Common Market Progress CAN BRITAIN YET “CATCH THE BUS”?

Press, Volume XCIX, Issue 29192, 30 April 1960, Page 12

Common Market Progress CAN BRITAIN YET “CATCH THE BUS”?

[By

"LYNCEUS”

of ths "Economist”)

(From the "Economist" Intelligence Unit)

London, April 20.—The Common Market has got into its stride with a speed and confidence which has astonished many people in Europe and outside it. An impressive compliment to it is paid in the Economic Survey of Europe which has recently been published by the Economic Commission for Europe, an agency of the United Nations, in Geneva. This points out that of the expansion in trade between European countries last year, no less than 60 per cent, was secured by the trade within the Six countries of the Common Market. The Geneva experts go on to empha'sise that some of this expansion in trade within the Common Mariket was achieved at the expense of European countries outside the Six. This is a portent of what may be in store when the Common Market gets into high gear, as it will in the next few years. The expansion of trade between the Common Market countries can hardly be attributed to the tariff concessions which they granted to one another in 1959. The element of preference which began to emerge at the beginning of the year with the first cut in Common Market tariffs, was almost negligible because most of the countries concerned agreed to e-tend to others' the tariff and quota favours they were granting to one another. Far more effective as a stimulus within the Common Market has been the new sense of unity 'between its member countries and the assurance with which they are now striding towards the objectives of free trade among themselves. These have created a sense of confidence on which many plans have been laid for expanding trade; without waiting for the advantages of tariff discrimination. Already alliances between individual firms in the Common Market are proliferating and the reality of economic unity is being achieved long before the outward trappings of that unity have been fashioned. Accelerated Timetable?

It is this success that has led Professor Hallstein, the President of the Common Market Commission, to table his proposals for an acceleration of the Common Market timetable. He has done so Son the good argument that one [should strike while the iron is [hot. The best time at which to lower tariffs is when trade is booming. There may also be political reasons behind the Hallstein plan. He wishes to consolidate the Common Market while the diplomatic going is good. He has good reason to know that the powerful influence of Dr. Adenauer has been a solvent of many of the difficulties that would otherwise have hampered the development of the Common Market, and that Dr. Adenauer's term of office cannot be indefinitely prolonged.

This acceleration of the Common Market plans is causing increasing concern in the United Kingdom. The impression is growing in all quarters of informed public opinion, and not least in business and industry, that Britain has “missed the bus" in the movement of European integration. This feeling of disappointment is heightened by the growing reali-[ sation of the mistakes that werei made after the end of the war,! at a time when Britain had a great opportunity not merely of catching the bus but of being its driver. Britain’s stand in the war. attested again by President de Gaulle in the visit to London, to which he referred as a “pilgrimage of homage," was the basis on which all the plans for uniting Europe had been made. Britain's leadership of the movement was there foi the asking. The opportunity was not taken. Britain's Three Ties The reasons for not taking it have on many occasions been defined in the parable of the three concentric circles, representing Britain's links with the Common- [ wealth, with the North Atlantic [Community, and with Europe. By identifying itself too closely with Europe, so the argument ran. the other loyalties might be endangered. The Commonwealth circle is undoubtedly there; and its importance is testified by the fact that no less than half of British exports go to Commonwealth countries. It is, however, becoming less and less exclusive in commercial terms. The value of Imperial preferences is dwindling steadily, as preferential margins are narrowing. The course of wisdom should surely have been to use these preferences as a bargaining counter while they still had some value. The problem of fitting the Commonwealth into a European economic community would have provided no insuperable obstacles, as was shown by the success with which the overseas territories of the Six countries in EEC. have been linked to the Common Market.

The argument emphasising the danger of weakening the ties with

the North Atlantic countries now acquires an ironic tinge. In all the discussions about the division of Europe into separate economic groups, the attitude of the United States has been steadily favourable to the Six of the Common Market rather than to the Seven of the Free Trade Association. The reason for this preference has been the political character of the Common Market. In other words, precisely that aspect of the Community which caused Britain to hesitate because it might endanger its ties with its friends across the Atlantic. The fact that mistakes have been made does not. however, excuse further inaction. An agenda for such action has recently been laid down by Mr W. H. McFadzean. the President of the Federation of British Industries, in which he made three points. The first was that Britain should put the Free Trade Association into effective operation as quickly as possible; the second, that it should maintain its trade with the Six; the third was that it should as soon as possible try to forge a link between the Seven and the Six, and “work unceasingly for a united and not a divided Europe.” To attain such a United Europe Britain will have to make concessions to her neighbours. The sooner this fact ia faced the better.