The Scottish Referendum for independence
On the eve of the Scottish referendum, which, I have to confess, has driven me mad because of the childish behaviour exhibited by both sides, it seems right to explore what might go wrong if Scotland does take the brave step to go it alone – well almost alone because they are still insisting that they are intend to use the pound as currency.
EU membership – renegotiate or re-apply?
The biggest stumbling block must be Scotland’s EU membership. First Minister, Alex Salmond, continues in the belief that Scotland will be able to retain existing membership of the EU by negotiating ‘tweaks’ to current treaties to, in effect, step sideways and remain in the EU once independent. Scotland would also keep the pound and wouldn’t enter into the Schengen Agreement. It seems highly unlikely that the member countries are going to allow this, although the ‘Yes’ camp have justified their position by saying …
“There is no way that the EU won’t want to keep oil-rich, fishing-rich, renewable energy-rich Scotland. And we will keep the pound, because joining the euro is entirely voluntary – as the example of Sweden shows. We have no intention of joining the euro, and don’t even qualify for membership even if we did.”
In the last couple of days there has been much debate among high-level politicians in Europe about Scotland’s position and it should be remembered that EU membership must be unanimously agreed by the very politicians who are now voicing doubts about Mr. Salmond’s claims.
Íñigo Méndez de Vigo is a Spanish politician and is also Spain’s Minister for European Affairs. This week he said: “It is crystal clear that any partner [of a] member-state that leaves the member state is out of the European Union. If they want to apply again, they would have to follow the procedure of article 49 of the treaties” noting that there were “more ifs than a poem by Kipling” as to the possibility and the terms on which Scotland would gain entry. Because of the need for unanimity amongst the member states he concluded that “it is a process that takes more or less five years”.
Sterlingisation – will the new state really abandon its debt to keep the pound?
Salmond appears to be under the illusion that independence will mean that he can almost do as he pleases. This is evidenced by his warning that an independent Scotland, failing an agreement with the remainder of the UK about currency sharing, can simply keep using the pound and walk away from their share of the UK national debt.
The National Institute of Economic and Social Research (NIESR) said in a damning report that action of this kind would see Scotland isolated from EU and international markets and would bring about “unprecedented austerity”. It noted that such a serious default on debt would mean that rating agencies would mark down Scotland’s current ‘Triple-A’ rating relegating it to below investment grade. The end result of this would mean that the newly independent Scottish government would be unable to raise new funds for up to a decade, according to the NIESR.
Mr Salmond’s explanation that Scotland could not be forced to use the Euro because it would not meet the economic conditions seems not to hold water. Mr Mendez de Vigo said: “There is an aim of all member states to share a common currency.” Sweden joined the European Union in 1995 and its accession treaty was signed in 1994. In the EU following the Euro crisis, it is highly unlikely that Scotland will be allowed to follow Sweden’s example. It would have to work towards ERM II, and this in itself would cause enormous difficulties to the Scottish economy.
The Scot’s Schengen problem
Finally, what of the Schengen agreement? Gianni Pitella, president of the Progressive Alliance of Socialists and Democrats, warned the newly created state of Scotland wouldn’t enjoy the UK’s existing rights to the UK’s opt-outs when it negotiates to join the EU. He said: “An independent Scotland would have no automatic right to the various special treatments that the UK has been granted over the last few decades, from the budget rebate to having no obligation to join the euro or participate in the Schengen area of travel without frontier controls. No new member has been accorded such special treatment.”
From this statement it would seem clear that the Scottish state would have to sign up to Schengen and this could be a really serious matter for England and Wales as, should Scotland be in the Schengen Area, it could seriously weaken the ability of England and Wales to enforce current immigration. We could end up with a frontier barrier like the one erected along the land border between Morocco and Ceuta as the Calais migrant camp moves to Gretna Green!
Shetland’s oil for Shetland?
A further problem will be Islands such as the Shetlands. There has been more than a murmur of dissatisfaction from the leading voices of the 22,000 islanders, with many saying that the Shetlands should follow the Scottish mainland and claim its own independence following a successful ‘Yes’ campaign.
Shetland, with its vast oil reserves, may consider taking steps to become a self-governing territory, similar to the Isle of Man, in preference to remaining within an independent Scotland after a yes vote, the Scotland secretary, Alistair Carmichael, has said.
In an interview with the Guardian, Carmichael said if Shetland were to vote strongly against independence but the Scottish national vote was narrowly in favour, then a “conversation about Shetland’s position and the options that might be open to it” would begin.
Tactical errors of the ‘Yes’ Campaign
It seems sad that Mr. Salmond has set about the referendum without thin king much of this through more carefully. There is considerable concern in Scotland regarding Mr. Salmond’s integrity. Fiona Scott, whose father John Ferguson taught Mr Salmond mathematics at Linlithgow Academy, West Lothian wrote in a newspaper that “Mr Salmond has succeeded in creating divisions across Scotland that were not there before and that will still exist after the referendum, no matter which way the vote goes. Stories of intimidation, violence and vandalism are rife. Freedom of speech is under threat. Relationships between neighbours are now threatened if you indicate which way you are voting.”
Mr. Salmond has an uphill battle, whether he wins or loses the referendum that he was so keen to see take place.