Should the UK stay in the EU or leave? – The London Economic

Should the UK stay in the EU or leave?

By Professor Christopher H. Bovis, Professor of International and European Business Law, University of Hull

Inevitably, the question of UK membership of the European Union will be centred on two issues:

  1. The need for reform of EU institutions and the way the EU is governed
  2. The ability of the UK to influence EU decisions

Reform is badly needed

The European Union is malfunctioning. It has lost the zest of the “common market”,becoming instead a self-fulfilling prophesy of political union with disproportionally bureaucratic and centralised governance. There is a significant democratic deficit of EU institutions, and the role of national parliaments has gradually been decreasing. Decision and lawmaking have become a “horse-trading” practice between member states, resulting in compromises and poor quality rules and regulations. The European Monetary Union and the single currency, although necessary components of the common market principles, have not been as successful as they should have been. The EU Budget and its process require urgent review. Finally, the priorities of the EU need reassessment; is the Common Agricultural Policy fit for purpose in the EU of today? The amount it draws directly from the EU Budget at the expense of Research and Development, Education or Infrastructure. Many may agree but few will come up with reform proposals.

What is good for Britain?

External relations, weather trade or diplomatic are best pursued uniformly. One voice achieves much more than a divided multitude of opinions. The UK in its 40 plus years of EU membership has influenced dramatically the function of the common market. The UK instrumentally shaped essential policies of the European Union which epitomise its existence and its success; the UK moulded and formed the Competition Policy, the Common External Policy, and the Internal Market. The vast majority of WTO / EU agreements have been intellectually and conceptually underpinned by the UK. The EU / China relations reveal a strong British influence in the architecture of the deal. Despite this, the UK rarely receives credit for its role. Britain has shaped significantly the EU and in return it has benefitted significantly in trade and international stature. The UK is one of the most attractive destinations for direct investment globally, because of its EU membership and its pragmatic, flexible and inclusive domestic markets.

Size matters

The EU represents the biggest trading partner of the UK. Very few argue against this. The critical component of the benefits from the EU membership is that the UK’s trade volume does not have to bear tax and duties. Therefore, when UK products and services cross borders, they do not become anti-competitive because of the imposition of import taxes. Exiting the EU will eventually present this real dilemma for the UK: the risk of finding and establishing such competitive trade flows with other parts of the globe. Is such risk worth taking?

 

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