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Friday, January 11, 2013

Osborne's "reform or bust" remarks only get a page 10 hit in Die Welt

A month or so ago, David Cameron suggested, for the first time, that UK exit from the EU was "imaginable". Today, in an interview with Die Welt, and as we reported in our press summary, his Chancellor, George Osborne, has been far more explicit. Here's the relevant bit:
"I very much hope that Britain remains a member of the EU. But in order that we can remain in the European Union, the EU must change."
He added:
“I want to be an active part of a reformed EU. Europe and the UK need each other and our economies are very closely intertwined…More than half of British exports go to the EU, we sell more to Nordrhein-Westfalen than to India”.
“There are areas where we want the EU to do more. We want the internal markets for services, for digital services and for energy to be advanced and finally completed…We have plenty of ideas for Europe, but often it is frustrating that these ideas are not implemented. And we would wish that Germany would support us more strongly to push forward these ideas.”
Osborne's remarks are intellectually honest and reflect where the vast majority of his party and the British public stand, but it is also the first time that the Government has been so explicit in stating that the UK might face no alternative to exit if the EU proves unwilling to reform and meet the concerns of a country that has refused to embark on the euro project.

It is also a good thing for other EU politicians to understand where the UK, and particularly David Cameron, is coming from. But there is a balancing act here. As we've seen from the widely reported comments by Gunther Krichbaum, Chairman of the German Bundestag’s European Affairs Committee, Germany is very sensitive to the perception that it's being "blackmailed" into granting the UK specific concessions. As we mentioned in our previous blog posts, this is why pitching Cameron's EU speech as good for Europe, not solely the UK, is vitally important.

But the most interesting part of the Osborne / Krichbaum remarks, is the contrast in the media reactions in both countries to the interventions. This speaks volumes for the esteem in which each country views itself relative to the reality. Krichbaum, an important but largely domestic political figure, got a front page hit in the Times:

Osborne, the UK Chancellor, was buried on page 10 in Die Welt (in the economic section), despite issuing what could be seen as an ultimatum.

It shows that the UK at large needs a dose of self-confidence. The British audience should not be surprised if German politicians say they won't be blackmailed. This is both a long-standing German diplomatic stance (they won't be blackmailed by France, Spain, Italy, etc either) and pre-negotiation posturing. 

It also shows that it's time for everyone to breathe and calm down.


Rik said...

The interview at least part thereof was in Handelsblatt as well. In other countries basically only Cameron is known and only from countries like the US (well there is only one) people know Foreign or Finance ministers.

On Germany not letting itself be blackmailed, one only has to look at Greece to know that at the end they will. You won't make friends but at the end of the day it is a very credible plan B if necessary.
Only brought of course in the nicest possible way.

What they are really thinking. Well they probably donot like another European issue and would like if everybody just followed the leader.
The full picture with a proper analysis simply looks not yet made.
You see nowhere that the largest trading partner of the EU after a Brixit would be the UK. It simply looks like they still donot get the picture straight. As with Greece where it took more than a year before they realised that it would look rather bad for the European project; it was a legal issue as the EZ basically doesnot allow exits; and markets might react. In general the same sort of things as with the UK (only there likely more than with small Greece.
Probably good the communicate further on that.

Anyway this looked like the most likely way they would start. Before Cameron's speech and with a no way Jose.
Pretty stupid to bring the referendum up in the referendum=populism way Will hardly make a positive impression on the average UK voter except that the club stinks.

I would say that the best way from their side to deal with it is getting the thing done asap and keep an as low as possible profile. If they will do that as we see with say Cyprus they first put it on the frontpage and later realise that less media attention might have been better. The whole rescue hangs now on the believe of markets that the ECB as basically as strong a CB as the FED. It isnot by far and a big country leaving the EU will put the spotlight on that with very likely negative consequences (imho likley considerably worse than Greece. The UK issue will bring the credibility of the whole rescue in doubt (with major countries walking away), Greece leaving is more a dysfunctional country/basketcase leaving and not a nett contributor.

Rollo said...

I reject entirely that the UK is blackmailing Germany or the EU. We pay huge amounts, and incur even greater costs, to belong to this club. And the club is so badly run that it brings us no benefit. So we say: we will leave this club unless the club changes so as to be beneficial to our country and our taxpayers.
If the club rules do not change to accommodate us, we should leave forthwith. We should not be blackmailed by others into continuing to prop up this lame duck.

crapshooter said...

It's no surprise that George Osborne's interview only made page 10 of Die Welt. When William Hague made a speech on the EU in Berlin a couple of months ago neither Die Welt nor any other German newspaper reported it at all. The reason is simple. The
German media are not that much interested in Britain. Open Europe needs to remember that our relationship with the EU, which to pro-UKIP bloggers and commentators is the stuff of life, is in Germany a sideshow. The German government and the German political class are focussed on the survival of the euro. Whether we choose to stay in the EU or not is, by comparison, a lesser order distraction. If they can find a simple fix to help us remain a member they will. But they're not going to spend months or years negotiating about it. They've got more important things to worry about.