Brexit opportunity for Europe

THERE is much talk about a potential exit of the UK from the European Union (EU), which will be decided by British citizens through a referendum in June. There are a number of unanswered questions over how this may affect Europe-Africa relations.

The latest polls indicate a neck-and-neck battle, with voters divided on the issue in roughly equal percentages. Politicians are split between those wanting to stay in Europe provided that Britain’s special status is preserved, and those who call for a unilateral exit regardless of the conditions offered. Only a minority believes in the intrinsic value of a united continent. This is perhaps not surprising for a country that has never been enthusiastic about the European integration project.

Britain was not among the first six nations that joined forces in the postwar period. It actually sabotaged Europe’s founding treaty in 1957, proposing an alternative free trade area with no ambition to reach political integration. Once it realised its mistake, it applied for membership of the newly constituted European Economic Community, but then French president Charles de Gaulle, a notorious Anglophobe, vetoed its accession for as long as he remained in power.

In the mid-1970s, when the country was finally accepted into the European family, new demands were put forth by Westminster. Within a year of membership, it expected exceptions in monetary governance, agricultural policy and budget contributions. In the 1980s, Margaret Thatcher threatened to leave Europe if the UK’s payments to the community were not reduced: “I want my money back,” she shouted.

Her successor, John Major, opted out of various sections of the 1992 Maastricht Treaty, which formally created the EU. In particular, his government opposed the plan for a common currency and the “social chapter” on workers’ rights. Britain also rejected the Schengen agreement on free movement of people, despite the fact that even non-EU nations such as Norway, Switzerland and Iceland joined the initiative with a view to supporting human mobility as a fundamental right within the European geographical area.

After the 9/11 terrorist attacks, the British government aligned with the US in the war on terror and launched the military invasion of Iraq without a United Nations mandate. Not only did this violate international law, it also triggered new frictions with the EU, whose diplomatic strategy was hampered by Britain’s militaristic approach. As if the wars it had waged had nothing to do with the ensuing humanitarian catastrophes, the UK then turned its back on the rest of Europe during the refugee crisis.

Throughout the past 40 years, Britain has actively carved out a special place in Europe, with strong isolationist tendencies and a very conservative stance on many crucial areas, from social development to environmental policy. It has traditionally opposed attempts at tackling inequality by regulating the economy, in particular financial markets. Earlier this year, Prime Minister David Cameron secured another special deal from the EU, which included a permanent opt-out from the euro and exclusion from the banking union project, an initiative devised after the financial crisis.

Most importantly, Britain has used all its influence to ensure much-needed financial regulations in Europe are either dropped or watered down. For instance, the plan to establish a financial transaction tax, which was tabled in December by 10 leading EU members, has been fiercely opposed by the UK government, with Chancellor of the Exchequer George Osborne threatening to go to court if the proposal is accepted.

Cameron and his colleagues have also gone all-out to defend the City of London — the largest financial hub in Europe — from any regulatory interference emanating from Brussels. Moreover, the Bank of England has refused to comply with the European Banking Authority’s new regulations in terms of bonus caps for bankers, even though the EU rules apply rather liberal margins, including bonuses of up to 200% of annual salary.

The country took the European Central Bank to court over its attempt to control London-based clearing houses, with a view to retaining most transactions, even in euro-denominated trades within the City, away from Europe’s regulatory capacity.

Read full article here

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