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Did Brexit Officially Come at the Wrong Time?

Martin Castilla            No comments            Jan, 26

The economic relationship between the EU and the USA was strained under the previous administration, but for the UK in particular, Brexit perhaps came at a time when these EU-US relations might be under consideration for repair. Thus it is not surprising that the EU27, the 27 EU member states which will adopt the final decision on the future of EU-US trade, has been quick to point out that the United States can only be referred to as a ‘real friend’ if it is a ‘real partner’. This has become rather a ‘delegation’ statement with a subtle diplomatic warning.

On 18 October 2016, the European Commission published the final trade agreement (the Bilateral Investment Treaty) it has negotiated with the USA, which is signed by the United States and the EU. The document’s provisions are extensive and cover a wide range of products and areas, such as intellectual property, competition policy, government procurement, social and environmental standards, services trade and the setting up of courts and tribunals to resolve disputes. The mutual recognition of qualifications and the procedures for the application of trade agreements are also included.

Whether or not you are a fan of the EU, its internal politics, or indeed the domestic policy agenda of either the USA or EU27, it is difficult to disagree that in economic terms there is nothing in this document which makes for a brighter future than the one that is offered in the Transatlantic Trade and Investment Partnership (TTIP). The fact that Trump, the newly-installed president, opposes these agreements, particularly the TTIP, only serves to bring these agreements into sharper focus. This does not mean that the EU should give up, but it might be the time to consider why so many of its member states are so keen to pursue an agreement which appears likely to lead to both damage and friction.

The issue is not so much that Trump, Clinton and the rest of the world can’t see this, or that there are people in this and similar positions who are blind to the realities of what is being offered. If there are serious people in this world who are not willing to consider the prospect that there could be a better option out there, we should respect their position, and not pretend to be surprised by their behaviour. The problem is that there are political forces and communities around Europe who are probably more interested in satisfying an ideological demand for reducing globalisation, even if it hurts their domestic economies, than they are in producing an analysis which might undermine the position of an ideological opponent.

For this reason it is interesting to see how much attention was paid in the TTIP negotiations to whether or not European countries could sign an agreement which was not wholly in the EU’s interests. If the conditions in which the EU operates are well established, and the EU’s power and influence is credible, why would a small country, such as Canada or Australia, with minimal trade with the USA, be under any obligation to include its interests in the agreements which determine the internal and external borders of the EU? That might be a debate worth having, but it is unlikely to be open to serious discussion until the European Commission fails to take the initiative and does so itself.