The UK is a nation of ‘shopkeepers’, a trading nation, inside or outside the EU.

uk-eu

That great advocate of European unity, albeit at the point of his sword, Napoleon derided his English adversaries by calling them a ‘a nation of shopkeepers.’

This may not be literally true in a globalised market place where most signs on our high streets are of multinational corporations not local shopkeepers, but the UK is still primarily a trading nation.

The trading is not mostly in services and finance, with technology coming up behind, rather than widgets, but it is still a trading focus and mentality. The UK buys and sells. That’s what it does.

There is a continuing national debate in the UK over membership of the EU Internal Market. Much of the advocacy for being “in” the IM (sometimes wrongly called the Single Market) implies that the UK needs to pay for something that it previously received with no charge.

Only EU member states can be members, but many countries negotiate and pay for access to it, including Norway which is quoted most often by some people as a model for the UK.

As an EU member the UK benefited from the protectionist Internal Market bloc which makes sure that non-members pay additionally. Of course as a member state the UK paid for membership of the IM anyway through its overall contribution to the EU coffers, the second highest net payments from the 28 states.

If, or as I suspect when, the UK negotiates access to the IM it will simply be paying for something it was paying for previously anyway. It wasn’t free!

Of course most people in favour of Brexit include a free-trade future for the UK as one of the prizes of freedom from the EU. That’s fine in terms of free trading with others who also believe in free trade.

We simply revert to WTO rules. But pretty much all EU trade rules are modelled on WTO rules so the differences are marginal. The only real difference is that to trade with the EU member states the UK needs to come to agreement one way of the other with the EU as a whole.

In an increasingly protectionist and nationalist world, this will be the challenge for the UK across the world, most notably with the USA of course which is currently retreating into concrete wall protectionism and will only want deals which it sees as a one-way benefit.

The UK has a tough time ahead I suspect in getting the sort of new trading world that Brexiters, including me, dream of. It has to be acknowledged that the UK is heading in the opposite direction to most of its competitors and partners.

As we dreamed of globalisation and a frontier-less world, most big trading nations have retreated behind protectionist barriers with the EU leading the way.

This historically was why I supported the UK membership of the old EEC. I always felt that an Economic Community was a great idea. It created an Internal Market of free trade whilst building protectionist barriers against the rest of the world.

This was initially a frustration for the UK’s oldest friends in the Commonwealth. When the UK joined the EEC agriculture in New Zealand and Australia was hit hard. But they and others built new economic models from themselves, less dependent on their old Commonwealth family.

If the EEC had continued as it was pre-1992 I would still be a Remainer in terms of supporting the UK being in or out of an economic community. In Sellar & Yeatman terms it was “a good thing.”

However it all went wrong in 1992 with the creation of the European Union. A union is different from a community, and the dropping of the word “economic” sign-posted the journey towards political union.

In the past few days alone we have heard tow major announcements out of the EU confirming the strong ambition of Germany for a political union, and as Germany is now the only significant paymaster of the EU it is Germany who will call the shots, although hopefully not in the way that they have historically called the shots.

We have seen announcements of the solidification of plans for the EU army, something the French are most enthusiastic about as they have the biggest armed forces and plan to dominate it. The challenge is that the french want the Germans to pay for it.

Wise sages point out that these and other elements of political unification were all there to see in the original thinking of the founders of the Coal & Steel Community and the EEC which succeeded it.

But frankly as someone who was a member of Britain in Europe 1973-75 and of the European Movement until 1992, I did not see any of that. With the benefit of hindsight maybe I would concede the signs were there, but at the time I just saw a great new trading bloc from which UK would benefit as it emerged from a nineteenth century model to be part of a twentieth century one.

Now I look at the ideas of both the EEC and EU as being twentieth century ideas not really fit for the twenty-first century. I would have preferred to see the EEC evolve into an even more exciting trading community, building on the IM and other constructs.

Sadly this was not an option. The vision of the EU is a federalist future. That is the reason I voted for the UK to Leave, to be free of that ambition.

But I would like to see the UK not lose some of the benefits of the EEC I supported if that is possible. Interestingly most Labour and Conservative politicians seem to be at one on this.

There are those on the extremes who seem to think that the UK can go it alone in the world. I think that is a fantasy. We need trading relationships with the EU, and unfortunately that means deals on their terms probably more than ours, but seemingly a new way forward which will be worth the cost.

As in all business, the price is not the issue, it is the value bought for the price which matters most. In my old business world we used to quote the equation that value equal price divided by experience. It is the experience (in this case access to the IM) that could be good value for the price.

 

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