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Analysis

What Macron’s speech means for Brexit

by Paul Taylor | 27.09.2017

Paris: French President Emmanuel Macron set out sweeping ambitions for much closer European integration after Brexit on Tuesday and said he hoped the UK would eventually find its own place in “a refounded Europe”. EU leaders cannot afford to stand still and watch Euroscepticism and nationalism gain ground but must seize back the initiative with bold steps to strengthen unity.

Here are five takeaways from the French leader’s 100-minute speech that are relevant to Britain’s relationship with the EU – whether it quits, as planned, or ultimately finds some way of staying in the club.

Eurozone as vanguard

Macron doubled down on his call for a finance minister and a common budget for the 19-nation eurozone, which he said should be funded by new European digital and environmental taxes and a harmonized Europe-wide corporation tax. The proceeds would fund joint investments and act as a shock-absorber in crises. He rejected criticism that a more integrated eurozone would leave EU countries that are not in the monetary union as second-class members, saying all would eventually benefit when they joined the single currency.

Social and tax harmonisation

Denouncing a “race to the bottom” in labour costs and taxation that had caused a public backlash, he said the EU should set minimum and maximum rates for corporation tax on a harmonised base. Ireland and the UK have long opposed this and favoured tax competition. Any country that did not apply the minimum rate should be excluded from receiving EU structural funds for economic development in the next long-term budget after 2020. To combat “social dumping”, posted workers from other EU states should have to pay social security charges at the rate of their host country, but the proceeds would revert to their home country. That would remove a key cost incentive to employ posted workers from cheap-labour eastern countries.

European defence

Macron proposed creating a multinational European intervention force to fight terrorism, with a common defence budget and a common military doctrine by the start of the next decade, saying Europe needed its autonomous military capabilities complementary with NATO in the light of what he called the “gradual and inevitable disengagement of the United States”. He also called for a European academy to train intelligence agents and promote cooperation among EU countries’ security services.

Trade protection

In the most Gallic part of his speech, Macron called for a carbon tax on imports into the EU to level the playing field between high European environmental standards and lower standards in producer countries. He also called for the creating of a European trade prosecutor to investigate whether third countries respected the principle of reciprocity in agreements with the EU.

Don’t mention Brexit

Macron said he had deliberately not mentioned Brexit in his ambitious speech but he hoped that the UK would eventually “find its place” in a multispeed Europe in a few years’ time. He made clear he expected that place to be outside the current EU, proposing that Britain’s 73 seats in the European Parliament should be used in 2019 to elect transnational European lists of candidates, rather than redistributing them among the 27 remaining member states.

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Edited by Hugo Dixon

One Response to “What Macron’s speech means for Brexit”

  • So long, its been good to know you (sung to a tune). While May and her clowns have been bickering amongst themselves the EU have consolidated their position and will regretfully bid us adeau. Not only May, of course. Corbyn and his mates have chosen the path of looking for some customised relationship that, it is clear, will be unacceptable to Brussels.

    It will be difficult for the EU in some ways but at least now they are rid of one of the most (if not the most) obstructionist countries in the membership.

    Don’t forget that while Cameron was promising action on tax avoidance to the home audience he was blocking reform in Brussels. Also remember how he blocked restricting cheap Chinese steel even while our own industries were suffering. The UK also provided a gateway to the EU for cheap Chinese imports that was so blatantly against the rules we were warned repeatedly and eventually fined a significant amount for this practice.

    We allowed constant unfair criticism of the EU to appear in our media for decades without much effort to offer a balanced view. We allowed Farage and his team the freedom to seek and destroy from within in Brussels.

    Yes, they will be glad to see the back of us.