Swiss Model

The Malta Independent

Swiss Model

The main indicator that the electorate is getting less and less convinced on Malta`s EU membership project comes from the evolution of the arguments promoted by the two political schools.

The Government, embarked as it is on an irreversible trip `for EU membership as quickly as possible whatever the cost whatever the consequences, is being forced to promote the TINA argument.` TINA, acronym for `there is no alternative`, was coined in the early days of Margaret Thatcher premiership when she used it to argue that only tight monetary policy could eradicate inflation and prepare a solid foundation for new productive investment.

As the argument and discussion on EU membership deepens, the defects and` costs of such a `regardless` decision are becoming more evident. Lost for any other positive arguments, the one left at Government disposal is TINA.` Either full membership or complete isolation.

For the Government, Labour`s Swiss model alternative is equivalent to complete isolation. For the Government the only patch of greenery is in the EU. For the government Switzerland, Norway, Iceland indeed the rest of the non-EU world are living in a state of isolation.

When I recently took the initiative and whilst explaining my vision of the Swiss model I urged Labour to start fleshing out its model in a positive and detailed manner the isolation argument was turned by Government` 180 degrees in an act of glaring inconsistency.

Not only the Swiss model I envision is not isolationist but would envisage extending the free trade areas with the EU in two directions. Firstly by avoiding the Customs Union with the EU,` Malta can extend the Free Trade arrangements to other economic areas.` This would render the Swiss model much less isolationist than the EU model as the customs union condition, a corner stone of the single market in the EU model, would prohibit any such arrangements.` Secondly the free trade agreement ( as distinct from the rigid` single market concept) with the EU could be gradually be extended, over an appropriate time-scale to avoid economic shocks, to other sectors including services, contracting, and free movement of labour.

The argument that this would bring the pain without the gain is fallacious and hollow. Those who consider the gain as the funding we can get from the EU had better look a bit closer. As a nation, as distinct from on a government basis, we will be net payers to not recipients from the EU especially if the EU is enlarged eastwards thus brining the average GDP at purchasing power units very close to our own. The gains of the Swiss model is the possibility to trade with the rest of the world out of the straight jacket of a customs union; to promote international trade` free from the shackles of the single market concept which would force us to be just like other EU members. Our economic advantage is in being different without being isolationists.

The off-handed manner with which the Government is writing-off the Swiss model exposes the defects in its arguments for the EU model.

Alfred Mifsud