Facts for You

A blog about health, economics & politics

At 11 00 pm on 31 January 2020, the United Kingdom irrevocably left the European Union, bringing to an end three-and-a-half years of intense, polarised and highly divisive debate. This long- and eagerly- awaited moment led to the day being dubbed as Independence Day by many. Membership of the EU had lasted 47 years, although the period of so-called British “vassaldom” can be more accurately dated back to the Maastricht Treaty on the European Union, which was signed on 7 February 1992.

In the 20th century, things were rather different. During the twilight of the British Empire, the tables were turned as the UK busily restored sovereignty to a multitude of nations, widely scattered throughout the world. The British Empire had begun to contract ever since the Irish Free State gained its independence in 1922. This process rapidly accelerated during the second half of the 20th century, when the various nations of what is now the British Commonwealth, along with Burma (Myanmar), became independent nations, regaining the “control” that the mother country was herself to strive for so assiduously in the years to come.

Independence Day was marked by a number of events. London’s Parliament Square was the scene of joyous celebrations from 9 pm to 11 pm, conducted amid a profusion of Union Jacks, while a countdown clock was projected onto No 10 Downing Street from 10 pm to 11 pm, ticking away to a “new dawn”. There was much cheering and drinking, and Wetherspoons pub chain even offered cut-price pints to lubricate the occasion. Three million 50 pence Brexit commemorative coins (initially forged for the original Brexit Day on 29 March 2019), bearing the inscription “Peace, prosperity and friendship for all nations”, were finally released into circulation. The Department for Exiting the European Union abruptly ceased to exist. The celebrations were not confined to London. Celebratory pub crawls, parties and rallies were conducted throughout the country, along with a smaller number of vigils where commiseration was the prevailing emotion.

The response in Brussels was, however, more sombre and muted. Amid widespread proclamations of sorrow at the British exit, the Union Jack was lowered outside the European Commission building, while the 73 British and Northern Irish MEPs vacated their premises for the last time- some sad and tearful, and others delirious and vocal with joy. Britain immediately ceased to be a member of all EU political institutions, losing its voice in Brussels and Strasbourg. While the political centre of the EU remained unchanged, its geographical centre shifted 35 miles south-east, though still within Bavaria.

Things will not visibly change in the short term, although incremental changes are to be expected in the ensuing 11-month transition (or implementation) period. During this period, the UK will remain within the European single market and customs union. Trade talks with the EU will have to proceed hastily, as a draft trade agreement has to be reached by 30 June 2020 at the latest. Failure to achieve accord between the UK and the EU by 31 December 2020 could still potentially lead to a No-deal Brexit scenario, as any further extension to the transition period is not allowable under recently enacted British law.

The primary concerns of the British public seem to include the establishment of new trade deals, the imposition of stricter immigration controls, and the promulgation of new British laws and regulations, unfettered by EU restrictions. International trade as it stands is, however, not based on strictly free market principles, but is more protectionist in nature. Global patterns of trade seem to be heavily dependent on geopolitical factors, and dominated by self-interest, exemplified by “America First” policies. Trade seems to be widely dominated by tariffs and quotas, and has even led to so-called “trade wars”. In many cases, trade is actually stifled through sanctions imposed on so-called “pariah states”. The bargaining power of the various nations is indeed highly leveraged by their individual economic, political and military might. There is indeed no level playing field when it comes to making global trade deals.

The somewhat asymmetrical “special partnership” with the US is likely to face its greatest tests yet. The mighty bargaining power of the US may force British concessions, especially when it comes to favouring the import of American agricultural and pharmaceutical products, and may actually lead to the watering down of proposals to impose heavier taxes on American corporate giants with a global presence, such as Amazon and Google. America can, and has been known to, employ carrot-and-stick tactics when it comes to trade, and may insist that British foreign policy is aligned to that of the US as a precondition for proceeding with mutual trade deals.

Uncontrolled immigration has been a particular concern for the British public. It appears that new government policies will aim to reduce the need for unskilled migrants, while simultaneously attracting scientific and mathematical talent through the fast-track “Global Talent” visas for migrants with exceptional skills in these areas. The Australian points-based immigration system may well be adapted for British law in due course, but mainly for restricting rather than attracting increased numbers of potential and suitable migrants. Stronger border controls are also being proposed in order to eliminate illegal immigration in its various forms, including people trafficking.

It is envisaged that EU laws and regulations will be subjected to one of three possible processes post-Brexit, some being adopted without change, some being modified after Parliamentary debate, and some discarded altogether. In some areas of legislation, the UK is threatening regulatory divergence from the EU, but such changes may adversely impact the prospects of largely frictionless trade with the EU. The EU appears to be particularly concerned about citizens’ rights, workers’ rights, environmental protection and food standards, all of which could potentially change in a new and “liberated” UK, thereby leaving the desired “level playing field” out of the question. Negotiations between the EU and the UK are further complicated by the demands for continued access for EU trawlers fishing in UK waters as a precondition for any future trade agreements.

Irrespective of the trajectory and timing of events in the run-up, what is likely to happen in December 2020 cannot be predicted with any degree of certainty. There is, however, no looking back. It is now up to the government to engage with the detail and to proceed post-haste with the various negotiations, given that time is not on the side of the UK. Whatever happens, the hope is that the resulting changes will genuinely benefit British society as a whole.

Ashis Banerjee (impartial observer from the sidelines)