10/07/2015
The
Independent has been telling us that chief executives of Germanyâs major companies operating in the United Kingdom have issued a "please stay" appeal on the EU.
Around 2,500 German companies, mainly working in industries such as energy, manufacturing, transport and finance, employ 500,000 people in the UK. They include leading businesses in their fields with global brands such as Basf, BMW, BOC, DHL, Npower, ThyssenKrupp and VW.
And now the organisation representing German industry in Britain, German Industry UK (GIUK) has asked its leading members how they viewed the outcome of the referendum, permitting Dr Bernd Atenstaedt, Chairman and CEO of GIUK, to say: "we ... believe it is in the UK's best interest to stay in the EU for the benefit of our employees and ultimately, the general public".
Crucially, though, if Britain left the EU, these "leading international companies" believe "a new set of bilateral trade agreements would need to be negotiated". They then say that "the added cost of this legally expensive and time-consuming process, would affect both the number of multi-national companies currently operating the UK and those with plans to move to Britain".
This, for many of us, is typical of the flow of FUD from organisations which either do not know â or wilfully disregard â the difference between membership of the EU and participation in the Single Market.
But what is especially interesting in this particular article is the reference to the "legally expensive and time-consuming" negotiations for a "new set of bilateral trade agreements".
Specifically, this is the second time we have seen references to the time taken to negotiate the UK exit, the first being in late June when the
Financial Times had the consultancy
Global Counsel tell us that it could take ten years to leave the EU.
Certainly, the time taken to secure trade agreements is a problem, and we could be seeing a new attack line in the making. Sooner of later, one might expect the Europhiles to notice that it can take ten or more years to negotiate a trade deal with the EU, while the initial time allowed under Article 50 is two years.
To square this circle, we are going to have to be pretty creative but, since we managed to conclude our final entry negotiations in less than two years, the strategy adopted then might offer us a few lessons on how to break from the EU.
However, in complaining about the need to negotiate a new set of
bilateral trade agreements, these businesses who boast "global brands" are being more than a little disingenuous, if not outright dishonest.
The point to make, of course, is that global brands need global markets. To thrive, they would rather replace the network of restrictive and incomplete bilateral deals with sector-specific global deals negotiated on a multilateral basis, giving them access to the global supply network.
Thus, while Volkswagen and BMW (two of the GIUK members) might be keen on the EU having a trade deal with UK, you might expect them to be even keener on there being wider international deals, in which we can all participate. They are, after all,
global companies operating at a global level.
And here there are interesting developments that cut across the narrow rhetoric of this German organisation, looking to organisation at a truly global level.
Almost entirely unreported, and then only in obscure
technical journals, we get glimpses of from the EU's own
CARS21 report which, together with
Commission documents tell us of progress towards making UNECE WP.29 standards truly global.
The most effective instrument for international regulatory harmonisation,
we are told is the UNECE 1958 Agreement, "provided it is modernised to accommodate the needs of emerging economies and to the extent that it enables the mutual recognition of international whole vehicle type approvals (IWVTA) starting with the category of passenger cars".
But what is fascinating is the way these global agreements are being used to anchor regional free trade agreements or Economic Partnership Agreements (EPAs) as they are
being called, when they are dealing with so-called "
new issues" such as regulatory cooperation that go beyond the WTO and are defined as "WTO-plus" issues.
Thus we see embedded in the Japan-EU agreement
currently being negotiated, the adoption of WP.29
UNECE Regulations. And through this, we are seeing an entirely new structure to trade agreements. We are seeing global sectoral agreements stitched together to form a "bundle", with local variations to suit the specific needs of the parties.
It is highly significant that one of the parties in this case is the EU. We have the old-style customs union, which has never been replicated, seeking new-style agreements with Asian economies which are not disposed to relying on traditional formats.
These complex, hybrid arrangements seem to be the future, not least because they embody the flexibility which enables individual nation states to customise their agreements yet conclude negotiations relatively quickly. In this case, negotiations were launched on 25 March 2013 and are expected to conclude in 2015.
If the Germans (or indeed the EU in general) want trade relations with the UK, therefore, they might be better looking to these hybrids. They are able to build on the work of global bodies, yielding productive and flexible agreements. Yet they are also amenable to constant upgrading and amendments, without great dramas.
So different are these arrangements, though, that they remain almost totally under the radar of the legacy media, unreported and generally ignored. Yet, in them lie the germs of a new relationship between the UK and the EU. Instead of chasing after traditional deals, we need to take advantage of new structures and new ideas, adapting them to the needs of modern commerce, freed from the drag of a post-Versailles Europe.
We have opportunities here that are as yet unrealised, but which could revolutionise the EU debate, and break us out of the dreary, FUD-laden rhetoric. There are different ways of approaching problems that have never really been satisfactorily solved, and they are there to use.
