Posts Tagged 'Free Trade'

UKIP’s new secret electoral weapon – their own fantasy third way

Suddenly it all starts to become clear.

When The Boiling Frog wrote earlier this week about how UKIP threatens to lose any in-out referendum for the anti-EU side, he reminded readers that UKIP still does not have any plan for leaving the EU.

On the Sunday Politics, UKIP Councillor Suzanne Evans, even said to Andrew Neil in response to his question about whether the party had a roadmap to leave the EU in the event of an ‘out’ vote, ‘wouldn’t that be great?’.

But an article today in the Financial News (£) might just explain why there is no exit plan for leaving the EU… UKIP is apparently developing a carefully crafted secret weapon that would see the UK stay inside the Customs Union!  Not inside the internal market, but inside the Customs Union and negotiating its own trade agreements:

So what has changed? Why are the money-men and women being lured to the “bloke in the pub” with his Brexit rants and no policies? They are heavyweights too: Crispin Odey, who has in the past hedged his bets by giving money to Ukip and the Tories; Andrew Perloff of Panther Securities and Christopher Mills’ Harwood Capital are also donors; while Andy Brough of Schroders has signed up.

This is why – they are being persuaded that “the man in the pub” is developing a carefully crafted secret weapon to the crude In or Out stance. It is for the UK to stay within the EU’s Customs Union by negotiating its own trade agreements. Under Article 50 of the Lisbon Treaty, any country wanting to exit has two years in which to negotiate new arrangements with the Customs Union. To date, Farage has only hinted at joining a customs union. But Anglo-Sino’s [Stephen] Hill, who privately funds Tim Aker, Ukip policymaker and an MEP candidate, reckons Farage could win this election outright – and many seats at the next election – if he were to reveal that more elegant solutions are under review other than the emotive In-Out one.

If ever there was a moment that confirmed the people around Farage in the upper echelons of UKIP have absolutely no bloody idea what they are talking about, this is it. In spades. Writ large. Ignorance and incompetence on a galactic scale.

For what has been explained above by Margreta Pagano is even more of a fantasy than David Cameron’s renegotiation of powers from Brussels.  It is political and economic Neverland, demonstrating UKIP’s ‘thought leaders’ don’t even understand what a Customs Union is.  This is underlined by the rationale that is given:

Such a move, says Hill, would counter much of the nonsensical scaremongering from LibDems and Labour that pulling out would lead to the loss of millions of jobs. He has a point: if the UK were to exit but negotiate to stay in the Customs Union, UK plc would be allowed to vote on all trade matters but on an intra-governmental basis, not supranational one.

The beauty of this approach is that by staying in the Customs Union – rather than joining Efta for example – manufacturers can trade duty-free within the Customs Union area: Turkey and Monaco have Customs Union agreements. And the UK has a strong hand to play: the EU exports twice as much in finished goods to the UK as we do to the EU – mainly Germany’s car giants, BMW and Mercedes.

This is utter dreamland.  This is a fantasy third way, supposedly not in, supposedly out, but still completely under EU control as today.  If the UK exits the EU, it leaves the Customs Union.  If it negotiates to stay in the Customs Union then it is by default in the EU. Anything votes on trade matters on an ‘intra-governmental’ basis means internal… to the EU.  This Tim Aker plan is cream cheese moon stuff.  It is the world of barking cats.

A Customs Union is by definition a supranational entity because decion making is centralised and the ability of member states to strike independent trade deals is removed.  One only needs to look at Turkey – out of the EU but in the Customs Union, where the decisions on trade agreements and tariffs are made in Brussels and handed down to Ankara to implement.  That is not independence.  In the Customs Union the trade deals and common tariffs are negotiated and struck by the EU on behalf of all member states and all member states have to apply them.  That is where we already are today.

Vote UKIP for a brighter new yesterday is a phrase that becomes more accurate by the day.

There is no way a member state can go off and sign its own deals because all other member states in the Customs Union have to agree with it and adopt it.  Anything else would mean there is no Customs Union at all – in effect the EU would be bringing itself to an end.  Like that’s going to happen.  Any legal matters in the Customs Union get resolved at the European level in Luxembourg, and under this staggeringly idiotic plan that would have to remain the same, which means the UK courts would not become supreme.

Following this plan, UKIP would be contradicting its own long stated aim for the UK to be outward looking and able to strike its own trade deals with other countries around the world on our own terms. It would be tearing up the notion of UK courts being the sole arbeiter of UK related matters.  Its promises on immigration, to stop the free movement of people, could never be delivered.  It would consign the UK to maintaining the status quo of trade agreements and tariffs being set for us rather than by us.

In short, if UKIP were to adopt this as policy then forget Nick Clegg and the Liberal Democrats, UKIP would be the party of in.  Their fantasy third way is delusional rubbish.  And to think, UKIPpers look up to these idiots, laud them and declare I should be supporting and assisting them.

Nigel Farage told John Humphrys on Radio 4’s Today programme that he would do a deal with the devil to get an EU referendum. Why bother when UKIP is considering a plan that keeps the UK in the EU while only pretending to be independent?  This isn’t a case of good ol’ Nige not doing some detail, this is a case of failing to understand the basics.

A policy of ‘out’ that really means ‘in’ should defy belief.  But this is UKIP and no amount of crass stupidity should surprise anyone any longer.  If you plan to vote UKIP because you want to leave the EU, you may want to think again.

More evidence that Cameron lied about Norway and Switzerland

The europhile narrative when it comes to Iceland, Liechtenstein, Norway and Switzerland – the European Free Trade Association (EFTA) members of the European Economic Area (EEA) –  is that they are obliged to adopt all EU legislation related to the single market.  The stated exceptions are in matters of agriculture and fisheries.

Indeed, as we have seen recently seen David Cameron say of Norway and Switzerland’s position (blindly accepted and repeated by organisations that take their lead from Conservative Central Office):

[...] basically you have to obey all the rules of the single market but you don’t have a say over what they are.

So, poking around various websites, it was very interesting to come across this information published in mid-December on europolitics.info concerning the assessesment of relations between the EU and the EFTA states by the European Council:

The EEA agreement “has proven to be effective and in the interest of all,” state the draft conclusions by the 27, which nevertheless regret that Liechtenstein, Norway and Iceland have not yet incorporated into their national laws a “large number” of legal acts adopted in the EU. The homogeneity of the internal market and its “credibility” depend on their doing so, notes the text.

You can read the full report that spawned the article here.  The full text of the article is at the bottom of this post.

It seems the ‘obligation’ to adopt all EU legislation relating to the single market is nothing of the sort and the EFTA countries continue to enjoy autonomy, much to the chagrin of the EU.  It is worth noting that Switzerland comes in for a hammering in the assessment from the Council, for having the temerity to act in its own interests and not adopt evolving EU law and the various mechanisms (surveillance, judicial control and dispute settlement) that the EU says guarantee “homogeneous interpretation and application” of the internal market rules in the EU.

That being the case and the fact the UK was party to the drafting of the Council assessment, it demonstrates ever more clearly the deceitful nature of Cameron’s false assertions.  Perhaps Cameron’s quote would be accurate if he had said; ‘basically the EU wants EFTA countries to obey all the rules of the single market they have had a hand in shaping, but they can and do sometimes refuse to adopt them leaving the 27 reduced to threatening, cajoling and bullying in the hope they finally cave in’.

Full Text of article

Good marks for EEA, bad marks for Berne
By Tanguy Verhoosel | Tuesday 18 December 2012

Liechtenstein: good. Norway and Iceland: average. Switzerland: unsatisfactory.

These are the very contrasting marks the 27 will be giving to the four European Free Trade Agreement (EFTA) countries, on 20 December (1). Every two years, the Council assesses relations between the EU and the EFTA states. The three – Liechtenstein, Norway and Iceland – that are members of the European Economic Area (EEA) earn the highest marks.

The EEA agreement “has proven to be effective and in the interest of all,” state the draft conclusions by the 27, which nevertheless regret that Liechtenstein, Norway and Iceland have not yet incorporated into their national laws a “large number” of legal acts adopted in the EU. The homogeneity of the internal market and its “credibility” depend on their doing so, notes the text.

Individually, the Union praises Liechtenstein, whose “political determination” and “significant administrative efforts” are seen as exemplary. The principality can be considered a “reference” for other countries of small territorial size – Andorra, San Marino and Monaco – with which the Union wishes to intensify its relations.

CRITICISMS OF ICELAND
The 27 particularly applaud the steps taken by Vaduz to step up the fight against tax fraud and evasion. The spirit of “solidarity” shown by the people of Liechtenstein through their financial support for new EU member states to 2014 is also appreciated.

The compliment is also valid for Norway and Iceland, which nonetheless receive lower marks than Liechtenstein.
Norway and the EU have developed successful cooperation in recent years in a number of sectors – Norway’s contribution of more than €7 billion to the International Monetary Fund (IMF) in the context of the economic crisis, police and judicial cooperation, foreign and security policy, fisheries and energy – note the EU conclusions.

On trade, however, the Council “regrets” that Norway has decided to make use of the World Trade Organisation (WTO) dispute settlement proceedings against EU measures on trade in seal products and that it has raised customs duties on certain agricultural products.

Certain criticisms are also addressed to Iceland, held at least partially responsible for the failed negotiations with the EU on joint management of mackerel stocks.

The Council applauds Reykjavik’s measures to stabilise its economy following the bank sector crash in 2008. However, it notes “remaining weaknesses” in the financial services sector and adds that certain economic issues, including capital controls, still need to be addressed.

SWITZERLAND: STALEMATE
The biggest problem for the EU is Switzerland (see Europolitics 4534 and 4548).
The 27 reiterate their determination to develop their relations with Switzerland. However, the negotiations launched by the two partners on further Swiss participation in the internal market “have been marked by a stalemate” for years and are not likely to advance until the institutional issues highlighted by the Union since 2008 have been “solved”. These concern adaptation of agreements with Switzerland to evolving EU law and the introduction of various mechanisms (surveillance, judicial control and dispute settlement) to guarantee “homogeneous interpretation and application” of the internal market rules in the EU.

Switzerland presented proposals in this respect in June, but Berne needs to take “further steps” to achieve this objective, from which the EU will not turn away. Switzerland is not engaging solely in a bilateral relationship with the Union; it has become a “participant in a multilateral project”.

For the 27, this justifies the creation of a “legally binding mechanism” on incorporation of the acquisand “international mechanisms” for surveillance and judicial control, similar to what exists in the EEA.

“Exploratory discussions” in this context will continue – Swiss State Secretary for Foreign Affairs Yves Rossier is expected in Brussels on 29 January 2013 – before the possible opening of formal negotiations.

The 27 also denounce certain Swiss measures “that are not compatible with the provisions and the spirit” of the agreement on the free movement of persons. They urge Switzerland, among other things, to reconsider its decision to limit access to its labour market for nationals of Central and Eastern European EU member states.

On business taxation, the Union remains “deeply concerned” about certain canton-level tax regimes (favourable to holding companies, domiciliary companies and joint enterprises) that create “an unacceptable distortion of competition” in Europe. The Council calls for their “abolition”.

Although “progress” has been made in the ongoing “dialogue” between the Commission and Berne, the conclusions state that Switzerland remains reluctant to take all the EU’s concerns, which also relate to certain federal tax regimes, into account.

Foreign policy represents another point of friction.

The 27 welcome Switzerland’s participation in several EU missions, but regret that it has not “fully aligned itself” with EU sanctions against Iran. Reading between the lines, the Council suggest that its refusal to impose an embargo on Iranian oil products dictated first and foremost by its determination to protect the many trading companies based in Geneva.

The 27 also highlight the need for an additional Swiss financial contribution to the reduction of economic and social disparities in the Union. This is only fair since Switzerland has been granted access to this “enlarged internal market”.
To date, Berne has contributed around €1 billion to the ten Cental and Eastern countries that joined the EU in 2004 and 2007. The Council “reaffirms” its expectation that “this expression of solidarity, which underpins the relations between the EU and Switzerland, will be extended” to Croatia, as a start. The Commission has been given negotiating directives in this framework.

The Union remains “deeply concerned” about certain canton-level tax regimes in Switzerland

(1) The draft conclusions are available at http://www.europolitics.info > Search = 327164


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