Monday, 15 August 2016

There is no point in leaving the single market

Reading up on Indian food safety laws, as one does, we find something that readers of this blog already know.
The Indian food safety regulations, as implemented by the FSSAI, are primarily based on the Codex Alimentarius. The Codex was formed with the collaborative efforts of the World Health Organization and the Food and Agriculture Organization, two eminent United Nations health and food bodies. The Codex Alimentarius international food standards, guidelines and codes of practice contribute to the safety and quality of the food that reaches consumers. Since the FSSAI regulations are framed on the guidelines of the Codex Alimentarius, they adhere to international standards. Other international standards formulated by global agencies like the European Food Safety Authority, Food Standards Australia New Zealand, and the USFDA have also to some extent been assimilated, integrated, and harmonized into the Indian standards, thereby bringing them almost at par with the global standards.
The short of it means that if we leave the single market then we must abide by the same rules as everyone else, as per the Agreement on Technical Barriers to Trade. This blog has long held the view that we are seeing the emergence of a global single market and at the forefront of that is food. Everywhere you care to look the standard for food safety is Codex and that is pivotal to export compliance.

Anywhere where Codex does not apply is an opportunity for foreign aid to be applied for the purposes of trade facilitation, allowing African nations to export while increasing demand for UK scientific and financial services.

In this it really rather helps if we have our own voice and our own vote and our own system of opt outs because horse trading with standards is now the way trade gets done on international forums. It is the very essence of trade now. That is ultimately what makes Brexit necessary.

Presently trade is an exclusive competence of the EU but when it is increasingly regulatory concessions which become the subject matter of trade it gives the EU free licence to appropriate powers according to its own whims.

Free of the EU we become an independent player with our own voice in international trade and the creation of global regulations which even the EU is subordinate to. In terms of taking back control, this is the real business of Brexit where for the first time we will have a genuine veto in the rules we adopt by way of the WTO reservations system.

And since regulation is now global the mission for British trade is not to deregulate but to help emerging economies conform to the global standard thus expanding the single market sector by sector, and if we have any sense we will use DfID primarily for this objective so as to build a global single market outside of the EU's control where the EU will increasingly find itself outvoted or ganged up on by WTO alliances (as happens in the IMO quite frequently).

If the British establishment can at some point realise that the EU is not the origin of regulation and that regulation is the very essence of trade then Brexit gives us a real opportunity to make the single market a common property that functions on an opt-in basis where the more nations subscribe the weaker the EU becomes.

That means the EU can no longer maintain the iron curtain of regulation that effectively excludes competition and the EU will have to liberalise in order to compete. Effectively, Brexit could make the EU single market entirely redundant and make the EU sing for its supper and drop its sense of entitlement.

Now some may lament the loss of EU influence but the fact of the matter is that the rest of the world is catching up fact and asking itself what it owes the EU. Instead of seeking access to established markets it is now looking at more accessible emerging markets with the long view of usurping an uncompetitive EU. If the UK steps up to the plate in providing economic assistance in trade facilitation then it could find itself well placed to be leading alliances at the WTO and forcing the EU to drop many of its protectionist barriers.

If we leave the single market in order to deviate from what are now global standards then we are not enhancing our position globally or giving ourselves a commercial advantage. If we want to turn Brexit into something worthwhile then it is to recognise what the EU single market has done for the UK and break out in order to expand it and stop it being a European white's only club that exists only to protect European privilege.

Once we are free of the EU there is massive scope to reboot global trade and if we reintegrate foreign policy with trade and aid then we can be a global power in terms of trade facilitation. When the focus of global trade is now centred around the liberalisation of services the very last thing we want to do is remain Euro-centric and to that end we need to take a full role at the ITU without asking the EU for permission to enhance transatlantic trade. The fact is that the Eurozone has many defensive interests in the old economy of trade in goods and we are held back by those concerns. Leaving the EU means that we can focus on Britain's digital future without worrying about illegally subsidised French manufacturing.

If we play our cards right in using the EEA as a transitional mechanism then we can use our halfway house position to smash EU protectionism and enhance global governance while at the same time having more of a say in the rules that govern us. For the first time in over forty years we will have a chance to say no when we don't like the rules. The more I look at it the more the prospect of remaining in the EU seems utterly absurd.

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