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It may be hard to find allies outside the Union

The Times of London
Published at 12:01AM, September 9 2014

 

Vuk Jeremić

Scots must realize that a vote for independence will not be without repercussions for the rest of the UK and Europe

 

Next week the residents of Scotland will vote on whether to leave the UK after more than three centuries. Scotland’s natural and human resources, and sense of identity, surely constitute a viable foundation for it to stand alone on the global stage in the future. Yet the economic and diplomatic consequences of a yes-vote would be felt far beyond Britain’s border, significantly impacting on European and international engagements.

An independent Scotland would face a considerable challenge to repay its fair share of UK debt while outside of a sterling monetary union. At best, the UK would receive an IOU from Scotland. And if the burden proves too great, this becomes a problem for UK, with potentially EU-wide repercussions. If Scotland walks away from its share, as it has threatened, establishing good ties with international financial institutions would be fraught with difficulty. It would create a precedent for other secessionists in Europe and beyond to argue that part of their debt burden is illegitimate.

In addition, Edinburgh would have to apply de novo for membership in every multilateral organization to which Scotland currently belongs through the UK. In some cases, admission might appear to be relatively straightforward, such as with the United Nations and the Organization for Security and Co-operation in Europe. However, a real possibility of arising political complications must not be discounted, given currently volatile geo-strategic circumstances.

Scotland would enjoy none of the privileges that stem from the UK’s membership in NATO and the European Union. Statements from Atlantic Alliance and EU leaders, as well as from those of member countries—including the British and Spanish prime ministers—indicate that admission to these two organizations would be far from automatic, and Scottish exceptionalism would certainly not preclude demanding entry requirements.

In the case of NATO, a key prerequisite would be clarity on the status of British armed forces; naval, army and air bases; and nuclear weapons currently located in Scotland. The question of air space control, given Scotland’s strategic location, would need to be sorted out as well. These are not solely bilateral issues, as they represent critical parts of the Alliance’s strategic operational framework.

In the case of the EU, the secession of Scotland would negatively affect multi-ethnic democracies such as Belgium and especially Spain, which is deeply troubled by the possible boost a Scottish yes-vote could have to Catalan and Basque independence aspirations. It would be hard for a sovereign Scotland hoping to join the EU to easily gain the full support of EU capitals struggling to hold their respective states together, in part due to the precedent set by the aspirant itself.

Scottish independence would also increase the likelihood that the UK would leave the EU. An EU without the sixth-largest global economy and one of the world’s most skillful diplomacies would leave it significantly weaker in international circles.

A yes-vote could also trigger a debate about the future of the crucial veto-wielding permanent seat on the UN Security Council held by the UK. For several years, negotiations on Security Council reform have looked to expand the number of permanent members to better reflect contemporary global dynamics. Little progress has been made to date, but Scottish independence could empower increasingly influential stakeholders to press forward with greater verve.

A similar debate is likely to be reenergized about recalibrating the weighted system of voting in international financial institutions such as the World Bank and the IMF. It is not just that the UK’s voting share would need to be reduced, but that of other founders of the Bretton Woods system, including EU countries and the US, could be further called into question. It would be hard to argue that this could be advantageous for Edinburgh.

History has no precedent of a consensual separation of the financial sophistication of Scotland. A financial border would be created where existing ownership of cross border assets within the UK would become foreign assets and liabilities. The balance sheets of two of the world’s largest financial institutions based in Scotland would also be divided. If they relocate, as expected, this would add to the rest of the UK’s public finance risks.

Many of these important economic and diplomatic issues are unlikely to be resolved by the self-declared date of possible independence in March 2016. This would leave an independent Scotland outside of military alliances, political unions and most multilateral organizations for an unspecified period. For the first time in modern history, Edinburgh would be directly subject to the ebbs and flows of geo-strategic circumstances. Such important considerations need to be taken into account by those fated to determine the future of Scotland and the rest of the UK.

Mr Vuk Jeremic is the President of the Center for International Relations and Sustainable Development and a former President of the United Nations General Assembly and Serbian Foreign Minister.

 

THE TIMES

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