Mark Leonard (European Council on Foreign Relations)
The May general elections in Britain determined the fate of the referendum on EU membership. Brexit is real and the reason is not a Eurosceptic society but a Europhobic stance of some elites, which limit EU-related issues to the question of migration. Prime Minister David Cameron is under pressure from the Eurosceptics in his own Conservative Party as well as from the UKIP, whose influence grows. On the other hand, conservatives and liberals want to make Britain a more constructive member of the Union. Both sides would support the referendum only if the new government signs a deal, which transfers sovereignty from Westminster to Brussels.
Without Britain, the EU will be smaller, poorer and less influential on a global scale. Britain is a military superpower with great expenditures on security and research. In addition, London serves as a global finance and media center. At a time when the Ukraine crisis is still fiery, it is important for the EU to maintain the position of a stable power. Brexit would become a dangerous precedent – Britain’s exit has been opposed not only by European leaders but also renowned companies that benefit from the single market. The UK is risking its own position because it would have to rewrite the existing legislative framework and negotiate the terms of its relationship with the EU once again. Brexit would also mean more uncertainty for immigrants and investors. The Japanese government has already issued a warning that the Britons working in Japanese companies would lose their jobs. Also the future of the peace process with Ireland, hitherto facilitated and backed by EU membership, would be called into question.
There are many ways to prevent Brexit. However, a special treatment could encourage similar demands in other countries and therefore, Britain must be persuaded to lean towards a greater European reform and to participate in its negotiation. The UK is also needed to solve the controversial issue of migration without restricting the free movement of persons. The creation of a migration fund for assimilation is an ambitious plan, which could be opened for all Member States. The EU institutions should emphasize the benefits, which the EU can extract from this and other projects. A good example is Juncker’s investment plan, which could be utilized by the governments by linking it with their objective to invest into infrastructure and research, not to mention the benefits of free trade and the comprehensive free trade agreements with countries such as the U.S. and Japan, which could exert some influence over the trade conditions with China.
(The study can be downloaded here)