A Norway model of Brexit would fail Leavers and Remainers alike
PUBLISHED: 07:00 04 May 2019
As Britain drifts towards a possible 'Norway Brexit' LARA SPIRIT travels to the Scandinavian country to discover why this would be the worst destination of all.
As Liam Fox put it in a letter to Tory MPs earlier this month, if the UK was to end up in a customs union, “we would ourselves be traded”. He added, quoting a saying used in Brussels, “if you are not at the table, you are on the menu”.
Very well put, Dr Fox. Yet this is where the UK is apparently headed. Britain – even the international trade secretary, it seems – is finally facing the reality of Brexit. It can choose the concept of 'control' above all else – and accept the economic harm which would follow departure from the world's largest free trade bloc. Or it can leave the EU while staying closely aligned to it – avoiding the worst of the damage to the economy, but without a seat at the table, with no ability to shape and influence policy, and at the mercy of others.
The second option appears to be the direction in which the government is moving, with some version of what has been dubbed 'common market 2.0' or Norway Plus. This would leave the UK in a similar, but not identical, position to Norway – the 'plus' indicates that the UK would also need to add a comprehensive customs arrangement to maintain common external tariffs and prevent a hard border in Ireland.
A version of this arrangement – without the plus – seems to be OK for Norway, so would it work for Britain? After all, the two countries have, in some respects, shared a similar path, even if they have taken different routes.
Both were founder members of the European Free Trade Association in the 1960s, before being rebuffed in their efforts to join the European Community by France.
Both then held referendums about becoming full members in the 1970s. But while the British opted to do so, the Norwegians declined, in a plebiscite in 1972 (by 53.5% to 46.5%). Norway did so again in 1994 (this time by 52.2% to 47.8%), although the same year it did join, along with Britain and the rest of the EU, the European Economic Area. This has formed the basis of Norway's relationship with the EU ever since. Through membership of the EEA, Norway has access to the EU's single market, but the arrangement also requires Oslo to incorporate around 5,000 of the 23,000 laws currently enforced by Brussels.
There have been occasional murmurings of opposition to this status – largely from the Norwegian left – but, on the whole, the country seems relatively satisfied with the arrangement.
Ellen Bramness Arvidsson, director of Finans Norge – which represents financial services companies – said: “The Norwegian financial sector is extremely positive towards the EEA agreement because it does give us total market access. When we adhere to these rules we are a part of the internal market like members are.”
Jonas Gahr Støre, the leader of the Norwegian Labour party and a former minister for foreign affairs, described it as “a very Norwegian deal”.
“It has been a national compromise short of membership, which gives us access to the internal market and all the four freedoms – people, goods, services and capital. The exception is agriculture and fish, which remain outside. But we have access to the market and a level playing field.”
Though it was overtaken by Nordic neighbour Finland in the rankings this year, Norway has consistently bagged top spot on the World Happiness Index. The country draws admiration for its strong social democratic tradition and it has some of the world's highest living standards, helped by its North Sea oil and gas resources. Norway, then, seems pretty content with its lot, including its status as an adjunct of the EU. Could a restless, divided Britain benefit from such a pragmatic solution, then?
Kjetil Wiedswang, a commentator at Norwegian business newspaper Dagens Næringsliv, suggests not. He has been observing Britain's relationship with the EU for 30 years and says there have been repeated instances of many in Britain being tempted by the so-called 'Nordic model'. The problem, he believes, is that it is not really available for the UK.
“(When it has been suggested before) People have lined up and said, 'well OK, if you're a small, peaceful, basically conservative, protestant, oil-rich country then you should do it like us',” he said.
But Britain does not share many characteristics with Norway. It doesn't have a trillion-dollar sovereign wealth fund and has more than 13 times the population. What works for Norway is not the same as what works for Britain.
A Norway deal would also not solve the issues that many thought Brexit would address. For those who believed a Leave vote in 2016 would mean no more freedom of movement, an end to being subject to laws laid down in Brussels and total freedom to strike trade deals with the rest of the world, following the Norwegian route is going to leave them sorely disappointed.
Norway accepts all four freedoms in return for access to the single market. In order to avoid a hard border between Ireland and Northern Ireland, common market 2.0 would require a customs union too – precluding any ability to strike our own free trade deals.
And while Brexiteers will be frustrated, a Norway solution is no more enticing for us Remainers. While it might protect freedom of movement – something which deserves to be embraced, not eliminated – the arrangement would simply mean we keep some of the benefits we enjoyed as full EU members, but without a say in any of the decision-making processes.
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It would leave millions of Leave voters disenfranchised, as a result of the UK having failed to 'take back control', and millions of Remain voters angry at losing their voice.
Norwegians accept their status as a pragmatic solution for a prosperous country. Debate about Europe in Norway has not reached the same feverish levels it has in the UK. You will not find a steady stream of stories in Norwegian newspapers blaming Brussels for bendy bananas and enfeebled vacuum cleaners. Yet while they are content with their status, Norwegians are under no illusions that it renders them rule-takers, not rule-makers.
They sometimes refer to themselves as a 'fax democracy', where they are left to wait by the details of new rules and regulations to arrive from Brussels. Tore Myhre, Deputy Director of the Confederation of Norwegian Enterprise, explained that even if they take part in the early stage, 'we are not there when the decisions are made'
Attempting to exert any influence, as a non-member, is challenging and limited. While Norwegians might be involved in the early stages of discussions about legislation they will be subject to, they are not present when the decisions are made. And, as Liam Fox reminded us, when you don't have a seat at the table, you are on the menu.
Ellen Bramness Arvidsson, from Finans Norge, says the country needs to find creative ways to lobby and shape policy, when they have no final say. Norway has the opportunity to participate in the preparatory stages of legislation. But it when it is returned from Brussels, she says, “you will, on the EFTA side, sit down together with this piece of legislation and discuss how it should be implemented into the EEA. The room for manoeuvre here is extremely limited, That's when you realise, you're a rule-taker.”
Heidi Nordby Lunde, a Conservative MP, said that Britain, were it to follow the Norway route, would be “downgrading” its European status, moving from “platinum standard to silver standard”.
Defenders of a Norway-style deal in the UK talk up the ability for EEA countries to veto any new laws which arrive on their doorstep. This is misleading. Norway has never blocked any laws handed down to it. To do so would unpick its relationship with the EU, and no-one is quite clear where that would lead.
“We've never used the right to not implement [new rules and laws] because we are afraid of what the EU may do and that the whole agreement would collapse, because it's fragile,” says Kjetil Wiedswang, from Dagens Næringsliv.
Nick Boles, who quit the Conservatives last month to sit as an independent MP, is an advocate of common market 2.0. He has said that Britain would be able to exercise the 'right of reservation' as a member of the EEA and cited a postal directive as an example of Norway declining to implement a Brussels law. In fact, under intense pressure from the EU, the directive was ultimately implemented.
If Norway does decide to resist new legislation, says Wiedswang, it will face “countermeasures” from the EU. Such countermeasures have implications for all members of EFTA, so many Norwegians are understandably wary of letting the UK into their club in the first place.
“Some are afraid of the Brits, like some kind of low-flying Dumbo in a china shop,” Weidswang said.
Indeed, such wariness is a significant factor in considering whether the Norway option would fit for the UK. British advocates of the plan insist that, because we are a much larger than Norway, our weight in resisting EU legislation will be greater.
This might be true, but is it desirable for the rest of the countries in Norway's bloc? Switzerland, Liechtenstein and Iceland will not want to suffer because of Britain's churlishness.
The fear is that these countries will see their relatively smooth-running arrangements hijacked by a truculent Britain, looking to throw its weight around and flex some muscles after the humiliation it has received during the Brexit process.
When Heidi Nordby Lunde raised these concerns in an interview with Channel 4 News in December, the clip went viral. She explained why Norway would be reluctant to let a recalcitrant Britain into their club and, writing in the Guardian, argued it wouldn't be in Norway's interest to let us join EFTA, comparing it with “inviting the rowdy uncle to a Christmas party, spiking the drinks and hoping that things go well. They would not”.
Indeed. And if Britain did somehow find itself in this position, having followed the Norway route, it would soon wake up with the mother of all hangovers.
Amid the maddening uncertainty of Brexit, and the failures of politicians to reach an agreement, the Norway option might seem a safe compromise – a fudge that will allow the country to move on. It won't be. It would fail Leavers and Remainers alike, leaving the UK with no control, and no voice.
The young people in our organisation aren't willing to accept a deal which surrenders our seat at the table. We don't believe moving forward with Brexit can be done with a deal which does the opposite of taking back control and which leaves us as rule-takers. And we don't want to see such a deal stitched up by parliamentarians, without the consent of the British people. The Norway deal has worked well for Norway, but it is not right for Britain.
• Lara Spirit is co-president of Our Future, Our Choice