The Cost of Going In

The Malta Independent on Sunday



As we enter the final phase of the negotiations for accession to EU membership I regret that the quality of the domestic debate about the matter remains shallow, often getting shallower.

The pro-EU front uses two abstract arguments which play on emotions but remain scant of hard facts.

The first argument is the inevitability of the case. Basically they propose to stop arguing whether it is good or bad and as a matter of fact accept it as something inevitable. So we should just try to make the most of it. This leads us to sing glory whenever our negotiators are given temporary or permanent concessions to keep part of what we already have. `The pro-EU front uses two abstract arguments which play on emotions but remain scant of hard facts.`

Secondly is the argument that in spite of the sacrifices involved this has to be seen in the long term for the good of our children. This argument works especially on the under 25`s who consider EU almost as a matter of fashion, and the over 65`s who are normally influenced more by their grandchildren than their own children.

Both arguments are challengeable.` EU membership is neither inevitable nor a sure winner in the long term interest of our children.

I am not one who would create gloom or doom scenario for either going in or staying out. Both options create their own threats and opportunities and in many ways it is our ability to grasp such opportunities and acknowledge and address our weaknesses which will make a difference between success and failure.

Indeed the stronger argument for EU membership is that due to the mediocrity of leadership which our political class has given us these last 20 years, barring labour`s recent short interlude, we have rendered ourselves as our own worst enemies and need an external agent to sort us out. This argument is not only challengeable but self-degrading and viciously deceptive. `If the case is analysed with the logic and coolness it deserves, it is indeed difficult to justify its benefits.`

If the case is analysed with the logic and coolness it deserves, it is indeed difficult to justify its benefits.

This week there were three particular instances which continue to underline the high cost of going in and the consequent benefit of staying out.

Take the issue of soft drinks in plastic bottles. One of the more sensible decisions this country took regarding waste management was to bar bottling of soft drinks in plastic containers. All these are in glass re-usable bottles and a small quantity in aluminium cans which can be re-cycled. Pity indeed that we did not insist on the same standards for mineral water which on its own creates tons of non-organic plastic waste which has to be disposed of without re-cycling.

We have learnt that the EU is insisting on our giving full market access to imports (and consequently local production) of soft drinks in plastic bottles in the interest of uniform single market practice with no regard being given to environmental consequences created by such a decision in our own particular circumstances. Absolutely indifferent to the principle that prevention is better than cure, we will in due course have to invest in non-organic waste management systems to adhere to EU environmental standards of problems which could have been avoided at source by staying out.

We have also learnt that the EU is insisting that we build strategic oil storage reserves in line with their standards. Much as desirable, the country has much more urgent priorities than spending some Lm20 million to build such storage capacity. Experience has shown us that our best strategy for non-interruption of strategic supplies is our foreign policy of neutrality rather than physical onshore storage facilities. Yet we have to adhere, increasing the costs of going in and the savings of staying out. `Some might argue that we don`t have what it takes to discipline ourselves, to which I would answer that it depends whose leading us.`

Our negotiators also informed us that they are still making heroic efforts to get a permanent derogation from the obligation to impose VAT on food and medicine but at the same they let us know that if they don`t succeed VAT will be introduced at the lower permitted level of 5% and that compensation will be given for the consequential cost-of-living impulse. What they failed to tell us is that 1% VAT revenues, including that applied on food and medicines will be absorbed by the Central EU budget, and that any compensatory adjustments to the cost-of-living impulse will weaken our competitiveness in the export markets. Again this is the cost of going in and the benefit of staying out.

Three cases in one week which repeatedly bring up the question of where is the beef in the membership option. Wait till we know what funding we will be entitled to, some may argue. Fair enough we have no option really but to wait, but the soundings are pretty evident.` The Commission has assured us that we will not be net contributors (some miles off getting a cool hundred million each year) and that the budget for 2007 ` 2012 will no longer be agreed by consensus but by qualified majority.

Staying out does not mean we isolate ourselves through inward looking policies. It means trading freely with the largest possible variety of economic blocks and applying through self-discipline those EU standards that make sense for our circumstances in a tempo that does not prejudice our international competitiveness or tear apart our social cohesion.

Some might argue that we don`t have what it takes to discipline ourselves, to which I would answer that it depends whose leading us. The present government certainly lost all sense of discipline. But then that`s what elections are for!

Alfred Mifsud