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If you judged what was happening in Britain by watching Twitter, you could be forgiven for thinking, as the Dutch Prime Minister apparently does, that the country is in a state of political and economic collapse. In reality, the only collapse is among commentators whose world view has disintegrated and experts whose expertise is suddenly a lot less valuable. They should stop flapping.
This article was first published as an op-ed for The Telegraph on 30 June 2016.
The country is carrying on and is no more ungoverned than it is during a general election campaign. Instead, we should be preparing seriously for what is to come. Business is already doing so. The Conservative leadership candidates must do so too, and I have three thoughts for them as they set out their stalls.
First, be realistic about how to negotiate Brexit. It will be our most complex negotiation ever. We can’t afford to get it wrong. Whole industries could be destroyed if we do so.
There is a solution. It is to go for Norway status for now, but explicitly as a transitional arrangement. We should say that we intend, after exit, to retain this status for say five years and to use that period to reflect and if necessary negotiate a Free Trade Agreement like Canada’s, if that is what we want to do, or to keep Norway status if we don’t.
The advantages are that it’s an off the shelf option with a largely pre-written Treaty, so politically can hardly be refused to us. It keeps us part of the single market for at least a transitional period and so avoids huge disruption for business. It allows government to sequence negotiations, focusing on issues like the UK’s own trade agreements or support for farmers, which are not part of the EEA and will be complex enough to bed down in the two-year exit period.
Remainers and Leavers should also be able to unite around this as a transitional arrangement. Remainers because it is the least disruptive in the short run and would preserve important economic and business interests like the financial services passport. Leavers because it would achieve Brexit quickly, extract us from everything bar the single market and some closely associated policies, return to us our own farming and fisheries policies, and gives us at least the protection of the EEA safeguard clause for free movement. And if we want to go further, we always have that option.
Of course both sides would have to compromise. But they are going to have to anyway. As a former trade negotiator, I don’t believe we can agree, ratify, and implement a Canada or Swiss-style FTA in two years. It is just too complex. Nor can we put in place and effectively enforce quickly an Australian-style points system for immigration. We need time and this gives us it.
Second, remember this is not just about Britain. For now, we are hearing the bruised reactions of those who run the EU institutions and those in Foreign Ministries who have a vested interest in them. In reality the EU has been in slow-burn crisis for years, and there will be an economic impact in the rest of the EU from Brexit too. Once the shock is over, normal politics will reassert itself across Europe. In politics, the business community, and civil society there will be voices arguing for a pragmatic solution. We will have supporters. We can afford to wait so they can be heard and cooler heads prevail.
Finally, let’s start building capacity now to be an independent actor again. We will need a major enhancement of capability in the civil and diplomatic Services, most obviously in trade negotiating. There are also some skills we won’t need any longer, just as we didn’t need experts in the Berlin Four Power arrangements after 1990.
But it is not just people, it’s also an attitude of mind. Supporters of independence for Scotland sometimes argue that Scotland should behave internationally as if it was independent and it would gradually come to seem natural that it should be. Similarly, Britain should start behaving now for an independent trade policy. We should have our own dedicated WTO Ambassador again. British Embassies should be active on market access problems for British business. We should start discussing the scope for our own trade agreements. It is going to happen and it would be neglect if we didn’t get going soon.
In short: don’t rush, prepare well, and start to act for ourselves again. And let’s be positive. A new chapter is opening in our national story. We are a great country – all of us: all of our political parties, all of our nations. Whatever we do, we are going to be successful. Let’s make it happen.
David Frost was the UK’s most senior trade diplomat, and is now the CEO of the Scotch Whisky Association and an Open Europe Advisory Council Member. He writes in a personal capacity.