Britain’s long-standing relationship with the European Union has recently come under a lot of media spotlight. The issue? Whether or not Britain should remain part of one of most advanced and intricate examples of regional economic union. January 23rd saw David Cameron give a speech at the London headquarters of Bloomberg discussing Britain’s relationship and his administration’s stance on the European Union. He discusses the idea that a referendum is required to offer a final answer to the ‘in-out’ debate that has surrounded Britain and the EU.
Cameron also goes on to say that Britain must be a part of a reformed EU rather than leave and be on the outskirts. This kind of discussion will prompt big businesses to rethink their strategy and this was the case as Carlos Ghosn, Nissan chief executive, said that Nissan would have to reconsider their position in Britain if they were to exit the EU. It comes as no surprise as having access to the single market is one of the biggest reasons to set up operations anywhere in the EU.
This report discusses Cameron’s speech and looks at Ghosn’s comments and takes you through several key concepts and ideas surrounding Britain’s relationship with the EU. Summary and critique Cameron speech at Bloomberg headquarters On Wednesday 23rd January, David Cameron delivered a speech on his opinion of the UK’s relationship with Europe, assuring a referendum on the country’s EU membership given that the conservative party win the next election.
In a surprisingly more pro-European speech than expected, Cameron argued that there are strong reasons to support a renegotiation of the UK’s position inside the EU and that a referendum on this new deal could help get British people feel more involved with Europe. Such a referendum, despite its good intentions, would need to be planned well to ensure success. By getting as many of the electorate as possible to get involved and vote would be the biggest challenge but by clearly explaining the options they have it could result in a resounding success for Cameron both within and among his electorate and Europe as well as his backbenchers.
Cameron emphasizes Britain’s need to remain a single entity without compromising their involvement, economically speaking, in the EU. He stresses that Britain must remain a European power but does point out that the EU must become less centralized and more intergovernmental. Many made an initial accusation of ‘cherry picking’ and it does make sense. Cameron has clearly called for abandonment of the ‘ever closer union’ clause that is in the preamble to the Treaty of Rome yet maintains that the economic relationships built through the EU should remain, develop and strengthen.
At most this a basic case of picking and choosing on the part of Cameron, but criticisms are warranted as two French cabinet ministers aptly accused Cameron of treating Europe like an “a la carte” menu . Carlos Ghosn comments Nissan chief executive, Carlos Ghosn, has contributed to the same conversation in his own way. Expressing that Nissan would have to reconsider its investment in the UK if they were to separate from the EU, Ghosn alludes to an ultimatum for Cameron and all concerned. Their plant in Sunderland employs 6,500 workers and is a key part of Nissan’s infrastructure in Europe, “Sunderland is a European plant, based in the UK” .
His general tone in the interview from which this article has been formed does see this option as one that isn’t the most probable, but it highlights the difficulty in the decision that has to be made by the UK. Cameron is no fool and knows that such considerations have to be made but this article highlights the ability that companies within the UK have in affecting the decision making process. Nissan are clearly aware of the implications of taking these jobs away from the UK electorate on the coalition government. However to move such an operation to another country is a lot easier said than done, Ghosn concedes.
So does Cameron have much to fear? In part yes, and in part no as it all depends on the agreements made if the UK decide to leave the EU. If somehow the UK can negotiate a deal, similar to that of Norway, where they can take advantage of the EEA benefits while remaining separate to the EU in other arenas, then companies such as Nissan will definitely be staying put. Critical analysis Britain’s options Many Eurosceptics maintain that leaving the EU does not have to mean the end of the UK’s access to the common market. This line of thought has its place but looking at the options faced by Britain, it doesn’t look great.
First is the option of joining the European Free Trade Association, as members, through the European Economic Area agreement, are able to participate in the EU internal market. The EFTA is a group of countries that have access to the EEA but are not included in European Commission proceedings . The second option is to join the European Economic Area, which brings together the EU Member States, and the three ‘EEA EFTA States’ into an Internal Market administrated by the same basic rules. Advocates for such an argument highlight the success of Norway and Switzerland who have done very well for themselves through this method.
But that is where Eurosceptics fall into a trap. As much as these two nations have enjoyed success, Britain is not comparable to these two nations. The UK itself does not have as much to offer in that Norway is oil-rich which realist thinking, chiefly self-interest, would dictate the EU must form alliances with them. Switzerland on the other hand is only part of the EFTA but the reason they are able to operate so successfully outside of the EU is because the nation is a tax haven, meaning investment is always likely to go there regardless.
Furthermore when looking at EEA and EFTA contributions that would have to be paid it is apparent that the UK would have a bad deal. All members contribute to the EU proportionate to their economies as part of the EEA agreement so Britain will have to pay towards the EU yet have no say at all in EU laws and regulations that the UK would still have to follow . Cameron, a well-known soft-Eurosceptic, does say that such a method would not be the best approach for the UK and urges that having a “leading role within a reformed EU” is the best way forward. It remains to be seen, however, what his backbenchers and party seem to think.
Carlos Ghosn’s comments on the matter will prove to be a sign of things to come if such euroscepticism continues to prevail. From a purely business perspective the single market is too much of an asset. A House of Lords EU Committee found that 78% of business leaders found that the single market was helpful to business because the option of leaving would simply not offer them the same opportunities to trade and sell . Therefore maintaining access to that market is both critical and pragmatic. Intergovernmentalism New areas of EU activity have recently seen a new form of decision-making on the part of the EU, that of Intergovernmentalism.
This is the basic reality that “the most senior representatives of the member states argue it out and collectively determine what the EU does next. ” . The supranational approach that this Intergovernmentalism offers has been missing from many years of regional political activity. Such a forum for discussion of real issues is a sign of real intergovernmental coordination and is something Cameron agrees with, “It is national parliaments, which are, and will remain, the true source of real democratic legitimacy and accountability in the EU”. Sovereignty and democracy
Cameron also argues for less centralization and in light of recent calls for a European Finance Minister, with far-reaching power over economic issues, Cameron could be argued to be correct. Increasing centralization and having people put in charge of, for example, finance on such a large scale would completely disregard issues of national sovereignty and democracy. How can someone from Brussels dictate policy in the UK? Being the main criticism. Furthermore the elected governments are there through legitimate democracy and so their administrations can take care of these issues with greater legitimacy than a EU commissioner ever could.
It has long been argued that the EU suffers from a serious democratic deficit and this has formed a large part of euroscepticism especially in arguing against a political union. “There is no pan-European or public sphere” meaning that it is almost impossible to call upon a people as European. Another important issue is that people will feel left out as people already argue that their individual vote means nothing domestically; if the electorate included all the member state’s populations individuals will feel even more detached. Also there are already poor turnouts for EU parliamentary elections within the UK, standing at 34.
48% in 2009 . This already apathetic view towards European politics would have to change if any kind of political union is to be made. Bibliography Bellamy, R. (2012). The inevitability of a democratic deficit. In H. Zimmerman, & A. Dur (Eds. ), Key Controversies In European Integration (pp. 64-71). Basingstoke: Palgrave Macmillan. Brown, S. a. (2013, January 23). Selfish, ignorant, dangerous: Europe’s verdict on Cameron speech. Retrieved December 5, 2013 from www. reuters. com: http://www. reuters. com/article/2013/01/23/us-britain-europe-reaction-idUSBRE90M0MY20130123 Business For New Europe. (2006, December 21).
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