5:53 pm | Permalink

    The argument is that Scotland is a member of the EU by dint of the UK membership, and that if Scotland was no longer part of the UK, would lose it’s EU membership. This ignores the broader question of how could the rest of the UK retain membership as it would no longer exist, (being an entity created by the joining of the parliaments by treaty) leaving that aside, there are serious concerns especially in Spain, that any EU agreement to the joining of a new ‘separatist’ state would encourage Catalonian separatists. And the Catch 22 is that the EU has stated it cannot give advice on the possible future of Scotland unless the advice is requested by the member state, i.e. the UK, and so far, the Westminster Govt has refused to ask for the advice (presumably so they won’t run the risk of getting advice they dislike, and secondly, so they can continue to run a scare campaign about the ‘uncertainties’ of Scotland’s future).

    Now personally, I don’t see this as being a huge issue. The Spanish and Portugese fishing fleets depend on Scotland’s territorial waters, and as a major producer - I would have thought the EU would be very happy to renegotiate Scotland’s membership.

  • 5
    AR
    Posted Friday, 18 January 2013 at 6:40 pm | Permalink

    Bring back EFTA, although it never went away - still exists in aetiolated form Norway, Switzerland, Lichtenstein, Luxemburg the usual suspects.
    It is a natural fit, the small independent nations, beholden to none and ignored by most, Oz would be welcomed in, similar to the olde worlde ‘Empire Preference’.

  • 6
    Malcolm Street
    Posted Saturday, 19 January 2013 at 7:18 pm | Permalink

    Gavin - my thinking too - if the UK leaves the EU the option of Scotland leaving the UK and joining the EU looks attractive to Scots… After all, if the UK can leave a super-national body, why can’t the Scots?

    Doug - I see distinct parallels between the situations in Scotland and Catalona. I wouldn’t be surprised if Catalona moves first.

  • 7
    Doug
    Posted Saturday, 19 January 2013 at 9:10 pm | Permalink

    There are some parallels between Catalonia and the Scots, but some distinct differences as well. Mainly that the Supra-National body (in this case the UK) was formed with consent, and there is consent to a democratic process if the body is dissolved.

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