The Swiss Wheeze: the Better Off Out argument that’s full of holes

by Stephen Tall on April 3, 2014

Swiss CheeseIf only we were Switzerland, eh? That’s the dream of the Better Off Out brigade, who long for its freedom as part of the European Free Trade Association (EFTA). And it’s a tempting offer: all the benefits of free trade with EU member states, and (if you believe Nigel Farage, Dan Hannan et al) none of the risks.

Except it’s not quite that easy, as The Economist highlighted when it investigated Britain’s options.

Here are 5 reasons to be sceptical of the Sceptics’ alpine panacea…

Britain would be a smaller, more isolated country.

“Britain would have less diplomatic and military clout, too. For the Americans, a Britain that is disengaged from the rest of Europe would be a much less useful and influential ally. For NATO, a Britain that is semi-detached from Europe would weaken the ties that bind the continent and its defence to the United States at a time when those ties are already under strain because of slashed defence budgets and America’s strategic “rebalancing” towards Asia. Another likely casualty would be the budding Anglo-French defence treaty, seen by both countries as a way to help themselves continue to punch above their weight.”

This, of course, suits the isolationist Ukip very well. But for those of us who are internationalists becoming an irrelevance on the world-stage isn’t an attractive option.

It took the Swiss a decade to negotiate the trade treaties we already enjoy.

“The British would doubtless try to negotiate a special deal with their former partners, using the argument that trade benefits both sides and that Britain is itself a large market for many. But the process could take many years (it took a decade for the much smaller Switzerland).”

Sure, it would probably take the much larger Britain less time. But that’s a long period of instability tied-up doing little else but try to get back to where we were.

And those deals Switzerland does negotiate tend to be less good – say the Swiss.

“The EFTA countries tend to rush in behind the EU, though in some cases—South Korea, for example—they go first. But the bigger club can win slightly better terms. “The EU is more powerful than we are,” says Didier Chambovey of Switzerland’s state secretariat for foreign affairs.”

Hardly surprising: if you’re part of the world’s biggest economy, as the UK within the EU is, then you get a better deal.

The British would get less generous treatment than the Swiss.

“There is little chance that Britain, a far bigger country with a history of being difficult, would be allowed to squeeze in alongside Switzerland. … The halfway options of Norway and Switzerland were offered largely in hopes of tempting both to become full members one day. Britain would be travelling in the opposite direction, without a map. In this, as in so many other ways, leaving the EU would be a colossal gamble.”

There’s every incentive for the EU to woo a country it hopes will become a member. There’s very little incentive to treat a country well that has walked out on it.

The Swiss have less power outside the EU than the British have in the EU.

“[Switzerland] is not beyond the reach of Brussels. The Swiss are currently exercised over several European directives, including those covering finance, chemical factories and the movement of labour. Switzerland is hampered by the lack of an accord with the EU on financial services and by its lack of representation in Brussels. In the broader fight against protectionism and financial over-regulation in Europe, it relies on an informal alliance with another country that also has a big financial-services industry, as well as a valuable seat at the negotiating table: Britain.”

If Britain leaves the EU, paradoxically the Swiss option becomes far less attractive.

* Stephen Tall is Co-Editor of Liberal Democrat Voice, and editor of the 2013 publication, The Coalition and Beyond: Liberal Reforms for the Decade Ahead. He is also a Research Associate for the liberal think-tank CentreForum and writes at his own site, The Collected Stephen Tall.

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One comment

[…] tended to be suspicious of the Swiss option – all the benefits of the EU’s negotiating power and of free trade within the EU, few […]

by Liberal Hero of the Week #66: Brexit Prize-winning Iain Mansfield | CentreForum Blog on April 11, 2014 at 10:11 am. Reply #

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