Many remain voters make the argument that the EU will refuse to offer us a good free trade agreement (FTA) as this would incentive other member states to leave the union and that the EU will instead punish us for leaving and make an example out of us. This argument contains a number of significant flaws.
Firstly, the EU is very much limited in their capacity to punish us – there are no tariffs worldwide on services and the average World Trade Organisation (WTO) most-favoured nation (MFN) tariff on goods is less than 5%. (Please see my previous article for more reasons why the EU is very much limited in its capacity to punish us). The leaders of the EU have repeatedly stated that they’re not going to punish us.
Secondly, the UK is and has always been completely different from all of the other EU member states. We originally had our membership application vetoed twice as it was thought that the protectionist nature of the EU wouldn’t suit us (it hasn’t) and we consequently joined later than some other member states. We’ve always been significantly more Eurosceptic than all of the other member states as was shown in the rebellion over the Maastricht Treaty. The Brexit Secretary David Davis made this point in an interview with Nick Ferrari.
Even the former President of the EC, Jacques Delors, said in 2012 ‘The British are solely concerned about their economic interests, nothing else […] If the British cannot support the trend towards more integration in Europe, we can nevertheless remain friends on a different basis. I could imagine a form such as a free-trade agreement’.
Thirdly, the EU already has FTAs with more than 50 non-EU countries which don’t require the freedom of movement of people or annual payments and the EU didn’t stop themselves from signing these deals in case it might incentivise member states to vote to leave the union. If the EU refuses to give us a good FTA, it could back-fire as it may well make British voters even more Eurosceptic and anti-EU. The initial and rather arrogant response of some EU figures to Brexit has already caused some people such as Conservative MP Ben Bradley to convert to the Brexit cause. As Daniel Hannan MEP has pointed out, it’s extraordinary that remain voters constantly use this punishment argument whilst also simultaneously arguing that the EU is an ‘irenic peace project’ which is all about brotherhood. This punishment argument implies that the only glue that holds the EU together is the fear of what might happen if one of its member states democratically votes to leave. This is much less like an ‘irenic peace project’ based on brotherhood and much more like the Soviet Union and its relationship with its “satellite states” in Eastern Europe. As the Soviet Union’s last Premier, Mikhail Gorbachev, himself put it: ‘The European Union is the Soviet Union in western clothes’. Why would the EU want to show itself in this light? The impression that a hostile Brexit stance would create could damage the EU by, for example, deterring other countries from applying to join the EU. The EU would obviously not want this.