Orchestrating Europe (Text Only). Keith Middlemas

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СКАЧАТЬ explicitly federal implications of the EEC made it superficially unattractive for the rest of Europe.² A variety of political, economic or security reasons confined the supranational course initially to a limited group of countries, albeit a group that comprised more than half of western Europe’s output and foreign trade. Nonetheless the outsiders still constituted a sizeable market of considerable sophistication, one that had shared with the Six the same pan-European movement towards commercial liberalization and growing interdependence. Among these smaller trading economies, in particular Denmark, Sweden and Switzerland, there existed the same drive towards a further relaxation of protectionism that had motivated the Benelux countries, and this drive was reinforced by the fear of what might happen once the mutual preferences, implied by the formation of the customs union by the Six, began to take effect. The government of the United Kingdom was particularly concerned about the possibility of an economic division of Europe and, at the end of 1956, tried to neutralize the effect of EEC preferences with a proposal for a wider industrial free trade area to be constructed inside the OEEC.

      The initiative was launched at a particularly testing moment for the Six, since the common market negotiations had still to be concluded and then ratified by national parliaments. The Commission of the EC itself did not begin work until January 1958. If the free trade area offered non-member states a solution to their dilemmas, for the Six it posed a distinct threat. Distrust of British motives suffused the following negotiations but there were more prosaic reasons why the Six were reluctant to embrace the UK initiative. For example, the French, in the final stages of the common market negotiations, obtained a set of favourable conditions and safeguards that they could not replicate in the free trade area. Moreover, the French, Italians and the Dutch had obtained some ‘compensation’ for the opening of their industrial markets through the prospect of a common agricultural policy, but agriculture was exempted from the British plan. Finally, those who hoped that the Community institutions would rapidly develop in a federalist direction were worried that their energies might be dissipated by the Free Trade Area.

      The Free Trade Area negotiations dragged on for nearly two years, before finally being terminated by the French in November 1958. Under de Gaulle, France had decided to embrace the Treaty of Rome without recourse to its opt-out provisions. This commitment was worth infinitely more to Adenauer than the dubious prospect of a free trade area and thus the move received German acquiesence, if not support. The Commission, especially under its first president Walter Hallstein, had never liked the British plan and was generally pleased to see the back of it. Indeed by the end of the year, among the Six, only the Dutch government and the German economics minister, Ludwig Erhardt, could be numbered amongst its supporters. In the face of the opposing coalition there was little they could do.³

      The failure of the free trade area negotiations left the UK without any coherent strategy towards the Common Market. In the absence of an alternative, the idea of forming a smaller free trade area amongst the ‘outer Seven’ (Britain, Denmark, Norway, Sweden, Switzerland, Austria and Portugal) rapidly took over. With the exception of Austria and Portugal, these were already relatively low tariff countries which shared a desire to maintain tariff autonomy towards third countries. They therefore preferred the concept of a free trade area to solve Europe’s trading problems, rather than the more restrictive principle of a customs union. Formal negotiations started in June 1959 and culminated, in January 1960, in the Stockholm Convention establishing the European Free Trade Association (EFTA).⁴

      EFTA’s ambitions and its structures were simpler from the start than those adopted by the EEC. It was essentially designed to ‘build a bridge’ to the EEC, thereby obtaining through bilateral negotiations en bloc what the previous multilateral negotiations had failed to deliver. The differences can be summarized as follows:

      * The EEC wanted a customs union, EFTA did not.

      * The EEC had to build a common external tariff, EFTA did not, but did require instead a ‘certificates of origin’ regime. The common external tariff meant that the EEC needed a common commercial policy, whereas EFTA did not.

      * The EEC wanted to eliminate the cause of trade distortions at source and required the machinery to do so; EFTA instituted a procedure to deal with complaints if and when different national practices were felt to have distorted trade.

      * The EEC wanted a common agricultural policy; EFTA excluded agriculture but relied instead on bilateral agreements to expand agrarian trade.

      In a way, EFTA was almost designed to disappear in the form in which it had been cast. It was only the subsequent failure of the ‘bridge-building’ strategy that forced it to assume the identity of an individual trading organization in its own right.⁵

      Even before the establishment of EFTA, the Macmillan government had begun to consider applying for full membership of the European Community. By late 1959, it had become increasingly apparent that the UK would be unable to negotiate a settlement which aimed at a parallel removal of barriers within the EEC and EFTA and between the two blocs. The ‘Hallstein Report’ of 1959 which outlined the EEC’s foreign policy perspectives left little room for a purely commercial settlement in Europe. Moreover, the United States, faced with a mounting balance of payments problem, made clear that it would not accept the discrimination implied by an interim settlement unless it conformed with GATT rules. That meant that any solution ended in a forseeable time and according to a fixed schedule, with the complete abolition of trade barriers. At the time the most that was on offer was a Benelux plan for the mutual exchange of the next scheduled tariff cut.⁶

      Throughout 1960, the number of voices from the press, business circles, and certain politicians calling for a reappraisal of the UK’s relations with the Six, grew considerably. However, the strongest statement seeking a drastic change in course came in May 1960, from an interdepartmental committee headed by Sir Frank Lee. It advanced the view that Britain should abandon attempts to negotiate loose economic agreements with the Six and instead seek full membership of the EEC. The Committee’s arguments, based more on political than economic considerations, can be summarized as follows:

      * The offer of a purely commercial ‘bridge’ between the EEC and EFTA would never be acceptable to the Six.

      * The UK would face a relative decline in its political significance if it remained outside the EEC.

      * The danger of a European federation would be mitigated if the UK joined while de Gaulle, who was notoriously anti-federalist, was still in power in France.

      * Special arrangements for UK problems, such as Commonwealth trade and domestic agriculture, could be negotiated.

      Macmillan was anyway predisposed to accept these arguments. Although he had been its victim, he had been impressed by the power and influence of France and Germany within the EEC. He saw in it the reinforcement of traditional great power diplomacy within which Britain could easily function, somewhat missing the point that the attraction of these arrangements to both Adenauer and de Gaulle was their exclusivity. Yet it was more than a year later before a formal application was made. This was primarily because of the daunting array of individuals and organizations which had to be persuaded of the desirability of EEC membership (from the party to the parliament, the press and public, not to mention the Commonwealth and EFTA). Macmillan also faced the ‘presentational difficulty of explaining why a policy which had been repudiated inflexibly since 1948 had now become both desirable and necessary’.⁷

      In July 1960, Macmillan appointed Edward Heath as lord privy seal, with special responsibilities for Europe. His major task in the ensuing year was to appraise the attitude of the Six, and France in particular, to the prospect of British entry. There would be little point in even considering a membership application if the French remained determined to keep Britain out. However, by summer 1961, it was evident that the French would not discuss possible concessions to UK interests prior to a СКАЧАТЬ