The Norway option could offer Britain the best of both worlds
3 min read
If Britain crashes out of the European Union without a deal in place, there is only one realistic option. We must rejoin EFTA – and ensure a soft landing, writes Antoinette Sandbach
In order to secure the best possible Brexit, it is vital that MPs analyse and assess all available options. That is why I am leading a Westminster Hall debate on Wednesday morning focusing on the alternatives to a ‘No Deal’ outcome in our negotiations with the EU.
Lyndon Johnson claimed that the first rule of politics is knowing how to count. I hope that this debate will demonstrate to ministers that the number of MPs who think that no deal should result in a soft landing far exceeds those colleagues who hanker for the hardest Brexit possible.
Over the last few weeks we have seen quite how damaging a ‘No Deal’ Brexit could be. Treasury estimates have shown that WTO terms would reduce GDP by 8% over 15 years. The impact would be most strongly felt in the Midlands, the North and the devolved nations. The consequence for my own constituency would be dramatic; the North West is projected to take a 12% hit. What is more some of my area’s key industries – chemical, automotive and pharmaceutical – are all at risk.
So, what are the other options?
The first alternative to WTO terms is the successful delivery of a “deep and special partnership” as the government has promised. I support this goal. I hope that the government ensures that the services industries are included in this deal; as to not do so would damage some of our most globally competitive sectors.
The second alternative is perhaps as politically dangerous as WTO terms are economically disastrous. There are some who advocate that we should just stay in the EU. This is unrealistic. It defies the will of the people and would cause a compound fracture in the body politic.
The third option is by far and away the best alternative to a No Deal exit, the so-called ‘Norway option’. By re-joining EFTA we would ensure a soft landing should we ‘crash out’ without a deal. Instead of facing WTO terms we would have a range of trade deals with 27 countries, as well as access to the EEA, guaranteeing our continuing economic relationship with Europe.
If learning to count is the first rule of politics, it is also good economic practice. WTO terms would see a 40-60% drop in trade with the EU whereas EFTA would see a comparatively small dip of 12%, securing thousands of jobs that would otherwise be lost. It would also protect our financial services sector and the £10bn of tax revenue that it generates.
It’s not hard to see why even staunch Leavers like Nigel Farage, Daniel Hannan and Sir Bill Cash have, at one time or another, talked up an EFTA style arrangement.
Some say that the only way to respect the result is to default to WTO terms and pull up the drawbridge. I disagree. EFTA would allow us to protect our prosperity and respect the outcome of the referendum. EFTA would see us outside of the Common Agricultural Policy and the Common Fisheries Policy. It would protect us from ‘ever closer union’ as well as any threat of joining the euro. What is more, under certain circumstances EFTA allows an emergency brake on immigration.
No doubt there will be a range of views on Wednesday, but I hope colleagues from all sides of the House will turn up and demonstrate to the government that there is a substantial and popular middle ground between the unrealistic few who want to remain in the EU, and the economic peril of no deal hardliners.
Antoinette Sandbach is Conservative MP for Eddisbury. MPs will debate ‘Alternatives to a no-deal outcome’ in Westminster Hall on Wednesday 21 February
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