Post Covid World: What Happens to the Eurozone?

After the shocking results of the United Kingdom’s referendum to withdraw from the European Union (EU) in 2017, Euroscepticism has spread throughout EU member countries outside of the United Kingdom. Pew research center concluded that the amount of Europeans who are no longer confident in the EU is on the steady rise.

Despite the rise of Euroscepticism across the general region of members in the European Union, Europeans have different opinions regarding the eurozone and the European Central Bank (ECB). A survey conducted by European Parliament in 2018, concludes that the ECB has gained increasing public support since 2013. Although recent polls show the positive support for a single monetary policy, COVID-19 places this sentiment into question. COVID-19 has economically damaged many nations in the European region and arguably more so nations that have the Euro as their national currency. 

The future of the EU as a whole was unknown when Great Britain formally left the Union and is a deeper mystery with COVID-19 added to the mix. Although a different institution, the Eurozone faced challenges and obstacles that needed solutions. The Eurozone addressed issues that came before and after the pandemic.

A History of European Monetary Cooperation

Before the ECB was created and adopted by its initial members, the Economic and Monetary Union (EMU) was established in 1990 by the central bank governors of European countries to promote coordination among central banks and economic convergence between nations in the region. The implications behind regional integration and economic convergence were both economic and political. 

Economically, regional integration alleviates any challenges that stem from the flow of commodities, services, capital and/or labor. Economic convergence of developing European countries combined with their connectedness to European superpowers like France and German would increase the economic growth of the region by increasing the opportunities of trade and investments. Additionally, coordinating macroeconomic policies reduces the probability of countries falling into economic recessions but also the capability to recover quickly from a crisis in the likelihood that one occurs.

Politically, with the fall of the Berlin Wall and Soviet Union occurring less than ten years prior, regional integration was a large step towards strengthening liberal ideologies in the international order. Economic regional integration was also a political move that attempted to deter the re-emergence of communist powers by not only connecting small developing countries with powerful liberal countries but also helping in their development. At the time when the EMU was first created, it was vital that the implementation of a singular currency and monetary policy for a group of nations was done through a slow transition thus easing countries into high levels of integration rather than abrupt quick transitions that are short lived. 

The work of the Economic and Monetary Union is primarily categorized under three stages that laid the foundation for the euro currency to be used across states The policies or measures implemented at each stage brought member countries one step closer to regional integration which is reflected in the final stage of the EMU by fixing the exchange rate and creating a singular monetary policy for all member states  to follow. These policies that are still seen in the main objectives of the ECB are known as quantitative easing which result in a more open economy that makes borrowing money from banks easier. In theory, if the lasting effects of quantitative easing stimulates a national economy, expanding quantitative easing policies to a group of member states within the same region should stimulate economic growth on a larger scale. Given the hypothetical benefits of easy business exchanges over a group of several states, coordination of monetary policies needed to be done at every stage to ensure the success of the ECB.

Different measures implemented within each stage center around the theme of coordination. For the eurozone, coordination is the most significant form of diplomacy that determines the functionality of the institution. Without the coordination of monetary policies as well as other policies such as labor and capital movement, the eurozone would not operate as smoothly as it has so far. This form of coordination seen in the region produces a level of regional integration that stretches.

The Functions of the ECB

Despite having a singular monetary policy, the ECB can maintain cooperation and coordination through different frameworks which either consult or decide what is the optimal monetary policy for the region at a given time. More specifically, monetary policies which are under the responsibility of the ECB are establishing the value of the currency and interest rates. Overall these policies affect the supply of money, foreign exchange rate as well as the rate of different forms of investments. As a collective of national central banks, there are three primary bodies which are each delegated the responsibility to make some form of decision. The governing council is recognized as the highest body within the ECB that analyzes recent economic and monetary developments to determine if interest rates or lending rates need to be changed. In total there are 25 members in the Governing Council which include the 19 central bank governors of the eurozone as well as six members which make up the second governing body which is known as the Executive Board. The primary responsibility of the Executive board is to handle the daily operation of the ECB. The last operating body of the ECB is known as the general council which is composed of the central bank governors of all central banks in EU countries. As this position is made up of governors of non-eurozone banks, this council acts as more of an advisory council to the other two governing bodies. At different points in time, these three governing bodies have come together to properly address economic crises both on a national and global level.

Structurally, one way the ECB has responded to national and global economic shocks has been through the creation of resolution mechanisms that are to further aid and supervise the central banks of ECB member states in central bank operations and also oversight to macroeconomic policies. These mechanisms were created with the hopes for member states to equitably benefit from being in the eurozone.

The First Decade of the ECB

Positive results can be seen within the first decade of the ECB. With much action from the ECB being inspired by the work of the German Federal Bank, the ECB was able to maintain an inflation rate at a maximum of 2%. Policies that drew upon the unorthodox approach of economic and monetary policy, caused for the economy of the region to grow at an especially high rate. The low inflation rate that was maintained throughout the first decade mitigated the risk of increasing prices that were affected by high global oil prices. Even during global economic shocks, consistently low interest rates increased countries’ capabilities to lend more from other countries. Smaller economic shocks which occurred in the early 2000s, pushed the Executive and Governing Council to create forms of buffers that would act as safety nets in case of different shocks. 

While in the short run, increased borrowing could be beneficial and finance different projects and programs, but this rate of borrowing is sustained for an extended period, specific monetary policies could make national economies vulnerable to financial crises. Tight and regulated fiscal policy is an optimal strategy for countries to upside the possible risks towards financial crises. Even in the early years of the ECB, the need for a disciplined fiscal policy was acknowledged but the global financial crisis placed extra significance on the notion of the regulated fiscal policies. In total, member states in the ECB saw positive benefits within the first decade but the global financial crisis ultimately determined the success of the European Central Bank for the second decade of its existence. 

ECB’s Shortcomings: a Case Study of the Greek Financial Crisis

It is worth noting that the European Central Bank only requires monetary policy to be uniform through member states. The creation of fiscal policies, on the other hand, is left to the discretion of national governments. Among member states, there is minimal to no coordination between fiscal policies which raises issues that challenge the efficiency of the ECB. Due to fiscal and monetary policy in combination affecting overall economic activity of the economy, the lack of coordination for fiscal policies can cause some countries to be restricted in the event of an economic shock. The Grecian financial crisis which began in the late 2000s was so severe due to the restrictive ability to change monetary policy and the lack of discipline for fiscal policy. Although fiscal policies could help member states recover to some extent, intense policy intervention is needed for economies to sustainably recover from shocks. National financial crises like the Greek financial crisis emphasized the significance of fiscal policy coordination between the member states of the ECB. 

The origins of the Greek financial crisis can be dated back to the 1980s when Grecian fiscal policies surrounded the expansion of increasing government spending and borrowing. When Greece entered the eurozone and ECB, implementing ECB quantitative easing policy combined with their own fiscal policy made Greece a country that was perceived to be a safe place to invest in and could easily borrow money from other countries. Greece’s membership in the ECB increased competition for German goods and deepened their inability to pay off their debt. Since Greece maintained their fiscal policy up until the global financial crisis, the low inflation rate established by the ECB restricted Greece from changing monetary policies that would better alleviate some of the crisis they are placed in. 

As mentioned earlier, the ECB was structurally inspired by the German Federal Bank given that they were the most powerful bank at the time. As a result of their power, much of the monetary policies created were influenced by the state of Germany’s economy. In the context of the Greek financial crisis, ECB monetary policies based on the state of Germany’s policies created tensions between Greece, the ECB and Germany who were divided on how the ECB should respond to the financial crisis. Greek believed that the ECB should forgive some of their debts while Germany was hesitant in debt forgiveness and changing monetary policy for Germany. The tensions between these three actors extended to the point where Greek almost left the eurozone and ECB due to the lack of sympathy from the ECB and large eurozone lenders like Germany.

In total, there are three major critiques that affect the effectiveness of the ECB. The first critique of the ECB was previously mentioned was the lack of fiscal policy coordination among member states. The lack of fiscal policy coordination partially makes fiscal policy coordination less effective. The second major critique of the ECB is the large role Germany has influence over the monetary policy of the ECB. As a result of this, it places states at different economic levels than Germany to be subjected to monetary policies that Germany would benefit the most from. The third critique is the confidence in quantitative easing. Since its inception, the ECB has placed great confidence in quantitative easing monetary policy. The ideology behind having constant quantitative easing monetary policy does not necessarily benefit the regional economy in the long run.

Policy Recommendations

Given the three large critiques that impede upon the efficiency of the ECB, reforms which would focus on a significant theme of coordination. Better coordination across different policies that within and outside of the responsibilities of the ECB will not only promote the founding theme of regional integration, but will also evenly distribute the benefits of a single currency across different member states. Proposed recommendations are catered towards the two significant bodies of the ECB seeing as they make much of the significant decisions for the eurozone.

Irish and British Relations post-Brexit

When former Foreign Secretary Boris Johnson succeeded Theresa May as British Prime Minister in July of 2019, his first commitment to the House of Commons was to fulfill the October 31st Brexit deadline regardless if there was a deal or not. Four months later, instead of this promise being met, British Parliament has until January 31, 2020 to agree upon a deal that will be approved by the European Union (EU). While members of Parliament still hold contention regarding proposed provisions in Johnson’s revised Brexit deal, a subject in both May’s and Johnson’s plan that has held constant significance is the role of the Republic of Ireland and the counties in Northern Ireland that are a part of the United Kingdom. 

The long history between the three regions that lead to the thirty-year period of political turmoil known as “The Troubles” resulted in the 1998 Good Friday Agreement. Although this tension can date back to the 12th century, the major key players of these tensions were the nationalist and unionist parties. A significant point in the history of the two feuding parties was the Government or Ireland Act implemented shortly after the Irish War of Independence. This act allowed Northern Ireland to operate as a self-governing region that was a part of the United Kingdom and not the Republic of Ireland. 

The divide between the two opposing groups was also visible in the political parties that dominated the political landscape of Northern Ireland. More specifically, the Ulster Unionist Party, a political party that was mostly comprised of Protestants,  instilled different measures to ensure that local political power would remain within the party. Some of these measures included gerrymandering and discrimination against the nationalist individuals. The individuals that were discriminated against attempted demonstrations fighting for equal rights, which quickly escalated by bringing  different military forces into the picture in an attempt to try and stabilize the situation. The presence of three different military forces, the Irish Republican Army, the Irish National Liberation Army, and British Army within the conflict zones of the border only deteriorated the issues regarding  injustice interments and shootings. 

After almost 30 years of political turmoil between these two areas in Ireland, a peace agreement was reached in 1998 which declared the northern counties of Ireland to be a part of the United Kingdom unless there was a majority vote to reunify the two areas. All of the provisions written into the agreement primarily established an equitable government that would prevent things such as gerrymandering from occurring and created institutions that work to foster peace and cooperation between Northern Ireland, the Republic of Ireland, and Great Britain. 

The specific provisions of the 1998 Good Friday Agreement allowed for Northern Ireland to remain a part of the United Kingdom and coexist peacefully with the rest of the public. The agreement has four main pillars which politically establishes the rule of law for Northern Ireland and how for the northern counties interact with each other. The four main pillars are the following; devolution, power-sharing, designation, and a three-strand approach to dealing with peace and cooperation. Although there are other provisions enumerated within the agreement, all of them address  the central theme of peace where the government of Northern Ireland will constitute a power-sharing system. This means that  there are two ministers, one from each of the dominating political parties. In addition to top officials needing to identify with a specific political party, all members of parliament must identify with some political to ensure equality. This is another rule to ensure that all members of parliament remove any form of policy that could disenfranchise a group of individuals. 

Additionally, another important provision worth mentioning is the demilitarization of the border towns of the northern counties such as Londonderry/Derry. Heavy militarization occurred within these towns between all military fronts. Finally, the last two significant provisions of the Good Friday Agreement centralized on creating institutions which foster cooperation among the feuding regions. Institutions such as the British-Irish Council and the British Irish Intergovernmental Conference are just some of the institutions that were created from the agreement to ensure there is cooperation between all three parties. 

With both Great Britain and the Republic of Ireland being members of the European Union, there is no border or border checks  between the Republic of Ireland and northern counties that are a part of the United Kingdom. As members of the European Union, the benefits stretched beyond economic and political integration. In terms of the Irish and Northern Ireland conflict, EU membership indirectly promoted cooperation between the two regions. One way the benefits of both areas being a part of the EU is reflected through the border between Northern Ireland and the Republic of Ireland. The lack of distinctive border between the two regions allows for goods and services to be easily transported. To place this into perspective, the border between Northern Ireland and the Republic of Ireland, a border that was once highly militarized, is now a soft border that has no militarization but instead, a simple sign which states that you are either entering or leaving a specific area. The lack of a border allowed for the process of reconciliation and peace to go at an accelerated pace. Economically, the lack of a border has lead to economic integration and benefits. The lack border has allowed for trade, businesses and labor to move very freely between Northern Ireland and the Republic of Ireland. Much of the progress made, however, could be destroyed under new provisions put forth by Johnson in his proposed Brexit deal.

With the likelihood of a deal being reached by the extended deadline of January 31, 2020, provisions regarding the border between Northern Ireland and the Republic of Ireland will jeopardize both the political cooperation between Ireland and Northern Ireland but the economic relations between Great Britain, Northern Ireland and the Republic of Ireland. In the original Brexit deal created by May, there would be no barrier between Northern Ireland and the Republic. This lack of any form of border allowed Great Britain to have a very close relations with the republic of Ireland without the supervision of the European Union. In Johnson’s edition of the Brexit plan, a customs and regulatory border would be established between Northern Ireland and Great Britain, which means that goods from Great Britain entering Northern Ireland would be subjected to EU import taxes. Overall, provisions within the new Brexit deal do not fully take into account significant provisions that were made in the Good Friday Agreement.

Policy Recommendations

In order to maintain the peace that was built between Northern Ireland and the Republic of Ireland, there should be increased conversation between three general players: the British Parliament, the Northern Ireland Parliament and the Republic of Ireland. When considering the thoughts of any amendment to the new plan, having the voice of both Northern Ireland and Irish ministers present within these meetings will ensure that the values behind the Good Friday Agreement are upheld and not jeopardize. It is crucial for the voice of both Northern Ireland and the Republic of Ireland to be present because if not the alternative possibilities which undermine the  Good Friday Agreement could destroy the decades of work for Northern Ireland and the Republic of Ireland to be cooperating under one island. 

Aren’t We Forgetting Something? Brexit’s Impact on International Development

On June 23, 2016, a referendum was held to decide the United Kingdom’s (U.K.) membership to the European Union (E.U.). This resulted in 51.9 percent of voters opting to withdraw from one of the largest political unions in the world. Since then, news headlines, politicians, and analysts alike have vacillated endlessly, existing in a vacuum of uncertainty and doubt as the intricate relationship between the E.U. and U.K. unravels.

Among the countless documents and political statements considering the implications of Brexit, perhaps most notable is the relegated status of international development policy as a priority in Brexit negotiations. While it’s easy to become lost in the widening sea of proposals and policies, we should look beyond the reductionist analysis of the E.U.-U.K. relationship and focus instead on its ramifications for global development.

Forget Article 50: U.K.-E.U. Relations Before Brexit

Before delving into a complete analysis of E.U.-U.K. dynamics, it’s important to examine their past relationship to inform current and future implications of collaboration in the development sphere.

The U.K. is legally obligated to spend at least 0.7 percent of its gross national income in foreign aid. It has done so for the past 5 years, becoming one of the largest major donors in Official Development Assistance* (ODA) terms. In the 2018 U.K. Government report examining the U.K.’s contribution to the E.U., it was estimated that the U.K. channeled $1.9 billion of ODA through E.U. institutions. This amounts to approximately 11 percent of all U.K. aid. These institutions included instruments such as the European Development Fund (EDF), an extrabudgetary apparatus designed to provide development aid to African, Caribbean, Pacific countries (ACP) and additional overseas countries and territories. The U.K. was the third-largest donor to the EDF, making up about 15 percent of the fund. The two main sources of E.U. ODA funding are the E.U. budget and the EDF. Approximately 12 percent of the E.U. ODA budget was from the U.K. 

The E.U. and U.K. have been what Mikaela Gavas, Senior Policy Fellow at the Center for Global Development, called “multipliers for each other’s development policies.” A symbiotic relationship predicated on sharing closely aligned development priorities, the E.U. offered the U.K. access to its extensive global presence—such as in fragile states—while the U.K. created an E.U. “development surplus” through its financial contributions, technical expertise, and experience.

U.K. collaboration with the E.U. considerably reduced transaction costs in implementing aid for the U.K. Department of International Development’s (DFID). Instead of expending resources to develop and administer aid, the U.K. could use the E.U. and its mechanisms to reduce costs and enter regions not always accessible for non-Member States. For example, according to a Bond report by Simon Lightfoot et al., the E.U. is present in all 43 fragile states while DFID only has projects in 11. 

Acting as “economies of scale,” E.U. institutions acted as an effective channel for U.K. aid to influence and achieve development policy objectives. One instance of this is the U.K.’s involvement with the E.U.’s European Civil Protection and Humanitarian Aid Operations (ECHO).

ECHO, the European Commission’s (EC) department for overseeing humanitarian aid and civil protection, is the world’s third-largest humanitarian aid donor. Its global reach includes more than 40 countries, including countries in which DFID has limited field presence in as well as U.K. priority countries, such as Somalia. U.K. financial contributions composed approximately a fifth of ECHO’s budget, enabling the U.K. to wield significant power and influence on one of the world’s leading humanitarian donors.

In examining the relationship in the converse, in which the E.U. funds the U.K., a 2017 Bond report found that the U.K. was the second-largest recipient of E.U. aid to Civil Society Organizations (CSOs). CSOs are organized civil groups that can include entities such as non-government organizations or faith-based organizations. Between 2012 and 2016, E.U. development and humanitarian aid contributions to U.K. CSOs averaged approximately €300 million each year. In 2017, British NGOs received the equivalent of $258.4 million in new grants from ECHO, amounting to about 28 percent of all NGO funding allocations by the E.U. In the wake of Brexit, CSOs will likely face considerable financial shortfalls, limited access to programs in the Least Developed Countries (LDCs) and Highly Indebted Poor Countries (HIPCs), and a diminished ability to influence development policy and participate in partnerships across the 140 countries the E.U. is present in.

The E.U. is the world’s largest donor, providing about half of all global aid, and is a leader in international development. Because of its collaboration with E.U. development institutions, the U.K. had extensive access to the E.U.’s financial instruments and the opportunity to affect E.U. development policy, programming, and direction. On this, Dr. Sophia Price, Head of Politics and International Relations at Leeds Beckett University, argued that U.K. membership in the E.U. “allowed the U.K. to magnify the impact of its aid and influence E.U. development policy to align with its objectives.” However, despite the mutually beneficial nature of E.U.-U.K. cooperation, the prospects of current or future collaboration remain decidedly undecipherable.

How’s Brexit Going? The E.U.-U.K. Relationship Currently

The deadline for Brexit is currently October 31, 2019. While the E.U. has granted the U.K. a six-month extension, leaders have insisted that the U.K. must choose to ratify the exit treaty, opt for a no-deal Brexit, or cancel its departure. 

Throughout the chaos, the U.K. Government has indicated a continued willingness to collaborate with E.U. aid, whether by a cautious “case-by-case basis” or by partnering with E.U. development and external programs and instruments. According to remarks made to the House of Commons by former Secretary of State for International Development (SSID) Penny Mordaunt MP, the U.K. will continue to contribute funds towards the outstanding E.U. budget for 2020. However, she stated that the U.K. “will stop funding in the way [they] currently do in 2020.” In the most recent publication on a future relationship between the U.K. and the E.U., the U.K. Government proposed a cooperative accord allowing for U.K. participation, including allowing U.K. CSOs access to deliver E.U. programs and apply for funding.

Despite DFID’s keenness to continue collaborating with the E.U., many fear the same fate for U.K. CSOs that happened for Swiss NGOs: being no longer eligible for funding since the U.K. is a non-Member State. With a Brexit deadline approaching and little additional information about their status, NGOs have either stopped or scaled back their bids. In response, DFID has committed to underwriting U.K. NGOs if there’s a no-deal Brexit. This promise applies only to ECHO bids and does not apply to funding through the Development and Cooperation Directorate General (DEVCO), which is responsible for creating international cooperation, development policy, and delivering aid. 

The U.K. has suggested that the E.U. offer flexible aid instruments that are open to non-Member States. However, the E.U. has not indicated a willingness to design such mechanisms. Instead, it has proposed an extensive structural reform of its development instruments and funds for its long-term budget (2012-2017). It has also called for a reconsideration of its partnership with the ACP countries--typically funded by the EDF--as enumerated under the Cotonou  Agreement. The proposed Neighborhood, Development, and International Cooperation Instrument (NDICI) would merge at least nine separate development instruments included in the current budget and incorporate components of the EDF. Proponents argue that this reform would create a more efficient development instrument, avoid the complex tangle of hybrid programs, and replace values-driven development with needs-based policies.

However, critics of the proposal, such as Oxfam, believe the new instrument was designed to “promote the E.U.’s short-term domestic interests in mind…[and] risk[s] undermining long term sustainable development” and collaboration with non-E.U. actors. Countries that usually receive aid from the EDF may experience decreased funding or a change in relations with the E.U. It’s important to note that the NCIDI proposal does include the caveat that various actors from within or outside of the E.U. may have access to the NDICI’s funds and programs. However, there is no reference made to arrangements for non-E.U. countries in the management of those programs.

The current status of U.K. development policy and E.U.-U.K. cooperation remains uncertain. Additionally, the political landscape of the U.K. has drastically changed since the referendum, creating even more confusion. 

Boris Johnson was recently elected as Prime Minister (PM) following the resignation of Theresa May. Though there is doubt regarding the longevity of PM Johnson’s tenure, his appointment makes it likely that ODA spending is likely to be diverted from DFID. Johnson has been an outspoken aid skeptic and critic of U.K. development efforts, espousing that aid should “do more to serve the political and commercial interests of the country.” While using the foreign aid system as a vehicle for geopolitical interests is certainly not a novel concept, Johnson’s statement signals a marked departure from previous positions.

PM Johnson recently named Alok Sharma as the U.K.’s latest Secretary of State for International Development, alleviating concerns that DFID would have been incorporated under the Foreign and Commonwealth Office. Sharma opposed Brexit and is a newcomer to the development world; little is known about his ideological position on U.K. aid beyond his support for the U.K.’s 0.7 percent of GNI commitment.

What are the Alternatives?

Many have suggested proposals for post-Brexit cooperation that seek to limit the losses on both sides. One of these is the notion of joint programming, which is when the E.U. works with external development partners to create and implement programs. This would allow the U.K. to leverage the expertise of the E.U. and Member-States while also effectively mitigating the financial and technical expertise shortfalls the E.U. would be experiencing. However, this would increase the U.K.’s cost of administering bilateral funds and the U.K. would only have status as a third-party country, wielding a significantly lower degree of influence.

Another option is for the U.K. to pursue the E.U. aid delivery mechanism called delegated cooperation. This is a process in which the E.U. entrusts funds to a Member-State or third-party donor that has special geographical or technical expertise. They would be then allowed to lead and implement a project. Again, this would increase the U.K.’s administrative and implementation costs and diminish its influence on overall E.U. development policy.

Some have supported the Norway or Swiss model of cooperation with the E.U. Both are non-Member States but are part of the European Economic Area (EEA) and benefit from structural funding. However, a caveat that withers in the face of political realities makes this an almost impossible option: the U.K. would be required to be a member of the European Free Trade Agreement (EFTA). Alternatively, it must negotiate an amalgam of complex agreements with the E.U. similar to Switzerland.

An EEA membership means that the U.K. would be able to make substantial contributions to the E.U. budget. However, it would be required to follow certain E.U. rules and laws, such as the essential “four freedoms”: unrestricted movement of individuals, goods, services, and capital. This is likely not politically maneuverable in the U.K., as distaste for such commitments contributed to Brexit in the first place.

The Future for Development Under Brexit 

In examining Brexit’s implications for DFID, former SSID Rory Stewart suggested that there would have to be careful consideration of what to do with the 11 percent of U.K. ODA—“Brexit dividends”—that was previously allocated through European mechanisms. As Lightfoot et al. anticipates, aid allocation could follow an alternative pattern, moving through the private sector and to organizations with less experience in the development field. As predicted by a study commissioned by the European Parliament, U.K. aid previously channeled through E.U. institutions would likely only be dedicated to British bilateral programs and economic infrastructures, negatively affecting social infrastructure and humanitarian development. Both predictions would follow a pattern paralleling Johnson’s statements.

Depending on the political landscape, U.K. development policies could either be completely internalized to promote more domestic-oriented goals or follow a “European-like” pattern, in which aid follows the same distribution methods pre-Brexit. The latter is unlikely, as Johnson’s new cabinet houses numerous outspoken critics of aid, such as new foreign secretary Dominic Raab and new House leader Jacob Rees-Mogg.

On the challenges of Brexit, the European Parliament found that it’s likely that the secession could either force the E.U. to wield more localized regional influence or hinder its path in becoming a global leader. Unless the E.U. compensates—both quantitatively and qualitatively—for the loss of Britain’s contribution to E.U. aid, it risks cutting 1 percent to 4 percent of ODA in countries throughout Eastern Europe and Northern Africa. Perhaps most importantly, global aid may decrease by up to 3 percent as both the E.U. and U.K. experience considerable reductions in funding and expertise.

Simon Maxwell, chair of the European Think Tanks Group, observed that E.U. development policy is likely to be “less poverty-focused” post-Brexit. A majority of the E.U. budget is spent addressing the needs of middle-income countries (MICs) while lower-income countries (LICs) are typically funded by the EDF. If the 2021-2027 budget incorporates parts of the EDF while pivoting to geographical development instruments over thematic ones, more aid money will likely be spent in MICs instead without the U.K.’s voice in policy decisions.  

Recommendations

U.K. aid and influence in the development sphere would have been most effective in the context of the E.U. Because reentering the E.U. is unlikely, recommendations must instead focus on the best strategies for U.K. development efforts post-Brexit.  

The U.K. should not withdraw from the E.U. without an agreement in place.

With the current political climate swirling around empty statements and puzzled MPs, it’s in the U.K.’s best interest to establish new economic and political alliances beyond Europe. While it’s important to maintain financial commitments to E.U. aid programs and instruments, the U.K. should focus on alternative multilateral institutions to channel their ODA, such as through the World Bank. The U.K. has signed several continuity agreements attempting to replicate preferential access in the case of a no-deal Brexit. Countries such as Ghana and Cote D’Ivoire, however, have not signed agreements. The U.K. should continue these efforts to mitigate the costs Brexit will entail for the U.K. and other countries.  

A no-deal Brexit could cause a weakened U.K. general import regime, devaluation in the British pound, and a decrease in GDP compared to current levels. Uncertainty in the economic system already endangers key development initiatives in LICs and will crystallize if a no-deal Brexit occurs. The government should revise its recently announced temporary tariff schedule in the event of a no-deal Brexit. The current schedule will lower tariffs for a larger pool of countries, injecting competition in developing markets and endangering the preferential access that some countries enjoyed.

E.U. funds for Asia, Northern Africa, Eastern Europe, and Latin America are what is at stake in Brexit negotiations. DFID should work to ensure that U.K. CSOs are eligible as direct contractors and can participate in the creation and administration of E.U. development programs beyond LDCs and HIPCs. DFID should strengthen its promise to underwrite contracts for both ECHO and DEVCO in the event of a no-deal Brexit. If unable to do so, the inability for CSOs to continue to bid or participate in development programs endangers global humanitarian efforts.

There remains uncertainty regarding ACP-E.U. relations and the 2021-2027 Multiannual Financial Framework (MFF), which would create the NCIDI. Because of what the E.U. has categorized as  “institutional evolution and a continuous shift in the balance of powers,” simple renewal of ACP-E.U. relations is not an option. The E.U. is seeking to shift focus away from the ACP and EDF, creating a significant opportunity the U.K. should take advantage of. The U.K. should circumvent ACP-E.U. collaboration and instead reform its relationship with African, Caribbean, and Pacific countries and other overseas countries and territories.

Boris Johnson’s shift towards bilateral aid programs narrowly framed under commercial agreements that focus only on economic sectors and infrastructure is a poor policy decision. It’s a position that endangers current and future initiatives that attempt to address the diversity of global issues inherent in international development. This policy approach should not be adopted nor should it guide U.K. development objectives. 

Perhaps most significantly, the U.K. should not relinquish its influence in determining the trajectory of the E.U. for the next several years. Instead of abstaining from important policy decisions, the U.K. should increase its presence. While domestic and international political realities limit the U.K., it should work to insulate itself from the instability that Brexit poses. Instead of adopting a diminished role in the debate on the E.U.’s MFF and renegotiations for the ACP-E.U. partnership, the U.K. should leverage its influence to create an environment conducive to its development objectives post-Brexit. If they are unable to do so—or refuse to do so—they risk finding themselves to be what former Chair of the European Parliament Development Committee Linda McAvan characterized as “outsiders and another kind of lobbyist out here.”

Conclusion

Brexit poses substantial ramifications for international development—ones that have been largely ignored in debates. Besides working outside of E.U. mechanisms to mitigate the costs of Brexit in development terms, it’s important to recognize that the E.U. is the largest major donor in the world. Even if there was an option to circumvent the organization, doing so would be incredibly detrimental to the U.K.’s impact in development, whether through programming, expertise, or influence.

When considering cooperation with the E.U. in international development, the U.K. should attempt to foster the softest Brexit deal, adopting strategies mentioned previously. This should include a series of agreements between the E.U.-U.K. that will perhaps be more complicated than its present relationship already is. Simply put, when it comes to international development, there is no alternative.

*The Organization of Economic Cooperation and Development defines Official Development Assistance as financial flows that are undertaken by the official sector (state and local governments, including their agencies). These efforts must have the main objective of promoting economic development and welfare. The financing terms must be concessional, such as the World Bank providing a loan below market financial terms or incorporating a grant element.

Note: This article only examines the dynamics of the E.U.-U.K. in the development sphere and the best ways to mitigate the costs of Brexit. As such, it does not seek to analyze the impact and nuances of development practices or policy. It consequently does not comment on the ethical or political considerations of international development and aid. For example, some criticize foreign aid regimes as an extension of neoliberal policies (see Margaret Thatcher’s infamous quote referred to in this article: “There is no alternative”) that lead to the crystallization of inequality while maintaining neocolonialist tendencies. That is a subject in and of itself and one that cannot fully be addressed in the context of this article.

Brexit: The Mess That Could Set Back Years of UK-Ireland Progress

All of us are getting news notifications on our phones and computers, almost on a daily basis, on Brexit and the issues surrounding the exit deal. But what actually is Brexit and why does it really matter?

In a June 2016 referendum, voters in Britain, Wales, Scotland, and most parts of Northern Ireland chose to leave the European Union in a close vote of 51.9 to 48.1 percent. The European Union (EU) is a political and economic union of 28 member states located primarily in Europe that works to promote stability and economic cooperation between its member states. Since March 2017, the United Kingdom and European Union have been engaged in negotiations on the terms of the UK’s exit and the future of their relationship. One of the main challenges to finding an agreement on a final deal has been meeting the requirements of Northern Ireland’s unique circumstances.

The UK is currently part of the EU’s customs union and single market. The customs union is a principal component of the EU. There are no tariffs or non-tariff barriers to trade between members of the customs union, and members states impose a common external tariff on all goods entering the union.The single market is made of the 28 EU member states and seeks to guarantee the free movement of goods, capital, services, and labour. After Brexit, the UK will leave both the customs union and single market.

This will raise questions about the status of the Irish border, particularly whether or not the border will become a customs border with all the associated checks and controls that come with that title. A customs border is a border control that checks any items and goods crossing the border, where taxes or tariffs could be imposed.This will most likely create practical and economic challenges and could reverse relations between the US and Ireland and all the progress that has been made in recent years.

The border between Northern Ireland and the Republic of Ireland was a source of major conflict and violence between the two countries. When the Republic first split from the UK and Northern Ireland, the border line was insignificant. However, after some time passed, hostility between the UK and Ireland resumed. As a result, the UK established customs checks at the border. The two countries eventually entered into a trade war and tariffs were placed on agricultural produce, steel, coal, and other things. By the late 1960s, this trade war turned violent. Conflict broke out in Northern Ireland between nationalist militaries (like the Irish Republican Army) who believed that Northern Ireland was rightfully part of Ireland and the British were oppressors; and as such, there should be no restrictive border between the two states. Ireland's Nationals population unionist militaries fought back to defend their place in the UK. Both groups brought violence to the streets by blowing up buildings and setting off car bombs, among other things.

The UK deployed thousands of troops to Northern Ireland during his time, who became a common target of nationalist attacks. A lot of these attacks occurred at the border of Northern Ireland and the Republic of Ireland, which for nationalists was the ultimate symbol of British occupation. The UK military secured the borderline with walls, towers, guns, and patrols. They controlled the 20 official border crossings with an iron grip and screened all people and vehicles crossing the partition. The conflict in Northern Ireland turned this into a hard border. The violence lasted for more than 30 years and killed over 3,600 people. This period of time is most commonly known as the “Troubles”.

The Good Friday Agreement, signed in 1998, brought an end to the conflict and established power-sharing in Northern Ireland. The agreement gives EU membership to the UK and Ireland, while also creating an understanding for the UK and Irish governments to cooperate on EU matters. The Good Friday Agreement also allows people born in Northern Ireland to choose either Irish citizenship, British citizenship, or both. The UK has stated that it wants this option to continue after Brexit. The agreement also established special EU funding programmes, known as PEACE, to reinforce the peace process and support cross-community projects. It also created the North South Ministerial Council (NSMC), which allows the governments in Dublin and Belfast to cooperate in various areas, including agriculture, education and transport. The UK, Ireland, Northern Ireland, and the European Commission have all agreed that the withdrawal process cannot undermine the Good Friday Agreement.

Once the UK leaves the EU, the only land border will be the 310-mile line between Northern Ireland and the Republic of Ireland and decisions will have to be made on how to manage the movement of people and trade across that border. The UK, Ireland, and the EU have all said they want to maintain the Common Travel Area, which has been in place for most of the period since the establishment of the Irish Free State in 1922. The CTA allows free movement of British and Irish citizens between the UK, Ireland, the Channel Islands, and the Isle of Man. The agreement also gives access to various government services in each country. Ireland will continue to allow free movement for citizens in the other EU countries, while the UK is thinking about an inland control approach. Through access to labour markets and social security, the UK will enforce immigration policy without requiring checks on people crossing the Irish border. This move would greatly affect and possibly lead to the breakdown of the CTA.

The UK, Ireland, Northern Ireland and the European Commission have also all agreed there should be no hard border between Northern Ireland and the Republic, for trade as well as people (European Commission Joint Report). The UK’s decision to leave the EU Single Market and Customs Union means that it will become a “third country” to the EU, creating a land border between the UK and the EU. This is the border between Ireland and Northern Ireland and if no arrangements are made for the Irish border, the EU will have no choice but to put in place the standard checks it has at its border with other third countries. These would include both customs checks, documentation of products, proof of where the good originates, collection of tariffs, and regulatory checks, all to verify that goods comply with the EU’s standards.

Last November, UK Prime Minister Theresa May published her original Brexit plan that included an Irish border backstop. The backdrop is an insurance policy to avoid a hard border between Northern Ireland and the Republic of Ireland if the UK leaves the EU without securing a concrete deal. Both the UK and EU agree on the need for a backstop to ensure no hard border returns.

The backstop was the most hotly debated issue in the parliamentary debates on the draft Withdrawal Agreement. The Democratic Unionist Party (DUP) is the unionist and socially conservative party political party in Northern Ireland. The DUP is also in a coalition with May and her Conservative Party in Parliament and they are notably pro-Brexit. In January, however, their 10 MPs in Parliament voted against Prime Minister May’s Brexit Plan. The party has always been against a “special status” for Northern Ireland in the Brexit negotiations, saying any differences between Northern Ireland and Great Britain could threaten to break up the United Kingdom.

To the DUP, the backstop represents everything they don’t want for Northern Ireland: regulatory differences that mean only Northern Ireland would continue to follow some EU rules, no time limit, and the ability to exit the backstop would need to be agreed jointly by the UK and EU. On December 4, 2017, DUP leader Arlene Foster said that the DUP “will not accept any form of regulatory divergence which separates Northern Ireland economically or politically from the rest of the United Kingdom.” Foster also added that the DUP also does not want to see any changes to the current border arrangements between the North and the Republic.

A majority of people in Northern Ireland, however, support the backstop (most likely due to the fact it would give Northern Ireland special access to both the UK and EU markets). In January of this year, the UK government published proposals on how the UK can influence both the decision to use the backstop and its governance if it comes into effect. The proposals also reaffirmed the UK’s commitment that the rest of the UK will abide by the Single Market regulations being applied in Northern Ireland.

Ireland and Northern Ireland also share a single electricity market and electrical infrastructure. Keeping this arrangement will require Northern Ireland to continue to comply with EU regulation, without having any say over their development. If this agreement is not kept in tact, the single electricity market could be reversed, along with any benefits brought about by it. A notice from the UK Government published in October 2018 said if the UK leaves the EU with no deal, electrical supply from Ireland to Northern Ireland could be disrupted.

One of the problems for the Ireland is that its economy is intertwined with the economy in the UK. Currently, around 80% of the goods Ireland exports are transported to the UK or go through the UK. Ireland also sources 41% of its food imports and 55% of its fuel imports from the Britain. According to the Irish Ministry of Finance in October 2016, Brexit “is expected to have a material negative impact on the Irish economy.” A report from the Irish Government also called for “the closest possible trading relationship between the EU and the UK.”

On January 15, 2019 members of parliament rejected Prime Minister May’s Brexit deal by 432 votes to 202 - which is a historic political defeat in Britain. Then on March 12, after Theresa May had gone back to the EU to secure further legal assurances, Parliament rejected the deal again. And March 29, which was the original day that the UK was due to leave the EU, Parliament rejected the deal for a third time. Since Parliament did not approve Theresa May's withdrawal deal in a vote on March 12, May was forced to ask other EU leaders to delay Brexit. They agreed to postpone it until May 22 if MPs approved her deal in a new vote. On March 29, the UK missed that deadline and faced leaving on April 12 instead. But May has now gone back to the EU to ask for another extension - which the EU has agreed to. The new deadline is October 31. However, the UK can leave before then if May can get her deal approved by Parliament. The government will continue talks with Labour to try to come up with a solution. If the two sides do not come to an agreement, Theresa May has said she will propose additional options to members of parliament to work out a future plan.

Peace Walls and a Potential Hard Border: The Continued Struggle for Reconciliation after Northern Ireland’s The Troubles

When you have a conflict, that means that there are truths that have to be addressed on each side of the conflict. And when you have a conflict, then it’s an educational process to try to resolve the conflict. And to resolve that, you have to get people on both sides of the conflict involved so that they can dialogue.

— Dolores Huerta

A small state located above the Republic of Ireland and part of the nearby United Kingdom (UK), Northern Ireland is famous for its violent intrastate conflict during a thirty-year period of political violence known as The Troubles. Internal state conflict, such as the genocide between the Hutus and the Tutsis in Rwanda in the 1990s, often arises due to clashes over group territory, resources, and opposing identities. However, The Troubles was unique in that it was the final culmination of deeply-rooted ethnoreligious sectarian tension between Catholic Irish nationalists who wanted unification with the Republic of Ireland, and Loyalist Protestant unionists who favored the continuation of British rule. Nonetheless, despite the passage of the Good Friday-Belfast Agreement that formally ended the tumultuous conflict in 1998, continued social stratification, political upheaval, and overall uncertainty about the outcome of Brexit further decrease the possibility of successfully reconciling the two warring communities. As long as tension between British and Irish identities remains unresolved, Northern Ireland (NI) will continue to face potentially long-term sectarian strife.

Historical Overview of The Troubles

The seeds of The Troubles are rooted in the early 1600s with the British-supported migration of Protestant “planters” to six counties in the Ulster region of Ireland, then controlled all by Britain, thus allowing for the composition of a mostly Protestant community in NI today. In that same century, England dealt with growing sectarian politics between warring Protestant and Catholic groups who desired to establish control over the throne. This political and religious tension bled into Irish politics, as Protestant migration continued to disrupt the primarily Catholic majority that was already established on the island. In 1921, the Anglo-Irish Treaty officially divided Ireland into north and south and established the southern Republic as a self-governing entity while the north remained part of the UK. To better comprehend what propelled NI into social and political turmoil, the following events must be understood: the Battle of the Boyne and the impact of William of Orange on present-day Irish society, as well as the horrific events of Bloody Sunday.

The Battle of the Boyne was the culmination of extreme tension between the Catholic and Protestant communities, as well as a continuation of the grapple for power and control over the English throne. A struggle between Protestant William of Orange and deposed Catholic King James II, the battle restored Protestant power in England with the victory of William of Orange. Furthermore, the battle was and currently still is seen as a source of cultural and political pride for Protestants in the present-day, who consider it as validation and evidence of their superiority over Catholics.

The social implications of the victory of William of Orange manifest most popularly in the almost sacred annual celebratory march on July 12, otherwise known as Orangemen’s Day, which has major symbolic significance for Protestants who live in Northern Ireland. The Battle of the Boyne’s most tangible effects are seen by its yearly commemorations that are carried out by The Orange Order, a fraternal-like organization that marches to honor William’s valiant efforts to dispose of King James II and to acknowledge him as the sole individual who secured Protestant ascendancy in the country. However, these marches are quite controversial. The route that the Protestants marchers take often comes close to Catholic neighborhoods, sparking further sectarian violence for those who see this public display of victory as a way in which Protestants can blatantly rub in their historical dominance. The marchers also carry with them an assortment of flags and banners, many of which display the Union Jack (the national flag of the UK), as the UK is often seen as the founding state of The Orange Order. This creates more tension between the two communities as the Union Jack is a glaringly obvious symbol of separation, which is in direct opposition to the unified Ireland that Catholics desire. The night before on July 11, or the “Eleventh Night”, is also characterized by violence in the form of immense bonfires set ablaze in Protestant communities that intentionally burn Catholic and other non-unionist symbols. These bonfires are historically known to get out of hand, with some houses and other buildings burning down amidst chants of “No surrender!”

These societal divides continued to deepen as a result of the events that transpired on January 30, 1972, a day that is more famously known as “Bloody Sunday”. Said to be one of the darkest days of The Troubles, Bloody Sunday started out as a Northern Ireland Civil Rights Association (NICRA) march against internment that mirrored the efforts to combat discrimination and prejudice by Dr. Martin Luther King Jr. in the United States. While some marchers stopped at the now iconic ‘Free Derry Corner’, others continued until they reached army barricades and were stopped by the Royal Ulster Constabulary (RUC), NI’s police force at the time. Violence, then an everyday occurrence, soon erupted between the RUC and members of the crowd; the British Army ultimately killed 13 civilians and wounded 14 others. Bloody Sunday was critical in shaping the course of the conflict and fueling the efforts made by the Provisional Irish Republican Army (IRA), the core paramilitary group that aimed to end British rule and reunify Ireland. As a result of the massacre of unarmed protesters that day and the subsequent cover-up by the state, the conflict became increasingly militarized from thereon out, leading to increased IRA recruitment.

Due to the complex nature of The Troubles, it is important to discern which groups and parties belonged to which side of the conflict. Of the Republican paramilitaries involved in the hostility, the most infamous was the IRA, which was responsible for many of the violent attacks that characterized The Troubles. On the Loyalist Protestant side, there was the Ulster Volunteer Force (UVF), the predominantly Ulster paramilitary group, and the Ulster Defense Association (UDA), another large vigilante group. Furthermore, British security forces were involved in the form of the law enforcement-based RUC, as well as numerous activists, politicians, and political parties such as the Democratic Unionist Party (DUP), the primary unionist political party in NI, and the opposing Sinn Féin, the left-wing Irish party that is still active in both NI and the Republic of Ireland.

Ongoing Divisive Issues

Efforts to put an end to the unrelenting conflict seemingly concluded with the formal passage of the Good Friday-Belfast Agreement that was signed by British Prime Minister Tony Blair and Irish politician Taoiseach Bertie Ahern in Belfast, NI in 1998. The terms of the peace agreement included, but were not limited to, the decommissioning of paramilitary groups, the establishment of a power-sharing government split between the DUP and Sinn Féin, the demilitarization of the hard border between the UK and the Republic of Ireland, and the release of political prisoners on the condition that they won’t re-engage with their former organizations. However, while the conditions of the treaty were attractive in principle, deep divisions are still evident within Northern Irish society, acting as roadblocks in the peace and reconciliation process.

While the Good Friday-Belfast Agreement attempted to quell all domestic issues, full implementation of the peace treaty has been challenging as various forms of social stratification remain unresolved due to enduring societal norms and attitudes. While Orangemen’s Day and the Eleventh Night bonfires are merely annual demonstrations of Protestant pride, the persistence of segregation and sectarianism is still visible in the structural layout of many communities in NI, most notably in Belfast and Derry/Londonderry where the infamous ‘Peace Walls’ continue to physically divide Protestant and Catholic communities from one another. These walls, which separate the two communities at contentious intersections in the hopes of minimizing violent interactions, serve as blank canvases for political statements and are decorated in a variety of colorful murals detailing the thirty years of conflict. Common images include messages of revenge and oppression, as well as famous figures such as Bobby Sands, a member of the Provisional IRA and the UK Parliament who died while on a hunger strike in prison and was ultimately seen as a martyr for the Irish Republican cause. However, while these walls are meant to act as peaceful dividers, their mere existence perpetuates an “us versus them” mentality that makes it difficult to reconcile the two communities with one another. Some murals in Derry, where Bloody Sunday occurred, even go as far as to compare the IRA to the Islamic State of Iraq and Syria (ISIS).

In addition to the use of imagery to further the divide between Protestants and Catholics, inequality in unemployment, housing, and education persists. Historically, Irish Catholics have experienced higher unemployment rates and less housing availability than their Protestant counterparts. The disparity was evident in 1992 towards the tail end of The Troubles, as the Protestant unemployment rate was 9% in comparison to 18% for Catholics. While those rates have decreased, dropping to 5% and 7% for each respective group in 2016, this economic inactivity still heavily impacts the Catholic community to a greater degree. In fact, one study conducted by R. L. Miller and R. D. Osborne, drawing upon a government survey that monitored over 3,500 unemployed males during 1976-1977 at the height of the conflict, found that Catholics were “more likely to have been unemployed in the previous three years, for that unemployment to have last longer, to experience a longer period before securing a job, [and] to receive from Employment Offices fewer job submissions… [which] could not be accounted for by variations in education, skill level, geographical mobility or general motivation”. Despite the government’s attempts to level out the playing field, Catholics, namely ex-terrorists, have faced far more social barriers than Protestants in terms of their inability to get public sector jobs, insurance, or even travel to other countries. This pervasive inequality acts as a breeding ground of sorts for paramilitary activity, who view the lack of government intervention as siding with the Protestant community. Furthermore, research conducted by scholars at Ulster University shows that welfare dependency rose, suicide rates doubled, and men’s life expectancy fell in the areas most affected by The Troubles. Ironically these areas, such as Derry/Londonderry in NI, are primarily Catholic.

Pervasive social norms and stigmas have also obstructed the peace process, especially in regards to education. Schooling in Northern Ireland is heavily segregated, and its persistence often fuels the debate that the education system in the state is acting as more of a perpetuator of division than one of peace. With a population of only about 1.8 million, analysis of the fragmented school structure shows that 93% of children in primary school (ages 4-11), and post-primary school (ages 11-18), attend segregated schools that are either majority Catholic or majority Protestant. This blatant academic separation demonstrates the passing of sectarian views through the generations, as many adults who were involved or impacted by the events of The Troubles have chosen to further the divide and hinder the peace process by having their children attend segregated schools. This ultimately limits the opportunity that children and adolescents have to interact with and form their own perceptions of “the other side”.

Political Upheaval

A core component of the Good Friday-Belfast Agreement was the establishment of a power-sharing government in Northern Ireland, commonly known as Stormont, between the mainly Protestant DUP and the Catholic-leaning Sinn Féin. The dynamics of this relationship essentially meant that the two groups both had a say in the political sphere within NI. However, recent events have made it difficult for any progress to be made at all, ultimately leading to the collapse of the regional governing body in NI. In January 2017, Sinn Féin’s leader, Martin McGuinness, resigned as deputy First Minister. The party then let the deadline for the nomination of a replacement pass, which goes against the conditions of the peace agreement, thereby forcing an early election, an action that the DUP saw as Sinn Féin “putting its partisan interests ahead of the public good”. Adding to the divide is the fact that Sinn Féin’s president Gerry Adams stood down in late 2017; this, combined with the death of McGuinness, has left the government in a tricky situation, enough to where the assembly stopped meeting, an overhaul of the region’s health system was postponed, and any and all long-term decision-making processes were ended. The lack of a functioning government has forced the state to run off of the work of civil servants with very limited funds and resources.

Efforts to reinstate a functioning government were attempted in January 2018 with the election of Karen Bradley as Northern Ireland’s Secretary of State. Bradley ultimately got the two political parties to talk and draft a deal that satisfied both sides, however, at the last minute the deal fell through. While the precise reasons are unknown, circulating rumors claim that the deal included the foundations for an Irish Language Act, which would give the Irish language the same power and prestige as English. This is an act that the DUP is in complete opposition to, as it means equalizing the two communities in a way that elevated Irish culture and diminished British identity. As a result, there continues to be no active government in the region to this day.

Brexit Uncertainty

Moreover, Northern Ireland’s persistent challenges are not limited to domestic causes, but they also stem from international disputes, including the uncertainty surrounding “Brexit”, or the UK’s potential departure from the European Union (EU), and the possible political and economic ramifications associated with that decision. Brexit, a contentious issue that continues to plague European citizens, could destroy the little peace that has been achieved in Northern Ireland, as it brings into question the status of the country as a member of the UK. The political ramifications of Brexit are often discussed in relation to the “Irish backstop”, another way to refer to a guarantee that a “hard” Irish border will not be reinstated between the north and south if the UK splits from the EU. During The Troubles, the hard border that existed was known to be especially sensitive to violence, as the soldiers who patrolled it were seen as easy targets and enforcers of British occupation. Complete demilitarization of the border was a key condition of the 1998 peace agreement, but full or even partial reconciliation seems further and further out of reach as the uncertainty of Brexit, paired with the lack of a functioning government, threatens to reestablish the border, leading to immense social and economic consequences.

However, the border is currently viewed as a “tripwire” of sorts, where any slight miscalculation or aggressive action on behalf of either side threatens to open old wounds and reignite the bloody conflict. One of the most recent incidents occurred in January 2019 when a car bomb exploded outside of a courthouse on an empty street in Derry, NI. This violence was seen again in April 2019 when Lyra McKee, a reporter who specialized in The Troubles, was shot and killed during riots in Derry/Londonderry. These types of acts were all too common during the conflict, and demonstrate that violence still persists even to this day and could very easily occur on or near the border if it is recreated.

In terms of its economic impact, Brexit could do a large amount of damage to the British and Irish economies. In an interview in February 2019, Irish Deputy Prime Minister Simon Coveney stated that there are around 40,000 Irish companies that trade with Britain, amounting to almost a 75-billion euro trade relationship. The reestablishment of a hard border could have detrimental effects on that trade relationship, making it more difficult for the two countries to give and receive goods. Furthermore, the European Single Market that was created in 1993 allows for the easy passage of goods between members of the EU, while the EU Customs Union is a club of countries where customs (or tariffs) have been removed from goods. If the UK leaves the EU, then they leave the single market and the customs union. Thus, they run the risk of having NI and the Republic follow two different rules; as a result, all goods would need to be verified when moving between the two countries, requiring border checkpoints, which many see as a potential source of future violence. To mitigate these potential impacts, the EU and the UK created the “Irish backstop” deal as a sort of last resort policy so that there will be no hard border again, allowing for the easy movement of citizens within the island of Ireland.

Issue Recommendations

Building off of the fragile peace that exists requires a three-pronged approach that addresses the social, political, and economic issues that continue to persist in Northern Ireland. This comprehensive approach entails the gradual removal of the ‘Peace walls’ that exist primarily in Belfast, increasing the number of integrated schools across Northern Ireland, reestablishing a functioning government in Stormont with the help of the UK, and preventing the return of a hard border by monitoring the developments regarding Brexit.

The gradual destruction of the walls that divide Protestant and Catholic communities in many cities across Northern Ireland is the first step towards reconciliation. While many view the walls as dividers that actually aid in the peace process because they limit group interaction and therefore minimize violence, the mere existence of the walls promotes segregation. Many of the walls are located in economically disadvantaged neighborhoods, especially in Belfast, and this has caused a lot of disagreement that goes back to the issue of Catholic rates of unemployment and housing shortages in comparison to Protestants. However, demolishing the walls would be the practical first step, but the reality of the situation is much more complex. While the violence may have decreased substantially since the signing of the peace agreement, the walls represent more of a psychological than a physical barrier that provides a sense of stability and protection from the other side. Nonetheless, while not much progress has been made since the goal of tearing down all 48 of Northern Ireland’s peace walls by 2023 was declared, local artists have used the walls as blank canvases to display peaceful images rather than the harsh, sectarian pieces that adorn some sections of the walls. Until more walls come down, artists should be encouraged to spread and promote peace through the use of imagery; for example, the Arts Council of Northern Ireland has formed the Re-Imaging Communities project that gives local community members grant money to create new art pieces that help tackle sectarianism. These “post-para” murals commemorate general “cultural treasures”, such as C.S. Lewis, who was born in East Belfast and is famous for his novel The Lion, The Witch, and the Wardrobe, or George Best, the boy who popularized soccer in the 1960s.

British and Irish cultural differences have also had effects on the education sector; to bridge this division, there should be a focus in Northern Ireland to create more integrated schools that host both Catholic and Protestant students in a comfortable and inclusive setting. At present, there are around 62 grant-aided integrated schools throughout NI, and results from a 2013 public opinion survey revealed that 66% of parents wish to increase the number of integrated places in Belfast from 4% to 33%, and 83% believe that integrated education is a vital part in moving forward in the peace process. New-Bridge Integrated College, an integrated school in Loughbrickland, Northern Ireland, focuses on this narrative of peacebuilding through social cohesion by stressing respect and tolerance for everyone, no matter their background. While these schools face challenges of addressing student questions of culture and identity, the needs of young people for reconciliation and inclusivity in NI should take precedence over parents’ desires for continued segregation. The overall goal should be to combat these negative social norms and attitudes that encourage divisiveness rather than unification.

With over two years since it last had a government, it is pertinent that Northern Ireland returns to having a functioning political system; one of the ways in which this could happen is if Westminster, the UK government that resides in London, steps in and controls NI from afar. While the UK is not quite keen on this idea, continuing without any government only further damages the country and puts a halt on the peace process. Currently, few decisions have been made and little action is being taken to address any issues that plague NI as a direct result of the limited resources and lack of working ministers. Reestablishing a functioning government would essentially help mitigate some of the economic and social issues that citizens face, as well as provide Northern Ireland with more of a voice in the Brexit debate. Ever since Stormont collapsed, concerns over health care in specific have grown, with the Department of Health finding increased wait lists up to 52 days for an initial consultation, staff shortages, and stalled hospital reform to be major sources of concern for individuals who need assistance as soon as possible. With the aid of Westminster, both the DUP and Sinn Féin representatives at Stormont could work together to at least satisfy the basic needs of their citizens and later use Westminster as a sort of third-party mediator to help facilitate dialogue and overcome their differences.

Lastly, in terms of solutions for the politically-fuelled border debate, all efforts should be taken to prevent the re-implementation of a hard border between Northern Ireland and the Republic of Ireland. The border was the site for lots of conflict, and to add patrolmen and physical infrastructure such as cameras, sensors, and drones to monitor movement between the two states is to create easy targets for sectarian violence. The results of a shocking survey, however, found that approximately 60% of the business community in NI were in support of a soft Brexit, including both nationalists and unionists. A soft Brexit means that the UK stays either within the European Single Market by becoming a member of the European Economic Area, the EU Customs Union, or both. The impact of a soft Brexit would, given the limited options, not be a terrible choice, as it would satisfy the interests of all sides by avoiding the reestablishment of a hard border. Nonetheless, as the various governments continue to issue statements regarding the progress of Brexit, and therefore the Irish involvement in that process, the hard border continues to be brought up. To make one single recommendation that would prevent the re-establishment of a hard border is difficult given the complexities of the issue among the parties involved.

The entirety of The Troubles was characterized by sectarian violence, clashes between the police and citizens, and general disagreements over culture and identity that led to the death of some 3,600 people, all of which are common markers of intrastate conflict or a civil war. While the Good Friday-Belfast Agreement formally ended the conflict, it failed to provide any practical recommendations or solutions on how to maintain peace while reconciling the past. Northern Ireland is still fraught with social, political, and economic issues today, making it difficult to work on the peace process whilst also addressing old wounds. The paramilitary violence of The Troubles may have stopped for the time being, but the underlying sectarian and nationalistic views that ignited the conflict continue to persist.

Evolving Unions: Brexit, Scotland, and the British Constitution

The United Kingdom is having an identity crisis. A fast-approaching March 29 Brexit deadline has thrown Prime Minister Theresa May’s government and Parliament into a state of prolonged chaos as Members of Parliament (MPs) from across the ideological spectrum cannot agree on any single direction. On January 15, the House of Commons rejected May’s proposed deal by 230 votes, the largest margin for a government in history. Beneath the surface of procedural jargon and party politics, major existential questions about the future of the UK in Europe continue to cause gridlock and uncertainty. Leaders of the oppositional political parties, mainly the Scottish National Party (SNP) and Labour have suggested a second referendum to reverse course and remain in the EU, though Labour is also internally divided over Brexit. In the daily political circus, an often forgotten issue is the territorial nature of the modern British system beyond the center of power in London and the consequences that Brexit holds for internal divisions within the plurinational union. This article comprises discussion of political contexts in Scotland which contribute to an ongoing Brexit divide, a brief examination of SNP discourses, and a consideration of Brexit’s impact on the territorial British constitution.

Scotland’s independent religious and educational institutions, in addition to a general lack of confidence in Conservative leadership, have shaped a distinctly Scottish political culture and complicated union with the rest of the UK. Scottish institutional representation in British politics was an incremental process throughout the 19th and 20th centuries, with the creation of a largely symbolic Scottish Office in 1885 in response to criticisms that Scotland was neglected by Parliament and civil service. Administrative devolution left a legacy of limited Scottish political autonomy as well as a national identity shaped by such autonomy and nationalism. Politically, devolution of some legislative powers from Westminster arose out of discontent with conservative government policies during the Thatcher era, reaching a turning point in 1997 when Tony Blair’s government held a referendum on the formation of a Scottish Parliament with tax-varying powers. The Scottish Parliament’s purpose was described by McHarg and Mitchell as “a defensive institution, designed to protect Scotland from Westminster Governments that sought to pursue policies opposed by [the] majority opinion in Scotland.” The Brexit outcome and subsequent implementation tests the absolute limits of this balance between devolved Scottish government and Westminster, as the majority opinion in Scotland has been overruled by the rest of the UK in both a political and constitutional sense.

Contrary to the traditional understanding of the British state, the UK is not a unitary state but rather an asymmetrical union of four nations: England, Scotland, Wales, and Northern Ireland. These unions developed over centuries with the English and subsequently British state absorbing Scottish, Welsh, and Northern Irish cultural identities without wholly replacing them. In the 2016 referendum, only England and Wales voted in majorities to Leave the European Union. Leave defeated Remain by a slim 52-48 margin overall whereas 62% of Scottish voters cast their vote to Remain in the EU. Scotland and Northern Ireland both voted in majorities to remain in the EU but have also expressed a desire to remain in the UK; now they cannot have both. The institutional unions between Westminster, Scotland, and Northern Ireland developed differently and gradually due to complex histories, however British internal politics adapted to plurinational unions with relative stability. According to James Mitchell of the University of Edinburgh, the changing relationship between Westminster and the UK’s component nations characterizes the UK “as a state of evolving unions […] Institutions may frame politics but people make choices as to how the institutions operate.” At the heart of Brexit lies this conflict among institutions and identities, processes of union and separation, and, above all, the constitutional adaptability and volatility of the British state.

As a regionalist political party within the parliamentary system, the original purpose of the SNP was to rally political support for Scottish independence. Ultimately, a 2014 referendum settled Scotland’s status as an independent country, resulting in a 55% “No” vote. Since 2014, the SNP’s vision seeks to advance the cultural notion of Scotland as distinct from the London-centric political establishment. As a center-left party, the nationalism encompassed by SNP rhetoric aligns with the EU and opposes the conservative and insular vision of the UK’s role in the European system. In a study of public opinion from the 1979 and 1997 referendums, Seth Jolly found links between pro-EU sentiment across Scotland and greater public support of devolution and independence. European integration is, therefore, a strategic benefit for an independent Scotland’s viability, not only as an institutional arrangement for trade but as an idea, as the EU provides an alternative to Westminster rule and traditional notions of English hegemony. This strategic relationship between Scotland and the EU is still a focal point for the SNP in the current Brexit debate.

The most principal actor in the formation of Scottish political discourse is First Minister Nicola Sturgeon, Theresa May’s counterpart as the leader of the Scottish Parliament and figurehead of the SNP across Scotland. Sturgeon has recently utilized her public platform to make clear that Scottish interests are not taken seriously by other UK political parties, therefore a renewed consideration of Scottish independence (in addition to a second Brexit referendum) should stay on the table post-Brexit. In a foreign visit to the United States in February, Sturgeon gave a speech on Brexit at Georgetown University’s Institute for Women, Peace and Security:

Scotland has a very proud European tradition. We see ourselves as a European country and people in Scotland by and large, perhaps in contrast with people elsewhere in the UK, don’t really see membership of the European Union as a threat to our own national sovereignty. […] But, amid the confusion and uncertainty of Brexit, one thing I think is clearer than ever. Scotland’s national interests are not being served by a Westminster system which too often treats Scotland as an afterthought, or too often sees our interests as not being material. In my view, they can only properly be served by becoming an independent country. But an independent country that then seeks to play its part in an interconnected world.

Framing Scotland as pro-Europe, culturally distinct from the rest of the UK, and inadequately represented in Westminster is consistent with the scholarly notion of the UK’s asymmetric union as well as the SNP’s political strategy, while the combination of these forces logically leads Sturgeon to steer discourse towards the direction of independence.

Since 2016, Twitter has become an especially relevant medium for the creation and dissemination of political discourse relating to Brexit, whether in the form of official statements, news, commentary, or jokes. MPs often post clips from their speeches in Parliament on social media in order to amplify their message among local constituencies in the Scottish political realm; however, Twitter can also extend beyond Scotland’s borders to shape the national debate. Vocal dissent amongst elected SNP MPs has brought attention to Brexit’s constitutional implications and Scottish grievances over perceived disempowerment due to the proposed Brexit deal going against the democratic will of Scotland’s Remain majority. Joanna Cherry, SNP MP for Edinburgh South West, bluntly described the power dynamic between Theresa May’s government and Scotland in a post on December 10, “Brexit has shown how unequal the Union of the UK is. The PM and her government have no respect for Scotland. Her #Brexit deal has failed and her government is failing. She must put the deal to the people. #PeoplesVote.” On January 21, Ian Blackford, SNP MP for Ross, Skye and Lochaber posted a clip from the House of Commons debate in which he framed Brexit as a precarious and existential situation: “We will not be dragged out of Europe by a Tory Government we did not vote for. We might not be able to save the UK but we can save Scotland. We have an escape route from the chaos of Brexit – an Independent Scotland.” Beyond just political difference on Brexit, the emphasis on the UK government’s authority to override Scotland’s Remain vote exposes the inherent power imbalances in the British system.

The official SNP Twitter account used similar language in a post on January 27: “We don't accept Scotland being dragged out of the EU against its will by a reckless, incompetent Tory UK government. Once the Brexit fog clears, the people of Scotland should have the right to look at a brighter future with independence.” The reality of a second independence referendum is unlikely, especially due to public fatigue with political instability and a complicated process for Scotland to hypothetically re-enter the EU as an independent country. However, the revival of SNP rhetoric about independence signifies not only strong political discontent with Theresa May’s government but a deeper frustration with the asymmetrical territorial distribution of power in the British constitution.

The largely unwritten UK constitution allows a wide range of flexibility to redefine the political fabric of the state, as legislation and convention can be rewritten, repealed, and reconsidered over time based on the governing political party’s interests. Unlike the United States Constitution, there is no single document that defines a unifying constitutional vision or clearly outlines the relationship between the central government and component nations. In the case of Brexit, the lack of a legal roadmap means that the UK is a “real-time experiment” in constitutional change. Scholarly understandings of the British constitution have changed significantly over time, as Vernon Bogdanor asserted in 1979 that the UK was “profoundly unitary” due to the supremacy and sovereignty of Westminster, in following decades a new understanding has emerged framing the UK as no longer unitary but perhaps still organized around the supremacy of the UK Parliament. Since 1999, devolution has allowed greater ambiguity in the constitutional arrangement between the UK Parliament and devolved legislatures. However, Brexit puts into question the nature of the territorial British constitution with semi-devolved powers.

A case that recently came before the UK Supreme Court shows competing constitutional visions in action. In R (Miller) v Secretary of State for Exiting the European Union, or otherwise known as the Miller case, the High Court determined that the UK Government may not unilaterally trigger the Article 50 procedure to formally exit the EU without Parliament’s approval in the form of legislation. The UK Government appealed the case to the Supreme Court which allowed the Scottish government to also claim their approval was necessary to trigger Article 50, due to “a fundamental alteration of the UK’s, and particularly Scotland’s, constitutional arrangements.” The Scottish government’s legal argument hinged upon the Sewel Convention, a principle “that the UK Parliament will not normally legislate on devolved areas without the consent of the Scottish Parliament.” The Court deemed the Sewel Convention not legally enforceable as a norm rather than a law, thus the European Union (Notification of Withdrawal) Act passed through Parliament in March 2017 without the approval of devolved governments. McHarg and Mitchell concluded, “Brexit will affect devolved decision-making and questions of constitutional voice, in terms of how much influence they are able to exert over the form that Brexit takes, or indeed whether it happens at all.” In practice, Scotland’s constitutional influence on Brexit has been significantly limited by the UK Parliament, setting the stage for an even greater degree of SNP rhetoric about disaffection, independence, and self-determination.

It is impossible to know exactly how Brexit will affect UK politics in the long-term. The British constitution is dynamic and adaptable, though the EU referendum has exposed significant fault lines in the union between Westminster and Scotland. If the next generations of Scottish voters continue to feel perpetually unrepresented by British politics and expelled from the EU against their will as SNP rhetoric suggests, the current union arrangement may be unable to resist popular mistrust indefinitely. Similar forces of anti-establishment politics that made Leave appealing to the disaffected UK electorate in 2016 could eventually influence another referendum on a Scottish exit from the UK. Though Scottish independence seems politically improbable and absurd, the idea of Brexit itself also would have been unimaginable only a few years ago. Constant change in British politics is part of its institutional design, and as time runs out on the March 29 Brexit deadline, spectators of Parliament will find that absurd and unlikely things can happen quite often.

Security Implications of Post-Brexit Fragmentation in European Financial Governance

Combating illicit finance, ensuring the stability of capital markets, and preventing crises are not purely financial concerns anymore. Not only has the relevance of military power arguably declined and that of economic power rose since the end of the Cold War, but financial markets themselves underwent major securitization. Budgetary and financial considerations have always constrained foreign policy, but finance and security now merge in less obvious ways. The intensified surveillance of banking after 9/11, rising popularity of financial, rather than trade, wars, and the growth of government interest in acquiring financial data are all making it ever more difficult and dangerous to treat the governance of finance and security as only loosely connected.

The expanding overlap between finance and security should raise additional concerns over the so-called “Brexodus,” the shift of financial power and competence away from the UK and toward the Continent. The UK’s loss of access to the integrated financial market will not only hit bankers and investors. Its implications are of national, regional, and global security importance. The European Supervisory Authorities (ESAs), created to integrate financial supervision within the EU, are now preparing to relocate the headquarters of its major regulatory agency, the European Banking Authority (EBA), from London to Paris. The UK’s departure from the EU will exacerbate preexisting gaps in cross-border cooperation in combating illicit finance, which previously allowed for the movement of dirty funds revealed in the Panama Papers and the Global Laundromat series. Meanwhile, British firms continue to benefit from massive inflows of foreign capital, a significant portion of which the British government believes to be laundered, and London remains one of the most attractive destinations for potential ‘golden visa’ holders. Considering the reputation of the city as the money-laundering capital of the world, the relocation of such a prized regulatory body as the EBA is an especially salient issue, since Britain will now have to assume responsibility for building an independent administrative capacity to counter the estimated £90 billion worth of illicit financial flows that go through London each year. This number constitutes a staggering 17 per cent of total global money laundering – an amount challenging to handle in the absence of Europe’s regulatory framework the UK will lose access to. Having more than one-sixth of the world’s money laundering transactions face less regulation than ever before opens new opportunities for proliferation and terrorism financing, let alone tax evasion and anonymous shell companies.  

Back in 2016, British authorities lamented the deterioration of the UK’s status as a world leader on anti-corruption due to the continuing lack of transparency domestically. Now, its reputation as the upholder of European financial market stability is under threat, too. More than 90 percent of the euro-denominated derivatives business of euro banks are currently cleared via central counterparty clearing houses (CCPs) in the UK. Central clearing is a crucial function of the global financial system that ensures investors can access liquidity in multiple currencies across multiple markets. Britain handles the majority of euro banks’ interest rate and credit derivative transactions, as well as a significant number of commodity and equity derivatives. In light of Brexit, EU experts worry the potential CCP failure will result in massive, volatile movements in the comparative cost of using UK CCPs, which might trigger the transfer of hundreds of thousands of trades worth trillions of euros. Such disruption is likely to cause a liquidity drain and erode profitability in the short-run and leave systematic consequences on the global financial system in the long-run. With those concerns in mind, Yves Mersch, Member of the Executive Board of the European Central Bank, encouraged EU authorities to consider taking action to ensure the Eurosystem has adequate control over the impact of clearing activities in the UK. What it ultimately means is a transition towards a new European and global clearing system, over which London will have considerably less influence. Such a dramatic departure from the “London-centrism” of regional financial markets will undoubtedly give Britain more autonomy, but it will also weaken the UK’s ability to impose its preferences on regional and, consequently, global financial governance.

Some view fragmentation of financial governance as less detrimental, claiming it decreases chances of systemic risk due to more diversified and thus more robust regulatory systems. Jon Danielsson of London School of Economics and Political Science argues that divergent governance regimes protect against synchronized reactions of financial firms – one of the few mechanisms capable of triggering a collapse of an entire financial system. However, many consider it undesirable for the new British regulatory system to differ too dramatically from that of the EU. Fearing Brexit might pose a systemic risk not just to the domestic market but to the global financial system, Piers Haben, Director of Oversight at the European Banking Authority, has called for Britain’s exit from the EU’s financial system to be “as smooth as possible,” implying that the UK and EU should not do much to alter their regulatory regimes. Depending on what side of the argument one is on, Brexit can mean both greater and lesser systemic risk. What is certain is that there should be a balance between centralization, which provides convenience for market participants, and decentralization, which mitigates risks. Achieving such delicate balance requires key actors’ trust in one another and an environment conducive to successful negotiations. Brexit is very unlikely to encourage either of these things.

On the Continent, however, things are not looking entirely grim for the future of financial governance without extensive British involvement. While the prospects of a hard Brexit are becoming more and more likely with each week of unsuccessful negotiations, European financial governance is growing its emphasis on operational, rather than regulatory, functions, both regionally and globally. Scholars speculate that the UK’s presence in the EU was, in fact, a major friction preventing the euro area from further centralization of institutional governance. Now that this impediment is removed and the political support for a financial union is sufficiently high, the ESAs will find it easier to come to cooperative positions without the need to factor in the peculiar preferences of the largest financial market in Europe. The ESAs will be able to take a more assertive position and assume a more prominent role internationally. “If you’re tired of London, you’re tired of life,” the famous saying goes, but Brussels will have no choice but to make the most out of its inevitable break from the City.

On the Brink of Collapse: The European Union’s Transition as it Strives to Survive

The recent vote for the United Kingdom (UK) to leave the European Union (EU), commonly called Brexit, was a manifestation of Euroskepticism, a term coined to describe resistance to European integration or involvement in the EU within the UK but which has now spread to other countries. Before the establishment of the EU, the UK, Luxembourg, Belgium, the Netherlands, France, and Germany came together to form the European Coal and Steel Community (ECSC), which bound France and Germany’s coal and steel industries together, the two industries absolutely necessary to wage a war, hoping to bring lasting peace to Europe. The ECSC has since expanded to encompass other policies and countries, transforming over time into the EU as it is now. However, the EU is now seen as a failed utopia, and Euroskepticism, encompassing everything from uber-nationalist political parties and their supporters to those providing constructive criticism with a goal of reform, is on the rise in many European countries. The recent struggles the EU has faced began with the acceptance of poorer nations without strong democratic histories, a principle on which the EU was founded, and is culminating in peripheral countries such as Greece, Portugal, Spain, and Italy, which were formerly pro-EU, succumbing to Euroskepticism. Euroskepticism is also rising in countries like Germany and other solvent members of the EU because they now have lacking finances and little willpower to bail out financially struggling members. Euroskepticism is the manifestation of problems in the EU like economic stagnation, the Euro crisis, conflict over migration, and Russian threats and pressures, many of which stem from the much-enlarged, poor, and diverse EU. Overall, the EU is struggling with overall coherence, policy, and solidarity, and while the majority of young people feel they have a European identity, many others feel a European identity is overshadowing and threatening to their national identity and sovereignty. Additionally, there is a tendency to blame Brussels as the head of the EU for problems that may or may not be covered under national responsibilities. Throughout this uncertain period in EU history, there have been many options for the EU: to disband altogether, to remain as it is, to strengthen the binding ties between EU member states, to leave the Euro and keep the EU intact, or have members pick and choose which parts of the union to adhere to. Given all the potential solutions for the EU’s future, the most effective solutions would be to establish a “two-speed Europe”, a pick and choose system.

One factor sparking a call for change in the EU’s operation like a two-speed system is the normalization of far-right political parties in Europe and around the world, marking the first time that far-right groups have been widely popular since World War Two. If far-right parties succeed in key upcoming elections in Europe, they will restrict freedom of movement in the EU, potentially catalyzing the breakup of the Eurozone and the EU as a whole. The upcoming elections in Italy and particularly France have led to uncertainty surrounding the future of the EU and the Euro. The Front National’s Marine Le Pen sees political conflict in Europe as populists, or Euroskeptics, against globalists, or pro-EU thinkers. Le Pen sees the Euro as a political move, rather than a currency, in order to get countries to follow EU protocol and rules. Additionally, Le Pen, claiming that the EU has an authoritarian nature, supports Frexit, the French exit from the EU, if France cannot gain control over their border, currency, sovereignty, economy, and laws (in other words, everything that the EU was created for: linking France and Germany together to prevent another war in Europe).  A Le Pen victory could signify the end of the EU, as France was a founding member of the EU. While Le Pen is most certainly the most conservative and controversial candidate in the French election, Francois Fillon, a conservative candidate, is also Euroskeptic, anti-Euro, and anti-migrant. While the French election won’t be finalized until May, the Dutch general election held in March resulted in a win for the ruling liberal party (VVD) with the second most seats going to the far-right party (PVV); however, all other parties have stated that they will not collaborate with PVV to form a government. The UK will also be holding local elections at the beginning of May, and the pro-EU party, the Liberal Democrats, is strong in the polls. Finally, October will mark important elections for the EU as Chancellor Angela Merkel seeks another term and is likely to succeed, but the far-right party AfD is polling well and is likely to take several seats in the Bundestag. AfD is campaigning on a platform that is anti-EU, opposed to funding for Greece and Italy, and anti-migration. The Brexit vote illustrates the importance of the upcoming elections, as any further dissolution could be disastrous for the future of the EU.

One option for mitigating problems in the EU is to create a “two-speed Europe,” or a pick-and-choose system of membership. In other words, this system would allow groups of members to continue integrating while others continue as they are. This solution would have eased the concerns in Britain over losing sovereignty in the EU, which may have prevented Brexit had this been in place to begin with. Some pro-EU thinkers believe that this system is the best option. For example, Greece should not have been able to join the Eurobecause it wasn’t ready; however, as part of accession to the EU, new member states agree that they will one day join the Euro. Likewise, states that are not ready or are resistant to certain policies should not have to or should not be allowed to partake in those programs, as they won’t gain anything by participating in a program they don’t agree with. These ideas are cemented by the fact that the EU member states are very diverse, which should encourage flexibility rather than uniform convergence. However, some countries like Hungary and Poland fear marginalization through this two-speed system. Even though EU membership is still popular in many periphery countries, as citizens have benefitted from EU funding and the freedom of movement, many politicians fear that Western liberalism is eroding their identities.

Dissolution of the Euro is another option, as much of the strain on these countries stems from the financial obligations and burdens of carrying member states with struggling economies that use the Euro. Britain, Scandinavia, and Switzerland never joined the Euro, and now developing members not on the Euro yet, like Poland and the Czech Republic, are reluctant to join because of its economic shortcomings. In order to make the Euro work, the EU would need to streamline policies like taxation, spending, and banking, which would create a super-state weighted toward Southern Europe. A super-state Europe is out of the question, as many countries are disenchanted as it is now and believe that they are losing sovereignty and identity. Thus the only feasible solution to making the Euro work, creating a super-state, is out of the question and would only aggravate current political conflicts.

The final option for the EU is its complete dissolution, meaning every member state would become completely sovereign once more. These countries would have complete autonomy over their economies and policies, which is appealing to many nationalist or populist political parties and supporters across the member states. However, Germany is the powerhouse of the EU and has held the EU and Euro together for many years, meaning it has the most to lose if the EU or Euro failed. Therefore, Germany would not let the EU fail and would try its best not to let the Euro fail. Many other member states still enjoy the benefits of the EU and would want to keep it from failing as well. Finally, since the EU was created to prevent another war in Europe from breaking out, some politicians and citizens understanding the significance of this union would need to find another solution to prevent another war in Europe or make peace with the fact that there is no longer a safeguard. The complete dissolution of the EU is not a realistic option for the future of Europe.

When determining the best course of action for the future of the EU, we must take into account both the current political situation in many of the key countries like France, Britain, and Germany and the options for the future of the EU. Considering politics in the decision between creating a “two-speed Europe” and just dissolving the Euro, countries would still be unhappy even if the EU dissolved the Eurozone because it would not solve the problem of sovereignty, national identity, border security and migration, and a plethora of other controversial subjects. When taking all of this into account, creating a “two-speed Europe” is the best option for the future of the EU. In order to keep countries content, the EU must offer options and the member states can choose which best suits their needs, preparedness, and willingness. Countries will participate in programs that are suited for what they are prepared for. Despite the concerns of some peripheral countries, this option would be the best system for each individual country because they would be able to keep their national identity, have say over their sovereignty, and hold referendums on issues that are important to them or controversial in their country rather than being forced to participate in programs that they don’t agree with. Creating a “two-speed Europe” would ensure that member states are content with their membership in the EU and would make justification for leaving the EU more difficult, meaning another Brexit would probably not happen. Thus, a “two-speed Europe” is the best option for the continuation and future of the EU.

The Puzzle of Scottish Independence and EU Membership

The possibility of an independent Scotland and its consequent European Union (EU) membership holds a plethora of issues and ambiguities left to be clarified. The issue at hand is that the Treaty of the European Union does not address how, or if, a region of a current member could obtain membership, if that region becomes independent. The impending ‘Brexit’further complicates this matter. This grey area of potential membership is increasing the demand for clarification regarding membership acquisition in light of the ‘Brexit’ and the growing instability of the European Union.  The potential secession of Scotland from the United Kingdom (UK) and entrance into EU membership poses a multitude of issues: defining the type of relationship an independent Scotland would have with the EU, what the process would be to become a member and how the process would manifest, and how the ‘Brexit’ affects Scotland’s want for membership.

There are contentious debates surrounding the Scottish need for departure from the UK and its subsequent reapplication to the EU. Some experts assert that an independent Scotland would only need to ratify a number of treaties to be a full EU member, while others state that Scotland would become a “third country” (a non-EU member) and thus would be immediately expelled from the EU.

Each theory has its discrepancies, and no one method has been defined as the clear course with which an independent Scotland should proceed. Furthermore, Scotland’s role in the EU will also be reintroduced within the context of the ‘Brexit.’ The outcome of the 2014 Scottish independence referendum was largely affected by the Europhile sentiments of the region and its desire to retain its EU role; thus, the ‘Brexit’ could trigger another referendum on independence that could result in Scotland preferring the EU to the UK. The EU-Scotland relationship needs to be defined, with a process for enacting that relationship decided upon, in order to present a clear future including EU membership to the Scottish people. By defining and asserting a clear path for Scotland, the EU can preemptively avoid any future issues such as drawn out negotiations or shocks to the EU economy.

Scotland’s want for independence is politically and economically based. The country, which has been ruled by the UK parliament since 1707, came under UK rule during a time of economic need, when insufficient supplies and catastrophic illness crippled the country. However, Scotland has matured in the modern age and is no longer in need of an economic system rooted in regional co-dependence. One of the primary arguments for secession is that Scots would gain political sovereignty (a wish that was only partially met by the creation of the Scottish Parliament in 1998. This furthered sovereignty would also have economic benefits, with increased economic freedom from UK obligations. However, both Scotland’s current political and economic standings are dependent on its membership in the EU. Scotland wishes to be politically independent in order to represent itself both to the world and to the EU specifically. With individual membership, Scotland would gain its own vote in EU matters; currently, the United Kingdom has a vote in EU matter, which represents the whole of the UK. In becoming an individual member, Scotland would be able to vote along the lines of its own interests and not merely be represented by the UK. Furthermore, economic independence would retain Scotland’s current dealings, while opening the economy per the wishes of the Scottish people. Thus, the question at hand is whether or not an independent Scotland could be a EU member in order to gain politically and economically.

The grey area surrounding an independent Scotland’s EU membership originates in the Treaty of the European Union (TEU). When the treaty was written, it had not been anticipated that a region of a Member State would attempt to secede, and thus the treaty has not identified the process concerning regions that have seceded from Member States. This means that, while there is a process in place for a member state to leave the EU, there is not one that specifically addresses a region such as Scotland. Thus, there is no predetermined legal process for Scotland that addresses what it would mean to secede from an EU member state. One viewpoint is that Scotland, by seceding from the United Kingdom, is exiting the EU. This is the opinion of former presidents of the European Commission, Prodi and Barroso, who described Scotland’s secession as an immediate withdrawal from the EU. This, however, is not economically or legally feasible because Scotland is economically intertwined with the EU, and Scots are currently EU citizens. An overnight expulsion of Scotland from the EU would devastate its economy as it is reliant on EU free trade — three of Scotland’s top five export partners are EU members. Member States are also entangled with the Scottish market, as they too gain from Scottish imports such as petroleum and chemical products. An expulsion of Scotland would manifest in the form of duties on its exports and imports, as well as the potential creation of export quotas for goods going into the EU. These restrictions would stress Scotland’s economy and potentially create barriers for EU countries seeking Scottish goods. Furthermore, Scots are EU citizens and to strip them of their citizenship overnight would be a harsh act that would leave many abroad without the freedom to cross borders, or at schools they can no longer afford. In addition to these entanglements, an immediate expulsion of Scotland would disregard the EU principle of sincere cooperation, diminishing Scotland’s right to the democratic process and the principle of continuity of effect. At any length, it appears that if an independent Scotland were to be considered a third country (non-member state) to the EU, it would be necessary to invoke Article 50 of the Treaty. Even if the EU considers the British exit to be Scotland’s exit from the EU, the exit itself would have to be negotiated over a two-year period to finalize all aspects of former EU dealings. However, a radically different view of Scotland has also been proposed.

The Scottish government, prior to the election, stated that an independent Scotland would be able to “take its place as a full Member State within the European Union”. This wording assumes Scotland’s current role in the EU as partial membership; it acknowledges Scotland’s role in the EU while recognizing that it soon will not be a member state. The government has elaborated on this matter by stating that, following a vote for independence, Scotland would enter negotiations with both the UK and the EU to ensure a smooth transition into independent EU membership. This method of negotiation is corroborated by a number of experts that define Scotland as a non-member actor in the EU. However, this relation to the EU, and the process as previously defined by the Scottish government, is dependent on the UK’s role as a member state.

The situation in Scotland was made more complex by the ‘Brexit’ vote. Many people have incorrectly assumed that the ‘Brexit’ would simply incite another Scottish referendum because of Scotland’s Europhile tendencies; however, Scotland’s plan, as stated in a government white paper, Scotland’s Future, is dependent on the UK as a member state. In the proposal for an independent Scotland, potential EU membership is defined as full membership, but with certain opt outs such as abstaining from certain EU norms that the UK currently abstains from. Specifically, Scotland will not pursue an entrance to the Eurozone or the Schengen Area, opting instead to continue using the pound and to keep its current Common Travel Area with the UK, The Republic of Ireland, Channel Islands, and Isle of Man. These two opt outs are radically affect by the ‘Brexit.’ Scotland now faces more questions concerning its potential EU membership including whether or not Scotland can mimic the Republic of Ireland’s opt out of the Schengen Area, and keep an open border with the UK, regardless of the Schengen’s external border resolution. The other, and more complicated, issue of currency will also need to be resolved. While Scotland has stated that it intends on continuing its use of the pound, it is questionable that as non-member the UK would allow its currency to be used by a separate country that willingly removed itself from UK jurisdiction. This topic has no precedent and would need to be determined by the UK Parliament. In addition to these technical conflicts, Brussels has ruled out the possibility of Scotland remaining in the EU while Britain leaves. The European Commission came to this conclusion in late June, with the intention of relaying that an independent Scotland would need to reapply for membership regardless of the timing of independence, since it will be a post-Brexit vote. However, this declaration too has loopholes and leaves Scotland’s future with more questions. It has been speculated that Scotland could follow in Greenland’s footsteps from 1982 when Greenland itself broke away from the EU, but its residents (Danish residents) and Denmark itself remained in the EU. In this situation, Scotland (which has voted to remain in the EU and predominantly voted against the Brexit) could use this precedent loophole to retain EU benefits that it has desperately been pursuing.

Scotland’s future is facing many contradictions in terms of its participation in the EU. Scholars and politicians cannot agree on the terms of a Scottish claim to EU membership or the process by which an independent Scotland could attain membership. The Brexit has further complicated the matter by forcefully beginning Scotland’s unwanted exit from the EU and the single market in particular. Indeed there is no clear path for Scotland at this time. The only clear aspect of this grey area is that Scotland wants EU membership and has proved so time and time again. It is a key player in, and depends on, the EU single market, and is prepared to fully add to the system by commissioning a full vote. Should Scotland have the opportunity to be a full EU member, it would do so whole-heartedly.

The EU Single Market and the Economics of Brexit

The future of the United Kingdom’s relationship with the European Union is unknown, though there has been much speculation on what the details of Brexit will entail. In regards to the Single Market, which guarantees free movement of people, goods, services, and capital among member states, some experts have called for a special deal to be made with the EU to uphold as many of these provisions as possible. While a unique agreement with the EU will help the UK maintain economic stability, it must also be met with many domestic and transnational policy reforms, as well as new trade negotiations. In light of the UK’s decision to leave the EU, it must be willing to forfeit all benefits and privileges currently enjoyed by EU agreements, including the Single Market. As such, the UK must develop a new plan to ensure continued economic growth and secure trading partners.

Prime Minister Theresa May has been clear on her position, stating in a speech, “It is not going to be a ‘Norway model.’ It’s not going to be a ‘Switzerland model’. It is going to be an agreement between an independent, sovereign United Kingdom and the European Union.” She went on to say that, “We will seek the best deal possible as we negotiate a new agreement [on the single market] with the European Union.” Currently, Norway and Switzerland, although not members of the EU, enjoy certain benefits of the union on an opt-in basis as established through various treaties and agreements. However, May’s statement underlines the UK’s increasingly isolationist position, and its determination to forge its own path in the international community. By insisting creating its own ‘model,’ the UK will have more opportunity to craft an agreement it sees as ideal; however, it also gives the remaining members of the EU more leverage in designing it as they see fit as well.

Regardless of the exact details of the new agreement, which will not be seen until well after Article 50 is triggered by March 2017, the UK will not have the same access to the EU Single Market that it does now. Even if the government secures some benefits of the current arrangement, the UK’s economy is likely to suffer from increased transaction costs in trade and limited access to the open market. In order to look for the best possible deal in the future, as May stated, it is important to understand how the UK’s economy currently interacts with the Single Market.

The UK’s economy is intrinsically linked to the EU Single Market. Half of the UK’s trade and foreign investments are involved with the EU, with 53 percent of imported goods and services originating in other member countries, and 44 percent of exports going to the EU. Like most developed countries, the UK primarily exports services, and this sector makes up over 75 percent of the country’s economic output. Additionally, the UK has maintained a trade surplus of about 5 percent of GDP, meaning that more is exported than imported. When the UK loses access to the Single Market, it will become more difficult to export to the EU due to higher trade barriers. Unless the UK can tap into a different export market, they are likely to lose this trade surplus and experience a decrease in economic output, leading to a higher deficit and cuts in government spending.

The Single Market also guarantees job mobility and free movement of people. There are currently 1.2 million Britons living abroad in the EU, with about 800,000 of them working. Furthermore, there are currently 3.3 million EU citizens living in the UK, with 2.1 million of them employed. Immigration concerns were a main cause of Brexit, so it seems unlikely that the UK will negotiate for the free movement of people in a new agreement with the EU. While proponents of Brexit might call this a success in taking ‘British’ jobs back from immigrants, the high employment rate of EU citizens in the UK is a sign of national economic prosperity, not a race to the bottom for limited jobs with low wages. Large companies located in UK cities will also look to relocate to other EU commercial centers in order to continuing benefiting from the free movement of their workers, goods, and services. The loss of both large employers and vast numbers of workers will lead to further depressed economic output in the UK.

Under the threat of stagnated or decreased economic growth and trade, the UK is already looking to potential new trade partners. At a state visit in early November, the president of Colombia said that a new agreement with the UK had the potential to be better than the current deal the South American country has with the EU. Colombia is part of the Pacific Alliance, a trade bloc composed of three other historically strong Latin America economics – Chile, Peru, and Mexico – which would provide an even larger opportunity for new UK trade.

May also visited India in early November, in her first bilateral meeting outside Europe, to discuss, among other things, a new potential trade relationship. Unlike Colombia, India does not currently have a trade deal with the EU, and any attempts to create over the last decade have ultimately been unsuccessful. As discussed earlier, the UK must secure partners that are interested in service sector exports; however, India has tough restrictions on importing professional services, such as business, banking, and legal sectors. Immigration is also a controversial issue between the two countries, and India wants more temporary student and work visas to the UK in exchange for allowing more business. However, since a main component of Brexit involves reducing the number of immigrants in the country, this seems to be an unlikely concession.

Finally, the UK also recently hosted China for trade talks, announcing several new agreements to strengthen investment and business between the two countries. China has committed to investing in the London Royal Albert Docks project, while the UK will reciprocate with an investment in the Asian Infrastructure Investment Bank. UK Chancellor Hammond remarked that the UK’s “trade relationship with China is now more important than ever.” Unlike India and Colombia, China will carry out this agreement before UK negotiations with the EU are finalized, signaling that China will remain a reliable trade partner regardless of the outcome of the UK’s involvement with the Single Market.

The decision to leave the EU, and thus the Single Market, could have devastating effects on the UK’s economy, unless it seeks new markets for service sector exports. Colombia, India, and China all represent opportunities to connect with robust economies that will provide the UK with the exit strategy it needs. However, similar to the question of Indian immigration, there are likely to be challenges along the way, especially as most countries will not negotiate a new trade until after the UK has triggered Article 50 and has completed talks with the EU. While the possibility remains that the UK will successfully negotiate to retain provisions of the current Single Market, it is extremely unlikely that the EU will let the UK cherry-pick only the parts they want. No matter what deals are struck with any country, concessions will have to be made. Thus, the UK’s economic plan moving forward must be pragmatic, as well as diplomatic.

Britain and Immigration: Before and After the Referendum

When citizens of the United Kingdom headed to the polls on June 23, they became the first group in history to opt out of the European experiment by popular vote. While many reasons prompted the British exit, growing migration was a prominent justification given by the Leave campaign. Boris Johnson and Nigel Farage, leaders of the Leave campaign, stated that there was no consent for the scale of migration witnessed in the past few years. They promised to bring migration to the normal levels of the 1990s when more people were leaving the UK than entering.

In the past few years, British citizens have continuously voiced their desire to halt or at least reduce the influx of migrants. After failed attempts by Prime Minister David Cameroon to fulfill these requests, Brits decided that leaving the EU was the only viable way to control their borders.

Now that Brexit is a reality, immigration continues to be a complicated issue as many EU citizens in Britain remain uncertain about their future in the country. Anxiety about growing migration is intricately woven into the decision to leave the EU and will remain a defining issue in the post-Brexit world. To understand Brexit, then, one must first understand migration.

United Kingdom Migration Laws

The European Union has adopted an open border policy to facilitate traveling and working throughout the continent. The Schengen Area is a zone of twenty-six European Union countries that have agreed to ease travel requirements with other Schengen Area members. The agreement allows EU citizens within the Schengen Area to travel throughout the area only using an identity card. It also allows non-citizens within the Schengen Area to acquire one visa and move throughout the twenty-six countries.

There are different types of Schengen visas including work and student visas. Work visas, for example, are acquired by individuals who would like to work in one or more of the Schengen area countries. The student visa is used by students who have secured a place to study within an educational establishment in a country in the Schengen Area.

The two European countries that have opted out of the Schengen Agreement are the Republic of Ireland and the United Kingdom. According to laws in the United Kingdom, migrants are divided into non-visa nationals and visa nationals. Non-visa nationals encompass a variety of groups including EU citizens. These non-visa nationals do not require a visa to enter the UK at ports or other points of entry. However, if migrants want to remain the country for longer than six months they must receive entry clearance. Additionally, European Union nationals traveling to the United Kingdom must show a passport or identity card which is strictly scrutinized against security databases.

Around 3.2 million people living in the United Kingdom in 2015 were citizens of another European Union country. European Union migrants make up half of the migrants in the United Kingdom, most of whom hail from Poland, Ireland and Germany. European Union nationals are more likely than UK citizens to participate in the labor market. Currently, 78% of European Union citizens are working in the United Kingdom compared to 74% of UK citizens.

Although foreign born citizens are employed in a variety of sectors, their presence is most prominent in low skilled sectors. In 2015, 59% of EU born workers were in a low skilled job compared to 45% of UK-born citizens. Conversely, 41% of EU born workers were in a high skilled job compared to 55% of UK-born citizens. The presence of EU workers in low skill sectors shows that EU workers are more likely to take on jobs that may be undesirable to those born in the UK.

So if the United Kingdom is mostly benefitting from European Union migrants why did the country choose to leave the European Union?

The Referendum and Immigration

While the Leave campaign presented several justifications for leaving the EU, a persistent theme was an emphasis on national sovereignty and the reduction of migration.

In 2015 the United Kingdom welcomed 630,000 migrants and in 2016 thus far the UK has welcomed 333,000 more. This influx of migrants, prominent throughout Europe, has prompted 77% of Brits to declare that there needs to be a reduction in migration. In fact, 50% of Brits believe that immigration is the most important issue facing Britain, compared to 27% who say the same about the economy.

This anxiety over booming migration played a major role in the Leave campaign’s justification for a European Union exit. The UK Independence Party, led by Nigel Farage, focused on the threats of migration leading up to the Brexit referendum, and anti-immigrant rhetoric persisted throughout European Parliament debates over the Syrian refugee crisis. Like U.S. presidential candidate, Donald Trump, UKIP painted migrants as potential criminals and terrorists taking over the United Kingdom. Nigel Farage even used a poster to emphasize that if the UK remained part of the European Union, the country would be flooded with migrants. The poster displayed by Farage leading up to the referendum depicts a long line of Syrian refugees on the Slovenian border with a caption which reads “Breaking Point: The EU has failed us all.” The posteralso cautions readers that Britain must break free and take control of its own borders. Now that referendum results are in, the country has “broken free” but what does that mean for its borders?

Immigration after Brexit

The Leave campaign proposed an Australian style point-based immigration system which would apply to all migrants, even those from the European Union. Under this system, the more in demand the skills and qualifications of an immigrant, the more eligible the immigrant is for a visa.

As resentment over Brexit mounts in Europe, it is likely that European countries will use migration as a concession for any future trade deals with the UK. In fact, Germany, Portugal, and the Czech Republic say the UK must accept free movement of people in return for access to the single market. The EU single market is an association of countries which trade with each other without restrictions or tariffs.

There are three main models for the UK’s post- Brexit relationship with the EU proposed by the Leave campaign. The first option is the Norwegian modelwhereby the UK exits the European union to join the European Economic Area which is what Norway did in 1994. Under this model, EU policies not covered by the EEA Agreement such as agricultural and fisheries policy would not apply to the UK. The UK would need to retain a range of EU legislation, however, including the free movement of people. So, under this model the promise of curbing migration would not be fulfilled because the UK would be forced to maintain the free movement of people.

The other alternative is the Swiss model. Under this model, the UK would join the European Free Trade Association but not the European Economic Area. The Swiss model is unique because Switzerland enjoys some access to the single market through bilateral agreements. In order to maintain access to the single market, Switzerland was required to allow the free movement of people, which would likely be a prerequisite for any bilateral agreements with the UK as well.

The last alternative is a total exit from the EU and the single market. Under this model the UK could join a Customs Union. The EU does not impose tariffs on goods traded from Customs Union countries in exchange for those countries’ compliance with EU single market regulations. The UK could also rely on the World Trade Organization rules on nondiscrimination whereby trading partners are not treated any less advantageously than others, unless there is a separate free trade agreement between the members. Under WTO rules, the UK would be treated as a third country that does not have a free trade agreement with the EU. The last option is the negotiation of a completely new free trade agreement with the EU. Even with a new agreement, however, there is a chance that free movement of people would be a prerequisite for any access to the EU market.

Implications

As European Union and British politicians continue to negotiate, European migrants in the United Kingdom are living in uncertainty. While those who have lived in the UK for more than five years are afforded permanent residence, no one knows if the EU migrants who have been in the UK for less than five years will be asked to leave. Additionally, there has been no clarification as to when European Union migrants will be forbidden from freely entering the United Kingdom.

The United Kingdom was never fully integrated in the European Union system of free movement but the country has welcomed EU migrants for decades. With growing hysteria about migration, however, Britain was unable to sustain its open border policy any longer. Capitalizing on anxiety, the Leave campaign framed migration as a threat to both security and sovereignty. The consequences of this fear mongering were grave—Britain became the first and only nation to leave the European Union by popular vote. Anxiety about migration led to a catastrophic decision which will have lingering effects for years to come.

So, as the world prepares to assess the state of geopolitics in 2016, it must consider the impact of Brexit. As individual nations and as a collective, we must not let anxiety about migration be a leading factor in any future elections. We must pick leaders who can unite us as a global community which can tackle the problems of the 21st century, not leaders who will divide us into fragmented nations living in fear.

A Tale of Two Memberships: Scotland and Northern Ireland’s Possible Paths to EU Membership as Independent States

The Brexit referendum on 23 June 2016 brought 30 million voters (with a 71.8% voter turnout) to the polls to decide whether the United Kingdom (UK) would stay in the European Union (EU). The “Leave” campaign narrowly won with 52% of the vote; however, when split by countries in the UK, Wales and England voted to leave while Northern Ireland and Scotland voted to remain by much larger margins. Additionally, demographics with a higher income, more education, and younger age generally voted to remain. Although the referendum was not legally binding, the new Conservative UK Prime Minister, Theresa May, stated that she has committed herself to the will of the people and will guide the UK leaving the EU. However, Prime Minister May also said that she will not invoke Article 50 of the Lisbon Treaty, which gives the country two years to negotiate its exit with EU members, before the end of 2016. Thus, the UK would remain a full member of the EU until Article 50 is invoked and the UK begins negotiations to leave. Once negotiations are fully over, the UK will officially no longer be a part of the EU; however, until that time, the UK is a full-fledged member. When the UK leaves the EU, it will need to negotiate a new trade deal because it will no longer be a part of the EU single market. Thus, there is a possibility that the EU would instate trade tariffs because the UK would not be part of the single market.

Since Scotland and Northern Ireland both voted overwhelmingly to remain, one or both of the countries may leave the UK in order to stay in the EU. However, there are two paths for the different countries. Scotland only has one option if it wants to remain in the EU: secede from the UK and join the EU as a separate country. Northern Ireland has two options: it can unite with the rest of Ireland in the EU and become part of the EU by joining an EU member state, or it could leave the UK and try to become a member of the EU member. The best option for Northern Ireland to remain in the EU is unification. Otherwise, Ireland would go through the same accession process as Scotland, which will have a long, difficult road to EU membership, if it gets in at all.

Accession Process

As the UK now has to negotiate its exit from the EU, there are talks of Scotland and Northern Ireland leaving the UK to join the EU. If Northern Ireland were to join independently, it would join Scotland in the EU accession process.

The EU has strict criteria for membership: a country must have stable institutions that represent and ensure democracy, human rights and minority protection, and rule of law, a functioning market economy capable of dealing with competition in the EU market, and the ability to effectively implement membership obligations and to adhere “to the aims of political, economic and monetary union”. The first step to membership is an application for candidacy. Negotiations can only begin with a unanimous decision in the EU Council.

Accession involves 35 chapters relating to policy areas such as environment, rule of law, human rights, energy, and transportation. These chapters are non-negotiable, but candidates can determine how and when to adopt and implement them. Meanwhile, the EU receives guarantees on completion and effectiveness from the candidate country and from the Commission, which monitors implementation and benchmark requirements. Outside the 35 chapters, candidate countries also negotiate financial and transitional arrangements. The negotiations occur between representatives and ministers of the EU and the candidate country at what is called an intergovernmental conference. For each chapter, in a process called screening, the candidate country must meet the opening benchmarks before the chapter can be opened. Then, for each chapter, the candidate country must submit a position for negotiation while the EU adopts a common position and sets closing benchmarks for the chapter, which must be met before closing negotiations for that chapter. Some chapters have interim benchmarks that must be met. Thus, the length of negotiations may vary depending how prepared the country is to join the EU.

In closing negotiations, all negotiations for individual chapters must be finished. Details of membership, arrangements and deadlines, financial arrangements, and potential safeguard clauses are all in the Accession Treaty. The treaty has three steps to becoming a binding agreement: it must have the support of the EU Council, EU Commission, and European Parliament; the candidate and all EU member states sign it; the candidate country ratifies it according to their constitution. Once ratified, the candidate becomes an acceding country and will become a full member on the date agreed in the Treaty.

Scotland

In the event that Scotland secedes from the UK, the EU headquarters in Brussels stated that Scotland has to exit the EU with the UK and cannot remain on its own. Additionally, if Scotland were to secede before the UK leaves the EU, it would be leaving an EU country and thus be leaving the EU. Therefore, Scotland will have to go through the accession process as an independent country.

The accession process poses a number of problems for Scotland, mainly the length of the negotiations and its financial burdens and obligations. Due to the lengthy negotiations, Scotland would be on its own, neither in the UK nor the EU, for some time, which would hinder trade and investment. Additionally, Scotland’s projected country deficit is three times that of the UK, and Scotland would have a higher deficit than the UK does now. The EU limits the amount of debt and deficit its member states can have, and since the economic crisis and the Eurozone crisis, it will likely oversee these requirements more closely and ensure that its members adhere to them. Thus, Scotland might have to reduce their deficit in order to become a member of the EU. Additionally, as reported in 2015,, Scotland has 6.2% unemployment, compared to the UK’s 5.1%, and GDP growth of 1.9%, compared to the UK’s 2.3%. In addition to these potential economic problems, EU membership would be vastly more expensive for Scotland than it was under the UK because Scotland would lose the UK membership contribution opt-outs that Margaret Thatcher negotiated during her time as Prime Minister.

Another potential problem for Scotland’s EU membership is the potential problems regarding its referendum to leave the UK. The EU values democracy, rule of law, and human rights; however,many Scots were ineligible to vote in the referendum. Anyone who is a citizen of a Commonwealth country, the EU, or the UK living in Scotland was able to vote; however, Scots residing outside of Scotland were unable to register to vote. This could call into question whether the process was truly democratic, as some Scottish citizens could not vote in the referendum. This issue must be addressed during negotiations, and Scotland would have to comply with EU democratic ideals, as many Scots were unable to vote in a decision. Thus, looking at all of the problems with Scotland’s independent path to EU membership, it would take years, if not over a decade, to negotiate membership.

Northern Ireland

Given the difficulties that Scotland will face if they try to become an EU member on its own, Northern Ireland’s best path to EU membership is through unification with the rest of Ireland. Using the case of German unification after the fall of the Berlin Wall as a precedent for EU accession, if Northern Ireland becomes part of Ireland, it will enter the EU as part of a member state.

When East Germany and West Germany united, East Germany gained from joining the EU because it “could rely on the tried and tested rules and institutions, the West German social market economy and immediate access to large amounts of financial resources”. Unification inspired high expectations, and East Germany gained advanced, sophisticated institutions and administrators. Unification eliminated most of the legal barriers regarding sovereignty, which usually delay establishment of institutions and full EU membership. However, there was a cultural difference between the two Germanys, and institutions were established on top of East Germany’s previous institutions.

There is still a divide between the two sides of Germany in terms of economic prosperity. After ten years of membership, labor productivity was still 60% of that of West Germany. There has been moderate improvement since unification, though. In 1991, East German income per capita compared to West Germany was 40%, and in 2016, East German income per capita compared to West Germany reached two thirds. Due to Soviet occupation for over forty years, East Germany has a higher level of social distrust than its Western counterpart, which plays a role in its development and integration in the EU. Overall, the economic gap between Germany and East Germany has significantly decreased despite remaining differences.

Although the German unification was successful, it highlights potential problems for Northern Ireland to light. Aside from cultural, religious, and historic tensions between Ireland and Northern Ireland, Northern Ireland might not be as developed because it would not go through the negotiation process or receive EU funding for meeting set benchmarks. However, Northern Ireland has been a part of the EU as long as the UK has, so it has the infrastructure required. Additionally, Northern Ireland was not under Soviet rule and has been developing alongside the rest of the UK and Ireland. Given the minor economic differences between the two countries, Irish unification would be the best option for Northern Ireland to remain in the EU.

Conclusion

Although Brexit will likely have a negative economic effect on the United Kingdom, the country is large and developed enough to thrive regardless of its EU membership status. However, if Scotland opts for independence, it will struggle while if Northern Ireland unites with the rest of Ireland, it will continue on its path in the EU. In particular, Scotland trades more with the rest of the UK than any other country, dwarfing its exports to non-UK countries by comparison. Looking at other economic indicators like deficit and debt, Scotland’s independence would likely increase borrowing and decrease economic stability and security. As Scotland relies heavily on its robust banking sector, the decrease in stability would lead to less investment and fewer banks in the country. As a result, Scotland would regret leaving the UK because the UK would remain stable and prosperous, as it could get products that usually come from Scotland elsewhere. In addition to economic instability, the likely lengthy amount of time it would take to join the EU, if at all, should dissuade Scotland from independence. With neither the UK nor the EU, Scotland would be a small country of just over 5 million with an unstable economy and decreased trade, investment, and movement of human capital. These consequences should, if Northern Ireland were to pursue independence, persuade Northern Irelanders to unite with the rest of Ireland and join the EU upon unification. Northern Ireland has a simpler path out of the UK and into the EU than Scotland, so it would likely not have a major effect on the economy other than changing currency.