How others see it

MOST of the Brexit debate has been about its effect on Britain. But a British departure would also have a profound impact on the European Union. And that would affect how others approach negotiations with a post-Brexit Britain.

For the EU, a vote for Brexit on June 23rd could hardly come at a worse time. The club is in trouble. The euro crisis is not over, with growth slow, youth unemployment high and Greece again in difficulties. The recent fall in the flows of refugees across the Mediterranean may prove temporary. Many leaders, including Germany’s Angela Merkel, seem politically weakened.

The longer-term effects of Brexit would also be serious. The EU would lose much prestige from the exit of one of its biggest members. Britain is one of the few EU countries with real diplomatic and military clout. Brexit would also upset the balance of power, leaving more naked both German hegemony and French weakness. And it would make the EU less outward-looking. As the Centre for European Reform, a London-based think-tank, notes in a new report, a British departure would leave the EU “less liberal, more suspicious of science and more protectionist”. That could hurt hopes of new trade deals, notably with America. Jan Techau of Carnegie Europe, a think-tank in Brussels, says Brexit would be bad for transatlantic relations, in which Britain is a key intermediary.

All this means other EU countries will see Brexit as a hostile act meriting a firm response. Diplomats avoid crude talk of punishment, but they also see a need to avert any risk that Brexit could encourage others to leave. Euroscepticism has grown in most countries and so have populist parties, many of which openly back Brexit. Marine Le Pen, leader of France’s National Front, even plans to campaign for it in Britain.

The new deal that David Cameron won in February may have been dismissed at home as trivial (and it barely features in the referendum campaign). But in Brussels many saw it as giving in to a blackmailer threatening to walk out. Michael Emerson, a former Eurocrat now at the Centre for European Policy Studies, another Brussels think-tank, also stresses Europeans’ aversion to Britain’s cherry-picking the bits of the EU to which it deigns to belong.

To most Brussels hands, that means there can be no question of giving a post-Brexit Britain full access to the EU’s single market while letting it escape the EU’s rules and the free movement of people. As one diplomat puts it, the other countries simply have to show that Brexit doesn’t work.

Brexiteers retort that, since the EU sells more to Britain than the other way round, it has a huge interest in a free-trade deal. German carmakers, it is said, would insist on one. Yet the bargaining clout of the EU is far stronger. For Britain, exports to the EU make up 12.6% of GDP, whereas for the EU, exports to Britain are only 3.1%. And for many countries, all of which would have to ratify a new trade deal, the ratio is smaller still (see chart). Take Romania: its exports to Britain are worth only 1.5% of GDP, and it may also be asked to accept curbs on migration if Britain leaves. Romania is threatening to veto an EU-Canada trade deal because of Canadian visa restrictions.

A final consideration for the EU is the need to show, post-Brexit, that the European project can still go forward. An obvious way to do this would be to relaunch the euro zone’s movement towards closer integration. In Brussels many predict a new Franco-German initiative after June 23rd, whichever way the vote goes. It may not get far as there is little agreement on what deeper union should entail. But it could still discomfort Mr Cameron, who likes to claim that the high-water mark of European integration has passed.

A Brexit vote would also come at a testing political time for Europe. Elections loom almost everywhere: in Spain three days after the referendum, in France, Germany and probably Italy next year. And in a final irony, Britain is due to take the rotating EU presidency in the second half of 2017—just when post-Brexit negotiations could be at their most intense.