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It’s starting to heat up in Brexit-land after 17 months of jockeying for position, and this month more than any month since June 2016 might indicate whether UK Prime Minister Theresa May’s critics are right or wrong.
Will Theresa May travel confidently to the European Union this week to explain what she expects to receive in exchange for offering a £40 billion divorce payment? Or will she arrive and meekly accept whatever crumbs fall from the EU master’s table?
The result will determine what Prime Minister Theresa May will be called for the rest of her political life — she’ll either be known as ‘Theresa the Brilliant’ or ‘Theresa the Appeaser’ — or worse variations of those two titles.
Why Would the UK Choose to Offer £40 billion to the EU?
Certainly, the UK has pension and other legitimate obligations to the European Union that must be covered in the post-Brexit timeframe, no one is disputing that.
Also important to this discussion is that the UK has been and remains the second-largest contributor to the EU budget and is thereby part owner with the European Union of many shared buildings and properties — like the EU Parliament building in Brussels, for instance. (Total UK equity in the EC/EEC/EU institutions and real estate could be as high as £9.65 billion, although it’s difficult to find agreement on the amount)
So the question becomes; What’s the UK paying for, when it offers apropos of nothing, £40 billion?
Clearly, it isn’t to cover the legitimate obligations of the UK post-Brexit which amount to £6.15 billion, nor does it factor-in the UK’s share of the EU’s institutional equity — some £9.65 billion worth of land, buildings, and other holdings.
Indeed, Germany (#1) and the UK (#2) have paid the largest share of the EC/EEC/EU’s operating budget since 1972, and in recent years the UK’s annual net payment to the EU has hovered around £8 billion.
Therefore it would seem that the £40 billion offer to the EU isn’t to pay future obligations, but that PM Theresa May has decided to pay in advance for (a) a bespoke free trade agreement with the European Union, (b) a bespoke Northern Ireland border agreement, and (c) to clear every single miscellaneous issue so that Brexit can proceed quickly.
And if that’s the Prime Minister’s thinking, it seems sound logic although it could be seen by some pundits as an expensive way to go.
Q: “Could I Have a Nice and Clean Brexit?”
A: “That Will be £40 Billion, Please.”
If Prime Minister May gets a nice clean Brexit, the UK can then sign free trade agreements with most of the countries and trading blocs in the world, in addition to maintaining a healthy trading relationship with the European Union which accounts for 15% of all global trade.
In addition to that, such a bespoke Brexit payment should guarantee perfect cooperation on a soft border between the Republic of Ireland and Northern Ireland.
It should guarantee that the European Court of Justice won’t comment or interfere on UK matters, and it will simply become one of many global courts that UK judges consult when making precedent-setting rulings.
And because in the whole history of the world there has never been such an unprecedented £40 billion divorce payment, Prime Minister Theresa May and every subsequent UK Prime Minister should be entitled to the utmost respect in EU capitals until the year 2100.
It Sounds Expensive, But It Isn’t
Once the UK signs free trade agreements with China, with all of the UK’s Commonwealth partner nations, with the United States, and perhaps ASEAN nations, MERCOSUR, Russia and its CIS partners, African Union member nations, and with other free trade associations like the Pacific Alliance, the UK will dramatically ramp-up exports to more than five billion people around the world.
If the Prime Minister and her negotiators can sign reasonable free trade agreements with much of the world immediately post-Brexit, it means that instead of paying the EU a net annual payment of £8 billion — increased exports and other positive economic activity (such as increased tourism) will boost the UK economy by £10 to £20 billion annually.
Making Theresa May’s present plan look brilliant, in retrospect.
A Slight Lag, Followed by Economic Boom
Although the first year won’t show instant results, and it depends on the quantity and quality of those free trade agreements and upon how quickly UK exporters can respond to the changed market, as time rolls forward, paying £40 billion to the EU in order to gain a bespoke Brexit and Free Trade Agreement might seem like an exceptionally wise decision by Theresa May.
At the very least and to get the ball rolling in the first few days after Brexit, the United Kingdom could coordinate military procurement with other Commonwealth of Nations countries so that navy destroyers, frigates, coastal patrol craft and army tanks required by Commonwealth countries could be sourced from the United Kingdom. The bonus of such a plan is that through bulk purchasing power and common design parameters, such military equipment costs could be reduced for all member nations.
That plan has ‘instant success’ written all over it because there is a real need among those countries for new and used UK military equipment.
Either Theresa May is one of the brightest politicians of our century (paying £40 billion to get free of the EU more quickly and completely, and by obtaining a bespoke UK/EU free trade agreement) or she’s heading off to Brussels this week to accept whatever crumbs the EU mandarins toss her way.
As the entire country waits this week for the news reports, let’s hope she’s the former.
Thanks to the dedication of thousands of people, the problems that plagued Northern Ireland for decades have all but disappeared. While we mourn those lost during ‘The Troubles’ we must move forward and provide the best possible future for the people of Northern Ireland and the Republic of Ireland.
The best way to continue to move forward is for a ‘soft’ border between Northern Ireland and the Republic of Ireland so that the free movement of people and unimpeded trade may continue along the 310 mile border.
Many people on both sides of the border meet for tea, travel across the border to shop, or are employed on the other side of the border and it would be unfair to require these people to face a regular border crossing twice daily. And a hard border would definitely hinder trade, which trade is a vital part of the local economy along both sides of the divide.
A dedicated ‘Commonwealth and Ireland’ line at UK ports of entry
The smartest thing the Home Office UK Visas and Immigration department could do is to create a separate queue line at all UK ports of entry and mark it “Commonwealth and Ireland” so that people from Commonwealth countries or from the Republic of Ireland have a dedicated and streamlined entry into Britain.
In this way, goods and people can move much more efficiently between those jurisdictions.
If it sounds like I want to favour people from Commonwealth nations, you’re right. If it sounds like I want to favour people from Northern Ireland who may decide to fly to Britain, you’d be right. And if it sounds like I want Republic of Ireland citizens to easily travel to any part of the UK, you’d be right in that assumption.
Special Treatment at UK ports of entry: A ‘Nexus Card’ for frequent travelers between Ireland and any UK port of entry
Here in North America, citizens who cross the U.S. / Canada border can apply for a Nexus Card or an Enhanced Driver’s Licence — either of which dramatically speed border crossing times for holders of those cards — and not incidentally, also lowers wait times for the people in the non-Nexus lineups because fewer people (or vehicles) are traveling in that particular queue — it’s a bonus for frequent travelers in North America.
Such a streamlined customs experience should be extended to all Irish citizens as a courtesy — and for the Republic of Ireland in exchange for their help in patrolling and securing the soft border with Northern Ireland.
The UK Government (UK.gov) Paper on Northern Ireland and Ireland
“The UK government pledges to protect the Belfast Agreement and Common Travel Area in new position paper published August 16, 2017.
The Government has today published a comprehensive paper which outlines the UK’s position on addressing the unique circumstances of Northern Ireland and the land border with Ireland.
The position paper — which has been published ahead of the August negotiating round — states that the Government will protect the Common Travel Area (CTA) and associated rights for UK and Irish citizens, and put upholding the Belfast (‘Good Friday’) Agreement at the heart of its Exit negotiations.
The paper also puts forward proposals on avoiding a hard border on the movement of goods — making clear the UK’s position that there should be no physical infrastructure at the border — and plans to preserve the wide range of institutional cooperation between Northern Ireland, Ireland and Great Britain including for the energy market.” — From the UK.gov website
Trade Between the UK and the Republic of Ireland
Billions of pounds sterling in trade crosses between the UK and the Republic of Ireland and a significant amount of it is spent in the small and medium-sized business (SME) trade. Keeping the border open, yet enhancing security will be a challenge for both the UK and the Republic of Ireland, but with good will and some visionary thinking it shouldn’t be too difficult to get an agreement that benefits the largest number of people.
A Soft Border between Northern Ireland and the Republic of Ireland is in everyone’s interest
For as long as the Republic of Ireland remains a member of the European Union it’s in everyone’s best interests to keep the soft border arrangement and to work together to enhance security on both sides of that soft border by any reasonable means.
If that means having facial recognition technology and vehicle license plate readers at all government buildings and properties, ferry terminals and international airports in Northern Ireland and Britain, it’s a small price to pay to preserve and enhance security for the EU, for the Republic of Ireland, and the UK including Northern Ireland.
The soft border between Northern Ireland and the Republic of Ireland must work for citizens of each country, for small (and large) business, and it must ensure a high level of security for both the EU and the UK. This is one Brexit negotiation that must succeed for the benefit of all.