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Analysis

Commentary

A vote for European balance

by Thanos Papasavvas | Tue 31 May 2016

The UK is likely to stay in the European Union after the 23 June vote. So I have been backing a contrarian positive outlook for sterling since its lows in March, when disquiet about a British exit was at its height. Europe's fragile economic and political equilibrium has been overly dependent on a balancing act performed by one person, German Chancellor Angela Merkel. A British exit, or indeed Merkel's own departure if she went precipitously, would cause Germany and Europe to face complex realpolitik challenges of the kind that confronted Otto von Bismarck, Germany’s legendary chancellor in the 1870s and 1880s. The best outcome for European stability would lie in the UK remaining inside the EU.

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Europe’s hopes and failures

by Ray Kinsella in Dublin | Mon 30 May 2016

A little exaggeration can season an argument. But it serves no purpose to present one side of the argument using such terminology as ‘quitter Brits’ who resent losing sovereignty to ‘unelected eurocrats’. In fact, member countries have begun to rein back sovereignty in areas such as the Schengen agreement. This underlines the extent of Europe's political failures and divisions. Respect for these different perspectives, as well as the historic nature of the decision, requires more reflective consideration and a different kind of language.

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Responding to incentives

by John Mills in London | Sun 29 May 2016

Much of the referendum debate has been on the economic consequences of Brexit. But if the economy turns down following the vote, Brexit is likely to have been a minor influence compared with other factors such as adverse global economic trends and huge imbalances in the UK economy. How well Britain does is more likely to depend in the short term on the policies the UK pursues in respect of maintaining open borders for trade, and on monetary, fiscal and exchange rate policies to help rebalance the economy.

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Temer is just the start

by Eduardo Borensztein | Fri 27 May 2016

Brazil's new administration faces daunting challenges. Interim President Michel Temer has assumed power with conditional support in Congress and little popular support. His term is uncertain. An ambitious economic reform programme might be regarded as impossible under such conditions. But the opposite is true. Only by launching a vigorous reform initiative can the government afford to adopt a looser short-term macroeconomic stance, generate positive economic expectations and stabilise the economy.

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Europe’s confederal future

by Pierre Haas in Paris | Fri 27 May 2016

The impact of a British departure from the European Union would spread well beyond the British Isles. The 23 June referendum recognises the dangerous separation of the populations of Europe from their political leaders. To overcome this gulf, and ensure the EU’s survival, member states should formally abandon the impossible goal of a federal Europe and propose instead a confederation of resilient nation states.

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Treasury adopts Newton’s theory

by Brian Reading in London | Thu 26 May 2016

The UK Treasury has produced a report saying a vote to leave the EU would produce ‘an immediate and profound economic shock creating instability and uncertainty’. Having looked at the methodology, I could hardly stop myself laughing. It is as bad as or worse than using Newton’s gravity theory as an instrument of economic forecasting. Undoubtedly the referendum adds to uncertainty. But I find the Treasury’s conclusions of a causal link between heightened uncertainty and lower growth deeply flawed.

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Stay or leave: a sovereign choice

by Kingsley Chiedu Moghalu in Boston | Thu 26 May 2016

At the heart of the debate about Britain's EU membership lies an argument over the meaning of sovereignty and democratic legitimacy. Everything else is sophistry. If there is one lesson developing countries and emerging markets should learn from the crisis of the EU, it is that they must be extremely cautious in approaching experiments in multinational integration. We see in Britain the contradictions between national sovereignty and cross-border integration: in essence, the limits of globalisation.

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Trade and the Brexit fallacy

by Sanford Henry in London | Wed 25 May 2016

Brexiteers speak with the conviction of life-long obsession. If the UK leaves the EU, they are making cast-iron guarantees to the British people and the country's trading partners. They laud the prospect of an avalanche of worldwide free trade deals. With these fast-growing economies, so the argument goes, the UK will be free to forge its own commercial accords and loosen its dependence on dreary, sclerotic Europe – a Europe that absorbs close to half of all British exports. Peddlers of this utopian dream need a reality check.

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Britain’s risks are in staying, not leaving

by David Owen in London | Tue 24 May 2016

David Cameron, the British prime minister, has unambiguously shown the futility of attempts to gain significant EU reforms. That’s why I shall be voting No on 23 June. Departing would bring many positive changes. For British security in its deepest sense – economic, political, military and social – remaining in dysfunctional EU, dragged down by a failing euro, is, I believe, a dangerous option. Remaining in the EU is more risky more than leaving.

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Swish Six go to Europe

by David Marsh in London | Tue 24 May 2016

Six besuited men stride across the lawn, sober, slightly sheepish. They are greeted with expansive bonhomie by another male, open-neck-shirted, rosy-cheeked. David Cameron, the prime minister, begins: 'Welcome, gentlemen, the people have spoken – a 60-40 majority for staying in the EU. Our six living former chancellors of the exchequer all gathered here, quite an occasion. I want you to bury your differences. Help me launch genuine European reform…'

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