The government is urged to ask if the UK can continue operating under European Economic Area (EEA) as part of European Free Trade Association (Efta) after it departs from EU
GROWING numbers of key individuals across the political spectrum are saying that the UK should join the European Free Trade Association (Efta) after Brexit.
The appeals are coming from Lord (David) Owen, a former Labour foreign secretary who supported Brexit, Liberal Democrats, long-standing euro-sceptic Christopher Booker and other Tory-supporting Telegraph commentators.
The general view of cross-party “Brexitiers” and “Remainers” is that Premier Theresa May’s “Chequers” Brexit deal proposals are unworkable and they have already been rejected by the European Union. Polls indicate that 70 per cent of the populace are dissatisfied with her negotiations.
The fear is that Mrs May will have to make further concessions which will be rejected in parliament. Alternatively, the UK will be forced to crash out the EU with no deal. Sterling has already begun to dip ahead of potential adverse financial and economic consequences for both the UK and EU.
Jersey Option?
In recent days there has been speculation in The Times that UK negotiators are seeking the so-called Jersey option. i.e. asking for a customs union with the EU and accepting its regulation of goods. Under this option, Britain would reject EU rules on financial and other services and freedom of movement. So far neither the UK government nor the EU has confirmed that the “Jersey Option” is on the table.
Efta, however, is believed to be the least worst solution for the Brexit impasse.
Norway, Switzerland, Iceland and Liechtenstein, current members of the Efta, have indicated that they would welcome the UK as a member. The Efta is an alternative trade bloc for countries outside the EU.
Iceland, Liechtenstein and Norway are also parties to the European Economic Area (EEA). With some exceptions, they adopt most EU regulations, have access to the single market and have some level of influence on future EU policy.
Switzerland is not part of the EEA, does not have access to the single market and has made its own bilateral agreements with the EU.
The nations can negotiate their own trade deals with the US, Asia and other non-EU nations.
EEA members are expected to preserve the EU’s “four freedoms” of movement: goods, services, capital and people. The free movement of people – non-UK control of immigration – has been a stumbling block.
Large numbers of working-class voters in north-east England, Midlands and Wales supported Brexit as they feared that unfettered EU immigration was overcrowding hospitals, schools and housing.
On the other hand, a sizeable number of people who voted for Brexit are in favour of the economic advantages of the European Economic Community’s common market. In any event, Mrs May has already made concessions on immigration for two years after Brexit.
“I have been trying to persuade the prime minister since Nov 23, 2016, to assert our right to stay in the EEA as a non-EU contracting party after we leave the EU,” Lord Owen wrote in the Sunday Times. “However, we should do so as part of the Efta governance pillar, not the EU pillar where the European Court and Commission hold sway.”
Lord Owen maintains that the UK government should write to the 27 other EU members and Norway, Iceland and Liechtenstein. The government should ask if the UK can continue operating under the EEA as part of the Efta after it departs from the EU. (Under the EU, the UK is already a part of the EEA).
“This would ensure no pull out, but a smooth entry into the transition period while we remain in the single market,” wrote Lord Owen.
“Clarifying the legal position over full EEA membership is urgent since it offers a third option to avoid the UK being boxed in between only a bad bespoke deal or exiting under World Trade Organisation rules.
“It is not sufficiently realised in public debate that the draft withdrawal agreement, at present, anticipates the continuation of Britain’s membership of the EEA, but with the UK in the EU pillar, where the EU institutions are sovereign.
“The UK would also be without many existing rights to participate in the relevant legislative processes. Nor would we be free to steer our own fishing and agricultural policy as the other three non-EU countries do. Furthermore, the whole situation could potentially last indefinitely.”
Lord Owen said the government should thus scrap parts of the withdrawal agreement negotiated last December, along with the commitment to pay at least £39 billion (S$68bn) to the EU. At a later stage when the UK has ironed out post-Brexit difficulties, it could give notice to Efta and the EEA. It could then seek an EU trade deal similar to the one that Canada successfully negotiated.
Several commentators contend that the EU will have to give some concessions on free movement and that a fudged deal would effectively be similar to the Efta option.
This article was first published in The Business Times, Singapore
Neil Behrmann is London correspondent of The Business Times. Jack of Diamonds his thriller on global diamond mining and smuggling, has recently been published. It is the sequel to the thriller, Trader Jack, The Story of Jack Miner.
See reviews of both books on: https://www.amazon.co.uk/Neil-Behrmann/e/B005HA9E3M