domingo, 21 de fevereiro de 2016

‘Cat’s out of the bag’


Cat’s out of the bag’

Whether Britain votes In or Out, June referendum will forever change UK and EU.

By PIERRE BRIANÇON 2/22/16, 5:30 AM CET Updated 2/22/16, 6:03 AM CET

David Cameron’s four-month campaign to remain in the EU is not, as some leaders claimed after last week’s summit, now a purely domestic U.K. affair. If Britain chooses to stay, the story won’t end there. And if it goes, hold on to your hats.

Although the staged brinkmanship of the marathon two-day summit produced little in the way of technical changes to Britain’s relationship with the EU — “the sweat mattered more than the substance,” in the words of one French diplomat — the drama itself will have a long-lasting impact both on Britain and the EU, according to EU diplomats who took part in the talks. It’s likely to unsettle Britain’s relationship with Europe for years, no matter which sides carries the June 23 referendum, and to open up a fissure between euro and non-euro countries within the EU.


Isle divided

In the coming months, Prime Minister Cameron has to campaign in favor of a European Union he railed and protested so much against. He aired the British people’s doubts about the EU so eloquently — so much so, that the popular London Mayor Boris Johnson challenged Cameron to join him in campaigning for a “Brexit” — that, as one U.K. diplomat said this weekend, “Now that the cat is out of the bag, the issue will not go away.”

“Look at what happened in Scotland,” said the diplomat. “The question of independence was supposed to be settled once and for all by the September 2014 referendum. Do you seriously think it has been?”

Nicola Sturgeon’s Scottish National Party (SNP) is pro-EU and Scotland’s first minister warned on Sunday, in the same BBC program where Cameron spoke on Sunday, that a vote for Brexit would “almost certainly” trigger demands for a second Scottish vote on secession as many Scots would object to being pushed out of the EU “against their will.”

Regional differences will be exacerbated if the fight for the Tory leadership results in a takeover by Boris Johnson.

In Northern Ireland, polls suggest a majority of people favor remaining in the EU, aware perhaps of the impact on the overall Irish economy of closing the trade border with the fervently pro-EU Republic, which could also be a setback for the peace process. Wales appears to be the only devolved part of the U.K. where popular sentiment is moving in favor of a Brexit.

One of Cameron’s biggest problems, the British diplomat noted, will be England. “You could very well have a referendum where the British people decide to stay in, but still an overwhelming majority of the English [vote] in favor of leaving,” he said.

Those regional differences will be exacerbated if the fight for the Tory leadership, which is the subtext of the U.K. referendum, results in a takeover by the long-term Euroskeptic, and now declared Out campaigner, Boris Johnson. Like the Scottish independence vote, which still haunts U.K. politics despite the separatists’ defeat, the Brexit cat will remain thoroughly out of the bag if Johnson succeeds Cameron.

British PM David Cameron with European Council President Donald Tusk during the summit in Brussels

For the EU as a whole, Brexit would be a major shock. The subsequent years of negotiating the breakup, the links to entangle, the myriad of micro-problems to solve, might make the euro crisis look in retrospect like a walk in the park.

A long-standing, non-written rule of the EU was that you never put the U.K. in a minority on financial matters. That’s what may change now”
– French Treasury official.

Even if Britain opts to stay in, the year-long Brexit dramaturgy has helped reinforce in both France and Germany their conviction that the priority should now be to reinforce the eurozone and complete the reforms that have only partially addressed its long-standing structural problems.

Paris and Berlin remain far apart on the best way to do this, the timetable, and the tradeoff between financial transfers and centralized control over national fiscal policies. But they formally agree on the ultimate goals of further integration, and on the fact that this will naturally now stand higher on their priority list than trying to keep the whole of the EU together. The Brexit debate has revived talk of a two-speed Europe with the eurozone countries sitting in the fast lane.

Making the case for staying in Europe, Cameron told a BBC interviewer on Sunday that if Britain left, its “financial services could be discriminated against.” The deal he secured in Brussels on Friday will ensure the U.K. can have “the best of both worlds,” he said.

The irony is that no matter what cosmetic guarantees he thinks he obtained against the euro states ganging up on the U.K. on financial regulation if it stays in the Union, they will now be tempted to move with less regard for London’s concerns than they did before.

“A long-standing, non-written rule of the EU was that you never put the U.K. in a minority on financial matters. Just like you never did put France in the minority on agriculture”, noted a French Treasury official. “No significant piece of financial regulation was ever taken over London’s opposition. That’s what may change now.”

Which is just another way to underline that even if the U.K. stays in, it still has taken a symbolic step aside that is rife with potential, repeated problems in the years to come.

Authors:


Pierre Briançon  

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