The Malta Independent 17 July 2019, Wednesday

An A plan for Brexit

Thursday, 10 March 2016, 10:59 Last update: about 4 years ago

It is in Malta's interest to prepare an A plan for Brexit.

Up to some days ago, it would have been thought prudent to prepare just a B plan for Brexit but the continually evolving situation now makes it in Malta's interest to prepare contingencies in case the British people vote to exit from the EU.

We are not trying to pre-guess what the final outcome will be and this, anyway, is out of our hands.

But Malta has some serious preparations to make in case the British vote to exit from the EU.

On the State level, Malta will hold the presidency of the EU as from next January and, in case of a Brexit, will find itself completely immersed in tackling the fall-out.

Holding an EU presidency is onerous anytime, but if Brexit it is, Malta's six-month stint will be increasingly taken up with meetings after meetings as the Union gets to cope with the resulting chaos.

Malta, like the other Member States, does not interfere in the internal matters of other Member States, and in fact the only official comment that has been made regarded only the impact of a Remain/Brexit decision on Maltese nationals residing in the UK.

Malta and Britain are linked by historically strong ties over the past centuries, by trade, by educational links and also by tourism links going in both directions. These ties have survived the test of time, (and were strengthened in the dark days of World War II) and no amount of Brexit can undo them. There was a time when Britain was in the then EEC and Malta was outside. There was also a time when British forces were practically forced off the island, and yet the relations between the two countries remained strong.

Inside the EU, there were many occasions when Malta and the UK saw eye to eye on so many issues, but there were also instances when the two went their separate ways, such as on joining the euro.

Even on a bilateral level, it will not be so easy to unravel the many legal documents that now bind the UK to the EU but which will have to be renegotiated on a country by country basis in case of Brexit. This does not mean this cannot be done, but it will be hard work.

With the UK out of the EU, Malta will lose an ally on so many fronts. The most signal of these alliances are in the financial services sector where Malta and the UK have fought off, so far, taxation on financial transactions (FTT). With the UK out, it may be harder for Malta to resist the pressure by the bigger countries on the continent. The last news is however that what was, until a short time ago, a united pro-FTT front, has begun to suffer from some cracks: Estonia shifted its stance and so, it seems, has Belgium. Still, a British presence in the EU would have helped.

It goes without saying that a continued British presence in the EU could have served to balance out the predominance of Germany and maybe too that of France. Europe without Britain is not the real Europe. Maybe it was premature for David Cameron to submit the issue to a popular referendum and maybe too the issues which were not really patched up at the recent summit could have been solved without a referendum.

It would be wrong, in conclusion, to look solely at the opportunities of attracting many British companies to Malta so as to passport their presence in the EU. This opportunity does exist and countries such as Ireland and Luxembourg are gearing up to benefit from a Brexit. This is precisely one other reason why the British must not choose Brexit.


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