Friday, December 09, 2011

NAFTA is the way?

Reading these commentaries, it is clear that what Niall Fergusson and his friends on Wall Street Journal and other Blue House Clubs along two sides of Atlantic wished is coming true - UK is on way to get booted out of EU.

For once one has to agree with French President Sarkozy - you cannot keep on opting out of a deal and still continue to insist on having a say on that deal. Besides UK never had a strong case for objecting Continental nations  about how Euro business to be conducted when it continues to keep it's own Pound. 

UK's decision of staying out of Euro and sticking with Pound has been a great call. It just has to continue to build upon that. Going forward, Frankfurt will be the city of Finance as far as Europe goes. City of London for sure will suffer from that loss as well as UK economy from potentially market loss to Continental Europe if the divorce of UK-EU is complete. Such a separation may be inevitable as Germany tries to reuse EU institutions (wisely, instead of adding new institutions to already crowded place) making UK's involvement more and more problematic in any of these EU institutions. 

As Asian, Arabian & Turkey Market develop dramatically and trains start reaching to Berlin from Beijing; Germany will continue to pull Continental Europe more and more towards Middle Earth - China and land locked countries of Asia. That makes sense for Germany, for Europe and globally too. Given that, bridging over Atlantic to join brethren of Canada, USA and Mexico may not be 'bridge too far'. What is not to like there? Most speak English and each one of these countries continue to print their own currency. If Obama overtures across Pacific for a FTP with Asian (san China) countries succeed; even more access to Market.

These Europeans (especially UK) have been living for centuries practically for one single thing - access to Market. If your Left Side (Continental Europe) is squeezing you, move to Right (towards North America); that should be the operating model when UK faces the world. Why bother  endless rounds of negotiations and labyrinth of hulking Continental Europe, especially when it is not clear how all these deals would solve the European Crisis? May be joining NAFTA is the way for UK. 

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