An Economist reader had a novel, if improbable, solution to the UK’s Brexit woes. Britain should simply become the 11th province of Canada. This, a Mr Ted Stroll argues, would allow Britain to have its trade cake and eat it too.
Canada and the EU have a trade agreement and the UK would accede to it as a Canadian province. It would also join the North American Free Trade Agreement (NAFTA) and enjoy liberal trade terms with the United States.
Canada’s provinces have wide powers and by treaty the UK’s could be even broader, he suggests. The Queen would remain head of state, Britain could keep the pound and English, together with French, would be the official language.
Mr Stroll points out that such a move would not be unprecedented. Newfoundland left the UK and joined Canada in 1949. Time to think outside the box, he concludes.
Maybe so. But somehow I don’t think the idea will cut much ice with Theresa May, or whoever is Prime Minister after 8th June. Let’s hope not anyway: If the UK ceased to be a sovereign state what would happen to Gibraltar’s sovereignty?!
Rather more serious food for thought comes from the President of the European Investment Bank (EIB), the world’s largest international public lending institution.
Brian Unwin notes that if Britain leaves the EU it will cease to be a member and shareholder and will no longer be eligible for EIB finance unless there’s a treaty change, which he considers unlikely, or the bank’s governors agree unanimously to continue financing projects in Britain. This would depend on the outcome of the Brexit talks.
There is therefore, according to Mr Unwin, a serious risk that Britain will be denied a major source of long-term, low-cost investment financing. Over the past eight years the EIB has committed €40 billion to projects in the UK.
The EIB President says that, at a time when Britain will desperately need to retain the confidence of external investors to promote economic growth and employment and to help finance its current-account deficit, the loss of EIB finance could be another unintended but damaging consequence of the British government’s hard Brexit policy.
It would also be bad news for the Rock if we’re looking to a cash-strapped UK for financial assistance post-Brexit.