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One year after the Brexit vote, Britain's relationship with the E.U. is unlikely to change much. Here's why. - Washington Post

Decades ago, political scientists Robert Keohane and Joseph Nye identified "asymmetrical interdependence" as the basic source of influence in international economic negotiations. When a buyer and seller bargain over the price of a house or a car, the person who needs the deal more is at a structural disadvantage. In world politics, power similarly stems from interdependence: The more dependent a country is on external flows of trade and investment, the more concessions it will make to secure a liberalizing agreement. That is why small countries, for which trade constitutes a critical lifeline, usually have less clout.

Britain is unlikely to extract many concessions from a far larger Europe on which it is asymmetrically dependent. Almost 50 percent of British exports go to Europe: They total 13 percent of British GDP, while European exports to Britain total only 4 percent of European GDP. If no agreement is reached, Britain has at least four times more to lose.

Britain will have to prioritize what it cares most about, such as future migration; it is likely to expend its limited bargaining power to achieve those goals. Yet, generally, if anyone is to make concessions to preserve the basic relationship, it is more likely to be Britain than Brussels. And that means retaining current policies.

To enhance British bargaining power, some Tories suggest rapidly signing trade agreements with non-European countries. Yet such trade agreements generally take a decade or more to negotiate and implement, and Britain is so small that it is unlikely to wield more influence on the United States or China than on the European Union.

by Bjinse on Mon Jun 26th, 2017 at 09:09:18 PM EST
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