How will Brexit result affect France, Germany and the rest of Europe?

Britain’s decision to leave the EU changes the facts of life in Europe, increasing the challenges faced by the governments of France, Germany, the Netherlands and elsewhere in the continent — notably in the Nordic countries.

FT correspondents report on the new political landscape in the bloc now that Brexit is a reality, with repercussions likely to be felt far and wide.

France

The Leave vote will send shockwaves throughout France’s political mainstream parties, which fret about the probable boost it will give the resurgent far-right National Front party less than a year before presidential elections.

The anti-euro, anti-immigration party has consistently attracted the largest share of votes in the first round of local and European elections in the past two years. Its leader Marine Le Pen, who is expected to qualify for the second round of next year’s presidential election has already seized on the In-Out campaign to call for a similar referendum on French membership if she wins powers.

France has “a thousand more reasons to leave than the UK,” Ms Le Pen said on Tuesday in a televised interview.

She pointed out that, in contrast with Britain, the country is part of the eurozone and the Schengen passport free zone — two supranational innovations that have come under severe strain in recent years.

“Whatever the result, it shows the EU is decaying, that there are cracks everywhere,” Ms Le Pen said, describing Brussels as “totalitarian” and requesting to unwind it to go back to a “Europe of the nations”.

As such Eurosceptics gain prominence ahead of next year’s election, Nicolas Sarkozy, the former president who is eyeing a second run at the Elysee, has already intensified his own anti-Brussels rhetoric.

Fear of contagion at home and across the bloc is one of the big reasons why François Hollande, French president, has been adamant that there must be short-term consequences for the UK if it votes to leave, since the referendum result may tempt other countries to negotiate new terms with Brussels.

“Playing down, or minimising, the consequences would put Europe at risk,” a French diplomat said. “The principle of consequences is very important, to protect Europe.”

Germany

German officials are convinced that their country can withstand any financial shocks that may come in the next few weeks. They are also fairly confident that German business can manage the potential effects of Thursday’s vote on the complex trade relationship with the UK, Germany’s third-biggest export market.

But politics is a different story — for the EU and for Germany’s role within the union, Brexit could signal disruption for years to come.

Berlin worries particularly about anti-EU sentiment in the union’s western heartland, including France and the Netherlands. Decades of integration could be put into question.

EU officials are looking at responses aimed at rallying the remaining 27 member states and trying to revive some enthusiasm for the union. Security, foreign policy and border control have all been put under the microscope. Officials think these issues could — under the right circumstances — appeal to a public concerned about both jihadis and refugees.

But Berlin wonders who could lead such a push. German politicians ask whether Brussels is the suitable candidate to head such a campaign, given that many EU voters share Britons’ antipathy to the Euro bureaucracy. If not Brussels, member states must take the lead, and then Germany must play the central role, given its political weight.

There is a problem. Ms Merkel has tackled the four recent challenges — the global financial shock, the Greek rescue, the Ukraine conflict and the refugee crisis — by taking the lead and forcing others to follow.

This has generated intense opposition, for example in southern Europe over German-led austerity and Russian sanctions, and in eastern Europe over refugees.

Ms Merkel has shielded herself with allies. But with the UK leaving, the list of heavyweight partners shrinks. The EU is losing one of its big three states, a country with deep diplomatic and military experience, and a voice for market-oriented deals.

If Germany now starts giving orders even more than it does already, it will be more vulnerable to charges of hegemony.

But if the country stays quiet, for fear of appearing overmighty, it risks leaving a political vacuum for others to fill, notably nationalists in France and elsewhere.

The Netherlands

After Brexit comes “Nexit” according to Geert Wilders, the leader of the rightwing, anti-EU PVV party that tops the polls in the Netherlands.

“Hurrah for the Brits!”, Mr Wilders tweeted on Friday morning, in response to the UK vote. “Now it’s our turn. Time for a Dutch referendum!”

In the run-up to the vote, Mr Wilders toured newspapers and TV channels with a simple message: after the British have their say on the EU, the Dutch should have theirs.

Following the success of the Leave campaign in the UK, these calls will only grow louder, especially in the lead-up to a general election due by early next year. “A vote for the

[PVV] is a vote for a referendum on a Dutch Nexit,” said Mr Wilders this week.

The Dutch government already had a headache after a referendum this year rejected an EU trade deal with Ukraine; British voters have just given them a bigger one.

Nordic states

Denmark, Finland, Iceland, Norway and Sweden have long looked up to the UK for leadership on everything from the EU and trade matters to culture and football.

Surveys suggest that Sweden and Denmark will be among the countries most negatively affected by Brexit. As a result, such countries are likely to rush to reaffirm their place within the EU, as is Finland, their Nordic neighbour. “I imagine the prime minister will double down on support for the EU straightaway, not least to reduce the threat from populists,” says one senior Danish government official.

Populist parties such as the Danish People’s party and the Sweden Democrats are likely to try to exploit the Brexit vote for their own ends. Although polls show a strong majority in favour of the EU in Sweden and a smaller one in Denmark, politicians in both countries expect the public to wonder why Britain got a vote when they have not. “It really could be a Pandora’s box,” says one Finnish minister.

More difficult to read is the reaction of the two non-EU Nordic countries, Norway and Iceland. Norway’s government has strongly warned the UK not to follow it into the European Economic Area in which Oslo has access to the EU single market but has to pay large amounts and accept all EU immigrants.

But Norway and Iceland could in the case of a Brexit gain a new heavyweight member of the EEA. One Norwegian minister is amused by the prospect: “It’s odd enough when I, from a country of 5m people, have to go to negotiate with my colleague from Liechtenstein [the third member of the EEA]. Just think how it would be for Britain?”

 

Source: FT

 

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