Trade

Norways Brexit rethink

OSLO — The British government rejected a Norway-style deal with the EU as not good enough for the U.K. — now some powerful voices in Norway are saying the same may be true for their country.

Brexit is putting Norways 25-year-old cooperation deal with the EU under pressure. A junior party in government is suggesting reform, while union groups are becoming increasingly critical, and the opposition Center Party, which wants to rip up the deal, is surging in opinion polls.

Initially, Britains impending EU departure threw the spotlight on countries with vocal Euroskeptic movements such as the Netherlands, Italy and even France. The concern in Brussels was that if the U.K. got too favorable a deal, it could encourage others to leave.

But while the obvious power imbalance in the Brexit negotiations and the resulting political chaos in London has led anti-EU parties to tone down talk of leaving the club, Brexit has raised new questions for those on the EUs periphery. Norway, for one, is watching closely the deal that the U.K. ends up taking.

“Maybe Brexit can open some doors which were locked before,” said Sigbjørn Gjelsvik, a Center Party lawmaker and spokesperson on EU relations.

Voters in Norway rejected the chance to join the EU in 1994.

“Opponents of the EEA see Brexit as an opportunity to renew discussion over Norways relationship to the EU,” said Jon Hovi, a political scientist at the University of Oslo. “The [European Economic Area] is facing opponents from different parts of the political spectrum.”

Unlike its Scandinavian neighbors, Norway is not a member of the EU. Voters there rejected the chance to join in 1994 after concerns grew about a loss of control over valuable fishing areas.

Instead, along with Switzerland, Iceland and Liechtenstein, it remains a member of the European Free Trade Association, EFTA, an intergovernmental organization set up to promote trade and economic integration between members, but which is looser than the EU.

Norway, Iceland and Liechtenstein are also members of the European Economic Area, which unites them with the 28 EU members in the internal market. It commits them to adopting many EU rules, but gives them no say over policy.

(From L) Norways Prime Minister Erna Solberg, Prime Minister of the Principality of Liechtenstein Adrian Hasler, Prime Minister of Iceland Katrín Jakobsdottir and European Council President Donald Tusk attend a press conference to mark the 25th anniversary of the European Economic Area on March 22, 2019 in Brussels | Ludovic Marin/AFP via Getty Images

The U.K.s departure from the EU is leading some in Norway to question the countrys own deal with the bloc. As the complexity of leaving the EU has become clearer, some in the U.K. have called for what has been called “Norway Plus.” This would be a Norway-style EEA agreement, but with the addition of a customs union with the EU (which Norway does not have) in order to avoid a hard border on the island of Ireland.

Opponents to the idea, seemingly in the majority, say such a deal would be the worst of both worlds as it would mean accepting freedom of movement into the U.K. — which the government opposes and many Brexit voters despise — as well as continuing to pay into the EUs coffers, and getting no say over the direction of travel.

Gjelsvik, whose Center Party surged to third place and 14 percent support in a recent opinion poll, said similar concerns are bubbling up in Norway.

“We have a growing debate about the consequences of the EEA agreement: the free labor market, what will happen with wages and the welfare system and national sovereignty.”

One of the major groups within Norways largest private sector trade union came out against the EEA agreement recently, saying it should be terminated. In particular, it disagreed with a European ruling about compensation for workers who are posted away from their home countries to work.

Norways senior governing party, the Conservatives, and the main opposition party, Labor, remain supporters of the EEA agreement.

Meanwhile, concerns over immigration levels have prompted a junior government party, the Progress Party, to call for change.

“We want to renegotiate the EEA agreement to remove the major drawbacks of free labor immigration, especially from Eastern Europe,” deputy leader Sylvi Listhaug told the Norwegian paper VG.

Meanwhile, Norways senior governing party, the Conservatives, and the main opposition party, Labor, remain supporters of the EEA agreement, meaning change is unlikely in the near term, analysts said.

However, if the dissatisfaction within the union movement continues to grow, that could pressure the Labor Party, with which it has close ties, to change tack.

Conservative Prime Minister Erna Solberg recently praised the EEA in a speech at a meeting of the employers group the Confederation of Norwegian Enterprise, calling it the “worlds best trade deal,” which has helped create jobs and keep prices low.

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