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1/ In two new policy briefs, co-written with my colleagues @elvirefabry and @eulaliarubio, we study the ongoing negotiations for a new EU-UK economic relationship and their possible outcomes through the lens of differentiated integration. @delorsinstitute @IdeaEu @epc_eu Thread:
2/ In the first publication (with @elvirefabry), we discuss how any new EU-UK partnership will have to fit into the broader ecosystem of external differentiated integration, consisting of different forms of third country access to the Single Market. https://twitter.com/DelorsInstitute/status/1275730672741748736
3/ Our brief shows how the experience with different forms of external differentiated integration (EEA, EU-CH bilateral agreements, EU Customs Union(s), comprehensive FTAs, etc.) has led the EU to renegotiate them in recent years.
4/ The EU has aimed to create unified institutional frameworks, establish dynamic alignment with the EU acquis, and reinforce dispute settlement mechanisms with a role for the European Court of Justice in interpreting EU law.
5/ Brexit has further hardened the EU’s stance towards other third countries to avoid British ‘cherry-picking’ based on existing precedent.
6/ Existing forms of external Single Market access also considerably constrain the leeway for the EU to make concessions to the UK if it does want to risk an unraveling of the economic relationships with countries like Norway and Switzerland.
7/ In this environment, it is unlikely that the EU will give large concessions to the UK. It will not abandon the leverage of Single Market access to ensure a level playing field with its close trading partners in favour of an ‘unbalanced’ agreement with the UK.
8/ In the second publication (with @eulaliarubio), we develop two possible scenarios of a future EU-UK economic relationship to study their potential impacts in terms of effectiveness and EU political unity. @IdeaEu https://twitter.com/IdeaEu/status/1273905861702926337
9/ The first scenario (closer cooperation) is similar to the new but still unratified EU-CH agreement. The second scenario (looser cooperation) mirrors recent FTAs with countries such as Canada or Japan.
10/ We find that the scenario of closer cooperation is superior in its capacity to minimize economic harm both for the UK and the EU, and to provide a climate for long-term economic cooperation.
11/ Concerning political unity, we argue that the biggest threat would be an ‘unbalanced’ agreement in terms of advantages and obligations. This could spark differentiation desires among EU MS and trigger third-country demands to renegotiate their partnerships with the Union.
12/ Some take-aways from all this: The EU is likely to avoid major concessions to the UK to ensure that internal political unity and existing partnerships with other third countries will remain unharmed.
13/ If the UK government is not willing to accept the terms posed by the EU, any deal will likely include only very limited access to the Single Market.
14/ As such an outcome would not be far off from a ‘no deal’ scenario, the UK government might prefer a ‘clean’ break from the EU to nourish the narrative – but rather a smoke screen – of a sovereign global Britain free from external influence.
15/ The coming months will show whether a compromise is still possible. Through the lens of differentiated integration, the preferable options and boundaries for a functioning future EU-UK relationship seem clear. But in the end it will be a political choice.
