Brexit: Implications for Ghana and Africa

Thu, 9 Jun 2016 Source: Sakyi, Kwesi Atta

I assume that currently when some English and UK residents look over their shoulders, they shudder and trepidate at the spectre of the historical resurgence of the imaginary invasion by swarms of Huns, Normans, Romans, Vikings, Vandals, Visigoths and Ostrogoths, Gauls and Franks, and all manner of aliens who are either fleeing the ravages and savagery of war, or fleeing from dire economic straits prevailing in their countries in Africa, Asia, and from other parts of the world. Many of these migrants and refugees are lured by the glare of an opulent and civilised society which has a penchant and panache for law and order.

The British Isles for thousands of years has been a theatre and a romantic place for foreigners looking for economic spoils, business opportunities, among other motives for journeying there. Perhaps, the Union Jack epitomises this cultural cauldron of a melting pot of cosmopolitan cultures and civilisations, where all crossroads converge at an epicentre of global activity. The UK has for long been a hub and incubator for innovation, financial services, quintessential quality education, industry, cutting-edge research, and above all an ocean of stability. As such, its renown has drawn to it globe-trotters, tramps, vagrants, migrants, refugees, pilgrims, and all hues of people with different religious, political, and economic persuasions.

This article has been necessitated by the fact that the British go to the polls on 23rd June 2016 to vote in a referendum whether to stay in the European Union (EU) or opt out of it. It is a momentous event and occasion for the rest of the world, and nobody outside the UK has the right to tell the British what is good for them. Therefore, this essay is just an academic exercise from someone who has grown up in a former British colony, Ghana, lived and worked in two other colonies, Nigeria and Zambia, and was educated under the British education system in Ghana and South Africa.

At this juncture, one recalls the history of the invasion of Britain by the Spanish Armada in 1588, the Napoleonic Wars of the 1780s, Hitler’s botched attempt to invade Britain under the Blitzkrieg,

and of course the Norman Conquest of William the Conqueror in 1066, as well as the Roman General, Julius Caesar in 55 BC. Britain’s engagement with Europe has been long and eventful, perhaps antedating recorded history. Britain as a country has weathered many boisterous storms of internecine wars, overcome the Great Fire of London in 1666, overcome secession and succession wrangles, overcome the Bubonic plague and the Black Death, survived then travails and woes of administering a vast empire across the globe on which the sun never set, from Australia to Canada, Cape to Cairo, and is now one of the greatest countries of our time.

In 1957, the Treaty of Rome ushered in the European Commission, succeeding the smaller constellations such as Benelux (Belgium, Netherlands, and Luxembourg), European Free Trade Area (EFTA), and the European Coal and Steel Commission. Before and during the World Wars of 1914-1918 and 1939-1945 respectively, alliances and groupings had taken place such as the Triple Entente, the Triple Alliance, and the German-Italy alliance, among others. Many treaties, both bilateral and multilateral had been negotiated and signed under a flurry and spate of ultra-diplomacy and internationalism during a period of adjustment, accommodation, rapprochement, appeasement, and pacifism.

The maze and mosaic of alignments became so confusing and criss-crossing such that there was need for a shake-down. The upshot and distillate is the EU, formerly known as the EC, ECM, and EEC. Great minds of the time had sought for the super-formula or panacea which would end all wars. Among the negotiators and behind-the-scenes diplomats and statesmen who were instrumental in founding the EU, we can mention people such as Sir Drummond, Sir John Maynard Keynes, Jean Monnet of France, an industrialist, diplomat and budding entrepreneur and owner of Cognac, Walter Hallstein, Foreign Minister of West Germany, Chancellor Konrad Adenaur, Clement Attlee, among others. The Second World War showed that the policy of appeasing Hitler was wrong.

After Woodrow Wilson had been instrumental in the establishment of the League of Nations, America entered into a period of withdrawal and isolationalism, or political comatose, emasculating the League of Nations. At least a great foundation had been laid for its successor, the UN. America paid dearly for her policy of isolation when in 1941; Japan launched an onslaught on Pearl Harbour Naval base in Hawaii, which opened the Pacific front where General MacArthur and his American troops fought gallantly. It taught a great lesson in being my neighbour’s keeper. It showed that the policy of playing solitaire or Tartuffe or curmudgeon can be counter-productive sometimes.

Perhaps the accession of the UK to the EU in 1973 was politically correct at the time, and perhaps it will be politically correct now to stay or pull out. It is a matter of either building or burning bridges, depending upon the stakes at stake. Many have been the academic questions which have been posed to students on the pros and cons of staying in the EU or parachuting out of it. It took Britain 16 years to join the EU in 1973, and it is now contemplating either staying or pulling out after being in it for 43 years. What are the experiences? What must have gone amiss? What events in the broader socio-politico-economic landscape have informed this decision at this point in time? What are the political manifestoes and policy expectations of the major political parties and pressure groups in the UK on this referendum? I will not attempt to answer these questions as they are sub-judice and moot.

A sage once observed that marriage is such an institution whereby those who are in wish to get out and those who are out wish to get in. What will the outcome of the June 23 referendum do to inform such non-Euro nations in Europe? What good or evil has accession to the EU done for the weak economies of the PIGS (Portugal, Italy, Ireland, Greece, and Spain)? For a long time in the world, the EU has been held up as an iconic model of regional integration and a trading bloc. How do EU stringent fiscal and monetary rules and policies impinge and impact on the economies of member countries? What happened to the Common Agricultural Policy (CAP) whose over-subsidisation created Butter Mountains and Wine Lakes across Europe? How did it wreak havoc on the exports of poor countries in the developing countries whose farmers did not enjoy the luxury of government grants, subsidies and export guarantee insurance?

Even almighty America complained of the subsidies as restricting free trade, impoverishing many poor peasant farmers in the world, and creating an uneven playing field. Economists cried foul that it limited the principles of free trade as advocated for by Ricardian, Herscher-Ohlin, and Adam Smith’s capitalist ideology expounded in his Wealth of Nations tome of 1788. They said it led to a misallocation of scarce resources, distortion of prices, and against many rounds of trade agreements in the past such as the Uruguay Rounds under GATT and the current dispensation under WTO which calls for abolition of all trade barriers, tariffs, quotas, and the artificial massaging and manipulation of free market forces. The EU was using its policies to protect jobs within the EU, thus condoning inefficiencies and flouting competition rules.

Perhaps, after the fall of the Berlin Wall in 1989, the dismemberment of the former USSR through Gorbachev’s Glasnost and Perestroika in 1990, the balkanisation of the Balkans, dismantling former Yugoslavia, and the conversion of most Eastern European countries into capitalism and free market, the need for collective security is no more felt now in Europe. Britain can now go back to its Trans-Atlantic Alliance and look up to NATO and the Pentagon. Besides, Britain will find it much to its self-interest and gratification to call the shots from Whitehall in London, instead of being tied tightly to the apron strings of the EU in Brussels and Strasbourg. Should Britain vote to exit EU on 23rd June, 2016, it will be like the end of a great marriage which ends in a great divorce proceeding, with the offspring of the marriage being the worse off on the one hand, and on the other hand the offspring crossing themselves over for coming out of a harangue of marital wrangles, whining, and bitter-love relationship.

It will be like a man coming out of a petticoat or kitchen cabinet, and having all the freedom in the world to find enough space to swing a cat without the ever-prying eye and incessant running commentaries from his wife. Good riddance of a beautiful nonsense called marriage of convenience. On the other hand, if Britain votes to stay, she will continue to carry the excess baggage of the Commonwealth into the union, and also suffer self -effacement of not being sovereign enough to make their own mistakes and learn from them.

There is some conspiracy theory in some learned circles that the EU was initiated and foisted on Europe by some powerful people to force France and Germany to live together peacefully as neighbours and stop being at each other’s throat all the time. In fact, Otto von Bismark, the German Chancellor in the 1880s,had said that the question of German unification would be achieved by blood and iron, and by extension, German’s expansionist policy. That policy seemed to have spilt over during the era of Kaiser Wilhelm and the Fuhrer, Hitler. Germany and France are now the champions of the EU and they gain a lot from their mutual bilateral and multilateral cooperation.

The thawing of the ice in Sino-West relations, lifting of a 50 year trade embargo on Cuba by the USA, and other geopolitical happenings of late means that a new vista has opened up for Britain to deepen bilateral relations with China, the current economic powerhouse, and EU policy strictures stand in the way of forging many beneficial and mutual bilateral trade agreements with some of these emerging markets. Britain offers many intangible exports by way of services which China and other countries can buy into without having to comply with EU trade creation and diversion rules.

Besides, the British pound sterling has remained a stable currency which attracts world investors, and China is currently the world’s leading investor and market. Britain can win many lucrative contracts in China without going through the rigmarole clearance of the EU Commission, or imposing on itself severe caps on its monetary and fiscal policies. For example, once in a while, a country can choose to engage in quantitative easing or monetary expansion in a period of rapid economic growth, but the EU puts a cap of 5% fluctuation up or down on budget surpluses, deficits, inflation, deflation, among others. Economists point to freedom of choice as enhancing welfare. Britain will like to break out of its cocoon or mould to explore outside the box. If Britain opts out, it can choose a loose alliance or a marriage of convenience of cohabitation.

Many sceptics in Britain, especially the older population, fear that Britain is increasingly losing its cultural identity due to the influx of migrants and refugees. They think Britain is being europeanised by cheap labour imports from Europe who come to do menial and manual jobs on farms and construction sites, and as security guards, baby-sitters, cleaners, artisans, bartenders, drivers, social workers, among others. Some questions to ponder as Britain goes to the polls on 23rd June 2016. Chatham House in London reports that the UK loses 350 million pounds every week for being in the EU. If so, what a colossal economic haemorrhage?

1. Is Britain facing Europeanization of Britain or the EU is facing Anglicisation of its policies?

2. How long can Britain subject its sovereignty to the EU?

3. Why has Britain since 2000 not joined the euro currency zone?

4. Is Britain’s national sovereignty at crossroads with supra-national hegemony of the EU Parliament and Commission?

5. Where does Britain stand with the Commonwealth and its DFID, UKAid, and other overseas programmes?

6. What are the gains and losses should Britain exit the EU?

7. How will Britain’s action cause a domino effect on the EU and other trading blocs such as ECOWAS, COMESA, AU, among others?

8. Will Britain leaving the EU free more aid for Ghana and Africa?

9. If Britain leaves, what impact will it have on International Governmental Institutions such as the UN, IMF, World Bank?

10. So far judging from pre-EU and post-EU, which position is better for Britain?

The writer is a Principal Lecturer and Head of Research at Zambia Centre for Accountancy Studies, Lusaka, Zambia.

Columnist: Sakyi, Kwesi Atta