The UK should carefully consider what is worth sacrificing for a trade deal with a declining market

The UK should carefully consider what is worth sacrificing for a trade deal with a declining market

From an economic perspective, the European Union faces a comparative decline. These are not my words but those of European Commission President, Jean-Claude Juncker, in a speech he delivered in Madrid in October 2015. Juncker said that economically we were witnessing the end of the glorious years of the EU compared to what others were doing and pointed out that soon the bloc’s share of worldwide GDP would be 15% while 80% was already coming from countries not in the EU.

This was eight months prior to the British EU referendum when it was widely expected – most certainly by everyone in Brussels – that Britain would vote to Remain in the EU. This means the bleak economic prospects, to say the least, that were presented in Juncker’s speech are set to become even worse. “The European Union is not doing very well,” the leader of the EU’s executive arm conceded while adding that, demographically speaking, the EU was weakened and would remain so.

While it doesn’t take Juncker to point out that the EU is a comparatively declining market, as many others have observed in recent years, the fact that he recognises the reality when it comes to the EU’s dire economic situation – not always the case in Brussels – only serves to underline the seriousness of the situation. As expected, Juncker’s cure is, as always when it comes to those leading the EU, more integration and thus continued erosion of national sovereignty.

The reality is, as I discussed in my recent Red Cell paper, Fishing for freedom: Lessons for Britain from Iceland’s fisheries experience, that while the EU will remain a rather important market,  comparatively it will gradually become less so. The future markets will be elsewhere, not the least in Asia in countries such as China and India – which means Britain must consider very carefully what is worth sacrificing in order to get a trade deal with a declining market.

While Brussels has used tough language when demanding the right to continue fishing in British waters after Brexit as before – and has said that Britain could face tariffs on the export of seafood to the Single Market if it doesn’t accept that – the EU will continue to be dependent on fish from British waters, regardless of who catches it. Exporters from other countries will find it hard to fill that void. And even if they could, the demand for protein-rich food and food in general will only grow.

The EU will simply have no legal right to fish in British waters after the UK has formally left the bloc, something of which Brussels is very well aware. As a sovereign country, Britain will have an absolute and undisputed right to a 200 nautical miles exclusive economic zone (EEZ) or the median line around the country under the United Nations Convention on the Law of the Sea (UNCLOS). No traditional fishing rights of other countries, real or purported, can override that.

Britain therefore does not have to allow foreign fishing vessels into its waters after leaving the EU and while UNCLOS does instruct coastal states to try to negotiate on shared stocks, that is entirely based on whether the countries in question manage to find common ground. Should foreign fishing vessels be allowed into British waters in the future that should be based entirely on mutually-beneficial bilateral agreements on shared stocks, as is done by sovereign countries.

The British fishing industry and valuable future resources should not be used as a bargaining chip to gain better access to the EU’s inner market and thus sacrificed in the same way it was when Britain joined the EEC in 1973, which led to the foreign exploitation it has suffered ever since. Nor should better access to future markets be sacrificed for that purpose by keeping Britain bound by EU rules.

Leaving the EU is, after all, about the future and not being shackled to the past.