Europe (SCF) – The results of the referendum on Great Britain’s membership in the European Union represent a «step backward» for European integration – this was what German Chancellor Angela Merkel said when she spoke by telephone with US President Barack Obama. But it’s worthwhile to clarify that idea: the referendum was not a thumbs down on European integration as a whole, just on the 1950-2000 model of European integration, which entailed partially depriving European countries of their sovereignty and using the machinery of the EU to appropriate all new states (that former version of the European Union expanded eastward in tandem with the expansion of NATO).
The results of the British referendum are likely to lead to a radical revision of the principles governing the relationships within the EU and also to limit the entry of new states.
This period of uncertainty in the relationship between London and Brussels could last as long as two years, during which the parties will have to establish the political and organizational principles that will guide the British exit from the European Union as well as their future relationship. There is a wide selection of potential models to choose from, ranging from close coordination between the United Kingdom and the EU – à la Norway – to the construction of a «framework» relationship, such as what the EU has with the United States, Australia, and Canada.
The second aspect of the problem concerns the prospects for the future operation of the eurozone.
On one hand, Great Britain’s departure from the EU will strengthen the zone that uses a common European currency. In that scenario, the seven non-eurozone EU members will be responsible for only 15% of total EU gross domestic product, whereas currently (with the inclusion of Great Britain) they contribute over 30 %.
On the other hand, the lack of balance in the existing relationship models between eurozone members vs. non-members will inevitably lead to more conflicts between them, which will increase the instability of the common European currency. The European Union is splitting once and for all into supporters of a «strong euro» zone (Germany, France, Italy, Belgium, Netherlands, Luxembourg, and Austria) vs. those countries that see danger in the existence of a «two-speed» financial system within an integrated political organization.
Equally important are the political consequences of the Brexit. The situation today is such that at least ten EU members – Hungary, the Czech Republic, Slovakia, Greece, Cyprus, Spain, Bulgaria, Romania, Portugal, and Austria – might insist on holding a referendum similar to the one in the UK.
And every country in Central and Eastern Europe has its own reasons for wanting to revise its relationship with Brussels. In the Czech Republic those arguments have to do with a pervasive strong desire to quit the European Union, but Hungary’s biggest problem is its loss of an EU ally. Great Britain and Hungary are the only nations that voted against Jean-Claude Juncker’s appointment as president of the European Commission, and the British exit may well buoy Eurosceptic sentiments among the Hungarian elite. Hungarian Foreign Minister Péter Szijjártó has already alluded to this: «Hungary shares many points of view with the UK on the question of European integration, such as the importance of sovereignty and on the responsibility of national parliaments. It is important that this type of thinking is represented by a strong player within the EU».
The Voice of America offered a telling assessment of the new, post-Brexit geopolitical reality in its coverage of the June 24 discussion of the British referendum results at the Washington headquarters of the Atlantic Council: «The results of the vote on the referendum about Great Britain’s pullout from the EU reflect the disconnect between the attitudes of the elite vs. the general public and could trigger a chain reaction across Europe. For this reason, Brussels needs to abandon its efforts to further integrate Europe and instead contemplate how to rebuild the European project, while the United States should reconsider its relationship with the EU as well as its own avenues of engagement».
So, we have the rejection of further expansion of the EU and the reconstruction of the entire European project.
And of course, the British referendum results will automatically bolster the Eurosceptic positions in the leading EU states – Germany, France, and the Netherlands – especially given the upcoming general elections there. And their biggest argument is becoming the discontent with the massive and uncontrolled influx of migrants (in 2015, Great Britain got 330,000 migrants just from EU member states alone).
Certainly, the impact of the Brexit will vary by individual EU state, but the general pattern seems to look like this:
– Hungary and Sweden will lose a strategic EU ally.
– In Germany, the Brexit is seen as a serious blow to «European morale».
– Slovakia, Romania, Poland, and Lithuania are concerned about the future fate of their own citizens in Great Britain (about 100,000 Slovaks alone live there).
– Ireland, Spain, Greece, and Cyprus see the economic fallout from Britain’s EU departure as the biggest threat.
– In all other EU countries (with the possible exception of Portugal and Bulgaria) the top concern is the rise of public Euroscepticism. For example, Austria’s Freedom Party, whose candidate came one step away from winning the recent presidential election, has already demanded a referendum there about leaving the EU.
However, before some new country asks to follow the UK «out the door» from the EU, the very United Kingdom itself might cease to exist. Some influential political forces in Scotland and Northern Ireland now very seriously intend to hold their own referendums on independence, and very soon.
This report prepared by Pyotr Iskenderov for Strategic Culture Foundation.