Brexit is here – and now ?: The search for a future continues

Saturday, January 16, 2021

Brexit is here – and now?
The search for a future continues

A guest contribution by Hartmut Kaelble

British entrepreneurs vent their displeasure. Bureaucracy, customs regulations, food shortages – London's supposedly "fantastic Brexit deal" with the EU does not stand up to the reality check. Just two weeks after leaving the EU, they are calling for renegotiations. What options does London have?

To make things easier for everyone, the Brexit agreement was concluded at the end of 2020. After four years of tough negotiations, Great Britain has now left the European Union. But how will EU-UK relations develop from now on?

Just two weeks after leaving the EU, British associations are shocked by the consequences. Prime Minister Boris Johnson praised the EU agreement as a "fantastic deal". The truth is different: trade barriers, additional red tape and several UK supermarket chains are already reporting difficulties in the food supply in Northern Ireland. Looking to the future from historical experience, there are five options for Great Britain and the EU:

A first – admittedly rather unlikely – option is that Great Britain will play a similar role as an innovation leader in the future as it did in the late 18th and early 19th centuries. At that time, Great Britain was the locomotive for industrialization across Europe. Despite its significant research potential, it does not look like the island will take on such a role again. The most important innovations today – unlike then – come from outside Europe, from the USA and from East Asia.

A second, similarly unlikely option is that Great Britain, as in the late 19th and first half of the 20th century, turns economically away from Europe, concentrates the main focus of its foreign trade on non-European markets and thus makes Europe an economically distant, separate, and becomes a secondary market. If this scenario were to occur, it would be a repetition of history, because until the post-war period after 1945 no other major European country was as economically intertwined with Europe as Great Britain in terms of foreign trade. A return to this state of affairs would, however, require Great Britain to regain its former markets in Africa, South Asia and East Asia, which were based on the British colonial empire. However, this is an extremely unlikely ideal for many Brexiteers.

A third option is the decline of Great Britain: the departure of Scotland and Northern Ireland from the UK and, furthermore, the split between the south of England, which would have liked to remain in the EU, and the northern part of England, which wanted to leave the EU. However, this return to the medieval division of what is now the United Kingdom is also unlikely.

The fourth option: Britain will return to the EU after ten or twenty years. The prerequisite for this would be that continental Europe once again grow economically much faster than Great Britain, as it did in the 1950s and 1960s, the Great Britain economy falls into a structural recession and Great Britain becomes a member of the EU again as a way out of this malaise. But that is also unlikely, because the continental economic boom was a very unique catching-up process after the severe crisis of World War II and Great Britain's economic malaise had a lot to do with the similarly unique decolonization and the British aftermath of World War II. It is highly unlikely that the economic growth gap between the continent and England will widen again and that membership of the EU will become an option for a large majority of Britons.

So only the fifth and most likely option remains: a close mutual relationship in economic, security and scientific terms between the continent and Great Britain, for which the treaty provides the conditions. It is completely unclear what this most promising option could look like in detail. Because for this one cannot fall back on haunting developments in history. This option will depend heavily on future EU and UK government policies.

Loss of power and disputes

It may be that other member states of the European Union want to elect such treaties with formally greater national independence than Great Britain or even Switzerland and Norway and end their membership in the EU. Then, in the worst case, the Union could shrink into a core Europe, the expansion of which is difficult to predict, or even revert to a small customs union if old core countries leave. In a new Cold War between the United States and China, Europe would again become a plaything for non-European powers, as in the historic Cold War before 1990, and the fundamental decisions about Europe would be made in centers of power outside Europe.

It is also possible that the EU will remain fully intact, but both in the UK and in the EU economic growth and economic dynamism will be disappointingly meager in a post-corona crisis. In addition, it would be possible that both partners get caught up in long-term, tough disputes over the many points that have not yet been clearly regulated in the contract, creating a lasting, but contentious relationship that is not particularly productive for both sides. A misguided EU policy could even try to use such circumstances in order to maintain the cohesion of the 27 member states of the EU. That would not be a domino-like decline of the EU, but by no means optimal.

The best development would be a close partnership and integration between Great Britain and the EU, similar to the relationship between Canada and the USA, from which mutually productive situations for economic growth, but also for political values, for science and for external security arise. There is no good historical example of this in European history either. But why shouldn't something new be possible?

How EU-UK relations will look in detail depends to a large extent on the EU's forward-looking, long-option policies, based on its core goals of cohesion, peacekeeping, economic and environmental dynamism and shared political values oriented.