The Pros and Cons of Joining EFTA vs. Staying in the EU After Brexit

Brexit, a significant event in 2020, caused considerable disruption to the British economy and its relationship with Europe. One of the major questions that arose was whether the U.K. should join the European Free Trade Association (EFTA) or remain in the European Union (EU). This article explores the differences between EFTA and the EU, especially after the U.K.’s decision to leave the EU, and why opting for EFTA might not be the best choice.

The European Free Trade Association (EFTA) and the European Union (EU)

Before delving into the specifics, it’s important to establish the differences between EFTA and EU. EFTA is a group of European countries that are not EU members but have free trade agreements with the Union. It currently comprises four countries: Norway, Iceland, Liechtenstein, and Switzerland. The EU, on the other hand, is a larger and more integrated bloc of 27 countries, with a common market and a range of policies that affect all member states.

EFTA: The 'Worst of Both Worlds'

EFTA is often described as the 'worst of both worlds.' Members of EFTA are required to accept EU regulations, which means they have to comply with common domestic laws. However, they have no say in the decision-making process regarding these regulations. This lack of control and representation within the EU can be seen as a significant drawback. Additionally, while EFTA offers some access to the European Single Market, it comes with higher costs. The fees for EFTA countries are around 25-30% lower than those for EU countries, but this is still a considerable expense. Furthermore, EFTA does not afford its members the luxury of strong negotiating power, as they cannot stand up to the EU and assert their interests.

UK’s Decision to Join the EU: A Case of Blind Trust?

The UK’s decision to join the EU, based on what former Prime Minister Edward Heath claimed, is a topic of much discussion. The reality is that the decision was made under false pretenses. The Treaty of Rome and the founding documents of the EU clearly stated the aim of 'a more closely union' rather than focusing on trade. Critics have pointed out that Heath’s promises were based on a false narrative to gain support for the UK's entry into the EU. Political integrity does not seem to have played a significant role in Edward Heath's decision-making process.

Why EFTA is Not the Ideal Solution

EFTA is not the perfect solution for the U.K. or any other country that wishes to engage with the EU. The core principle of free trade is based on import controls, which EFTA countries largely lack. By being outside such agreements and structures, countries can control the cost of imports, which is a crucial factor in maintaining economic stability. EFTA leaves its member states in a position where they can only focus on imports and not effectively negotiate or control the terms of trade.

The European Economic Area (EEA)

The European Economic Area (EEA) is a broader concept that includes all EU member states and also Iceland, Liechtenstein, and Norway. This agreement allows these countries to participate in the EU’s single market. Switzerland, while not a member of the EEA, is part of the single market through bilateral agreements. However, this arrangement requires Swiss citizens to have equal rights as other EEA nationals to live and work in EU countries, highlighting the benefits of remaining within the EEA framework.

Conclusion: Choosing Wisely

After considering the differences between EFTA and the EU, it becomes clear that staying within the EU or the EEA offers a more favorable position for countries like the U.K. The flexibility and control over trade, as well as the access to the extensive single market, make the EU a more viable partner in the long term. EFTA, while offering some benefits, is ultimately a less ideal solution, especially given the reported false promises and the structure of free trade agreements.