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How UK foreign policy benefits from EU membership, and the pitfalls of Brexit

Article by Jacqueline Hale

August 31, 2018

How UK foreign policy benefits from EU membership, and the pitfalls of Brexit

As the UK faces the uncertainty of Brexit, this article examines how its policies towards third countries including enlargement, trade, migration, development and energy policies have been mediated through the EU membership. It demonstrates how the UK has used the EU to amplify power, to protect UK interests and security, and to pursue its foreign policy priorities and interests. Finally, it offers some thoughts as to the risks to the UK’s foreign policy influence following Brexit.

A power amplifier

The UK has had a successful history in normatively influencing the EU through its membership. The impact of the UK and the FCO over the last 40 years in ensuring that its ideas are transmitted via a 28-member bloc and its networks across the world should not be underestimated. Some of the EU’s most enduring policies testify to British ideas at the heart of EU decision-making: From Churchill’s European vision which led to the founding of the European movement, to the widening (as opposed to deepening) of the union via its enlargement and neighbourhood policies the UK has been a thought leader on EU foreign policy. The enlargement of the EU in 2004 to admit 10 new members radically altered the centre of gravity and emphasis of the union to Whitehall’s liking[1]. In recent years, the EU has been more Anglo-Saxon than ever in its interactions beyond its borders – and not just because the language of its business is English. EU Free Trade Agreements – often negotiated by UK trade lawyers – draw the interest of trading giants, such as latterly, Canada, the US[2] and Japan. In a number of foreign policy areas, from the Common Foreign and Security Policy (CFSP) which enables the EU to speak with one voice on political affairs in relation to third countries and articulate EU common interests and values, to policies ranging from border control to energy and climate change to development – the EU amplifies British soft power.

Safeguarding UK interests

The EU has played a key role in safeguarding UK interests ranging from sanctions to Justice and Home Affairs (JHA) policy. On the bigger foreign policy questions, including sanctions on third countries following abuses of power and violations of international norms, the UK has been able to draw on collective bloc decisions which favour its position and avoid being singled-out to face negative political and economic consequences, such as export bans on arms/equipment. The EU is also one of the only mechanisms by which Britain can successfully push its pro-sanctions position (notably on Russia and Syria) since sanctions are frequently rendered impossible via the UN route due to Russian and Chinese veto at the UNSC. The departure of the UK has led some allies (notably Scandinavian countries and the Netherlands) to express concern about a possible shift of the balance of power within the EU on EU-Russia policy. It may make the EU common position more susceptible to pressure from Austria, Italy and other governments to weaken the sanctions policy.

The EU has also offered the UK a useful ‘’bad cop’’ in situations where UK bilateral policy is to appease rather than sanction a third country: The June 2018 EU sanctions on Myanmar generals as a result of suspected crimes against humanity against the Rohingya were tacitly supported by the UK as a means of applying pressure for accountability, whilst allowing the UK, the former colonial power, to pursue a pragmatic, pro-engagement bilateral policy toward Aung San Suu Kyi’s Government. In the case of Libya in 2011, the UK benefited from the unanimous endorsement of EU sanctions, which went further than UNSCR 1970 as well as asset freezing[3]. These coordinated moves by EU member states provided political space for more concerted action by the EU’s two military and diplomatic powers, UK and France – even taking into account Germany’s abstention at the UN Security Council.

In contexts where individual EU member states such as the UK are considered partial, the EU is also able to achieve outcomes as an honest broker – notably in the success of the European External Action Service on the Iran deal, and in current mediation efforts by the EU High Representative in the Western Balkans. Through its work on conflict prevention and civilian crisis management, the EU is doing more on the ground than other conflict prevention formats in which the UK has a stake in the Eastern and Southern European neighbourhood: OSCE, NATO, UN or G20. EU civilian crisis management policy is able to do more in Moldova and Georgia than the OSCE (which remains hobbled by Russia) or NATO for whom the region is too politically sensitive to enter. EU Operation Sofia, in the Mediterranean, for all the challenges of its mandate, mounted a serious smuggling prevention operation.

There is great complementarity and burden sharing opportunities for larger EU member states, such as the UK: The EU mission in Libya on border security supports the UK intervention as well as UK national security concerns, just as by analogy the EU Training Mission (EUTM) in Mali supports France. The multinational pool of expertise for EU deployments to these missions supports wider knowledge sharing and transfer. EU civilian crisis management missions provide an outlet for UK policing ideas via their personnel, whereas in other contexts where the UK has a stake but less cultural reach and expertise (for example Armenia and Moldova), experts from Central and Eastern European states do that job. The EU is also effectively providing a security guarantee for Georgia. Despite the UK’s tough stance on Russia, it is not clear that the UK has the geopolitical capital or financial resources to deploy a mission on the scale of, for example, the 200-strong EU Monitoring Mission (EUMM) in Georgia and would not consider doing so alone. The EUMM complements the FCO’s dedicated bilateral funding ‘niche’, supporting conflict-prevention NGOs in the South Caucasus region.[4]

Free-riding on Home Affairs

The EU has also expanded UK influence in relations with partners – at a limited material cost to the UK. The Enlargement process, and the European Neighbourhood Policy and its successor in the East, the Eastern Partnership, have carried weight in partner countries for whom association with the EU means clean water, safe transport, travel opportunities through easier access to Europe, via budget airlines, and the potential to sell goods to a market of, currently, 500 million people.

This leverage has allowed the EU to demand reforms on migration and asylum in exchange for visas for the Schengen area, such as justice reforms or anti-corruption measures in public procurement which, when implemented by neighbouring countries, also benefit the UK down the line. The obligation on partner countries to cooperate with Eurojust and Europol protects the UK. In the EU’s Eastern Neighbourhood, five out of six countries have signed or are negotiating visa facilitation agreements have been obliged to adopt readmission agreements.[5] Since the visa facilitation agreements apply only to Schengen the UK has valid readmission agreements without giving up anything materially. Other EU member states have borne the cost of the reduction from 60 Euros to 35 Euros for a single-entry Schengen visa[6], or for the free visas offered to an extended list of categories, ranging from students to journalists. With its decision to leave the EU, the UK faces the prospect of concluding bilateral readmission negotiations with each of these third countries which may cost it more in concessions on visa. At the same time, it is not clear that Britain alone would have the leverage to negotiate the accompanying reforms, whose implementation is also supported through pooled EU funding, and trade incentives (see below).

Large trading market

The EU as a trading bloc with a single-market has more clout in a partner country than any single EU member state. Britain has long embraced this vision. In the neighbourhood, as elsewhere in the world, the EU facilitates market access and investment opportunities for British companies through its Common Commercial policy. For many countries outside Europe, the EU collectively is the largest trading partner: In 2015 – EU trade with Ukraine was worth 31 billion USD whereas Britain’s trade with Ukraine was 2.1 billion USD[7]. The Deep and Comprehensive Free Trade Agreements (DCFTAs), negotiated with Eastern neighbours, and considered for the Southern neighbours, are modelled on the successful accession process and aim to increase exports and investment through opening new markets. Because standards are high they also protect the EU’s member states including Britain against dumping. Through ensuring that neighbouring countries align their legislation with EU standards, the EU not only opens but transforms markets. DCFTAs aim at transforming societies on the EU’s periphery by demanding reforms in areas ranging from customs practices to taxation to product standards, with broad implications for the fight against corruption and good governance.

As well as the benefits for British companies, Britain can afford to be clear that regulation is both necessary and useful for its foreign policy, both in strengthening the EU internal market in key geo-strategic areas such as energy – see below – and raising standards among neighbours. Britain alone would be less likely to achieve this level of convergence with its legislation, nor be able to offer sweeteners on the scale of the €12.8 billion offered by the EU to support the reform process in Ukraine[8]. This is a political as well as a technical question in a country like Ukraine, where the EU is its largest trading partner and – together with Russia – accounts for 50% of Ukraine’s trade.

Likewise, the size of the EU energy market gives it real clout in the sector. The EU has taken the lead on negotiating MoUs to establish gas pipelines of strategic importance to the EU27, notably the Southern Energy Corridor. The transnational nature of the issue, as well as the scale of collective EU energy demand, means that the EU Commissioner for Energy has more leverage than a single member state. At the same time, EU energy policy, including the Energy Union and particularly the Energy Security Strategy (2014) links the liberalisation of the internal energy market to the achievement of reduced dependence on particular external actors in a way that national policy could not. By launching an anti-trust case against Gazprom in September 2012, the European Commission’s DG Competition has been fighting the corner for British business and British strategic interest through challenging Gazprom’s monopoly[9]. This is an example of where EU single market rules and regulations in competition policy act in the British interest. Further, the EU has established an Energy Community –which is expanding the EU acquis on the security of supply, energy efficiency, oil, renewable energy and statistics to countries ranging from the Western Balkans to Ukraine, creating reliable markets for British companies.

Global development

In development policy, the UK – as a top bilateral development donor, as well as a net contributor to the EU development budget – leverage the EU’s funding, networks and delegations. The EU, together with its member states, is the world’s largest development donor. Much of EU development and humanitarian policy thinking has been shaped by the UK. The Department for International Development (DFID) has used its own leverage as a top donor historically to shape the EU’s development policy focus on health and education in development and prioritisation of the the Least Developed Countries, as well as funding modalities pursued by the EU’s humanitarian assistance department (ECHO), most recently on cash-programming.  DFID often works in Joint Actions with the EU, notably in West Africa. EU and UK ‘super grants’ are fostering development outcomes on a greater scale on issues such as infant nutrition, in Bangladesh[10]. With the UK contributing up to 15% of the EU’s Development Fund annually[11] and ‘paying to play’ in setting the EU’s priorities through the fund, the challenge for the UK (and the EU) post-Brexit, will be to make less funding go further in transforming lives and buying change.

Losing out from the divorce

Whether the EU can continue to exercise the power of attraction at the same level without UK membership is an open question. The Union faces a number of political challenges aside from Brexit, including open challenges to its own values from existing members, most notably ins Hungary and Poland[12]. The new long-term budget of the EU is likely to shrink directly as a result of Brexit, and indirectly as other countries seek to use funding leverage to articulate demands[13].

Yet, all the signs are that challenges for Britain as a result of Brexit will be arguably greater. In an increasingly multipolar world, one which belongs to regional trading blocs and bigger countries, it is unclear what advantages can be derived from the UK’s ‘Global Britain’ policy. A pivot to an Asia-Pacific strategy and a rekindling of colonial ties could prove costly, given that the majority of the UK’s trading partners are next door. The EU accounted for 90% of the UK’s trading in 2017, considering that it was the destination for 44% of UK’s exports, with 53% of the UK’s imports coming from the other 27 EU member states[14]. This market of 500 million people allows the UK to enjoy some 50 trade agreements with countries and regions across the world[15]. It follows that post-Brexit bilateral deals struck for a UK market of 66 million people will be harder to come by, and will take time, during which the UK will be subject to high tariffs under basic WTO rules.

A diminished economic power will also face diminishing returns in foreign policy: With Britain on the sidelines – at best being permitted to observe foreign policy ministerial decisions by the EU27 – there will be less potential to influence EU-bloc decisions that are taken into multilateral fora, from the WTO to the Human Rights Council. Although it cannot yet be quantified, the loss of UK influence in Brussels foreign policy decision-making during the Brexit process indicates worst to come. Put simply, the UK risks losing normative and soft power through exiting the club that it has so successfully shaped.

[1] The fact that the 2004 enlargement arguably was a fact in sowing the seeds of Brexit has more to do with successive UK governments’ poor handling of the migration debate than the policies of the new EU members

[2] The Transatlantic Trade and Investment Partnership has so far failed to come to fruition, but negotiations are quietly ongoing and would see the US submit to EU standards whilst uniting the two markets to form the world’s largest trading bloc.

[3] In COUNCIL DECISION 2011/137/CFSP and COUNCIL REGULATION (EU) No 204/2011  https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32011R0204&from=EN The EU placed 20 people on its visa ban list in addition to the 6 on the UN list

[4] DFID downgraded the Eastern European countries a few years ago.

[5] These are: Ukraine, Moldova, Georgia, Armenia and Azerbaijan

[6] Currently offered to children under 12 and citizens of: Georgia, Kosovo, Russia, and Ukraine

[7] See: Ukraine Foreign Ministry https://uk.mfa.gov.ua/en/ukraine-uk/trade and DG Trade http://ec.europa.eu/trade/policy/countries-and-regions/countries/ukraine/

[8] For an overview of macro-financial assistance from foreign partners to Ukraine see http://www.aalep.eu/financial-assistance-ukraine

[9] The case was concluded in May 2018 without fines to Gazprom, but with a deal outlining significant concessions by the company designed to break its monopoly, including on price-setting and removal of contractual constraints that had prevented clients from reselling gas

[10] https://everyone.savethechildren.net/articles/tackling-child-malnutrition-bangladesh-suchana-programme

[11] The UK is the third biggest contributor to the European Development Fund, behind France and Germany. See UK Parliament: https://publications.parliament.uk/pa/cm201012/cmselect/cmintdev/1680/168005.htm.

[12] The electoral victory for Matteo Salvini in Italy, and an increasingly right-leaning Austria are a sign of a growing populist challenge to the EU across its member states.

[13] Matteo Salvini has invoked the methods of Donald Trump in threatening to withhold Italy’s annual contribution to the EU budget unless the other Member States enact burdensharing arrangements for the reception of migrants and refugees. https://www.theguardian.com/world/2018/aug/24/eu-dismisses-italys-threats-in-migration-ship-row-suspend-budget-payments

[14] https://fullfact.org/europe/uk-eu-trade/vvbb

[15] European Commission, Memo- The EU’s bilateral trade and investment agreements – where are we?, December 2013, http://trade.ec.europa.eu/doclib/docs/2012/november/tradoc_150129.pdf#page=6

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