Iain Macwhirter: Scotland could rejoin the EU, but would it want to?

Well, let’s get Project Fear out of the way first. There is every reason to believe that an independent Scotland would be fast-tracked back into the European Union. Talk of Scotland being held indefinitely in a holding pen with Turkey, North Macedonia and Albania is ridiculous. These are countries with awkward human rights and unresolved economic issues.

Scotland is a stable democracy, with an impeccable human rights record, a dynamic and flexible economy and prodigious natural resources. No, we don’t have a high-value economy any more, like Ireland’s or Norway’s, largely because of being a backwater in the UK for the last half century. But Scotland could still offer the national income of Portugal with the population of Slovakia.

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So, we can forget the 2014 nonsense about going to the end of the queue or being blocked by Spain. There is now a reservoir of goodwill, especially in the European Parliament, following Scotland’s determined resistance to Brexit. We’d be back in, probably within 4-5 years according to Kirsty Hughes of the Scottish Centre on European Relations.

However, there is one small problem. Scotland would have to be fully independent first. Unless Scotland has a referendum in this transition year there is no longer any prospect of Scotland, as it were, remaining in the European Union as rUK leaves. We may still be under the same regulatory environment as Europe in the transition period, but don’t think that can just be extended as in Northern Ireland.

Mentioning the Irish backstop is not the way to get a sympathetic hearing in the European Union. Many states are unhappy about Northern Ireland being allowed to remain, effectively, in the European single market without being part of the EU or the EEA.

It breaks all the rules. And Scotland can forget about being given similar treatment. Speaking to Brussels officials this week confirms that there will be no read-across to Scotland from the Northern Ireland protocol. They won’t even discuss it.

So, there is no half way house. Scotland needs to take the leap into full independence. That means having a central bank and an autonomous currency before Scotland could become a candidate for accession. There are two problems here, but they aren’t insurmountable.

Scotland would have to formally agree to the Maastricht Treaty, and membership of the euro. It is most unlikely that Scotland would get a formal opt-out from the euro, but it could drag its feet for a very long time, like Sweden. Whether Scotland would want to is another matter. Euro membership has worked well for many small countries.

A more difficult issue is convergence. Scotland would have to show that its economy meets the terms of the stability pact, which means having a deficit of less than three per cent. At present, according to the GERS figures, Scotland has a deficit of more than twice that.

However, after independence these numbers would almost certainly change. There will be a lot of fiscal give and take between Scotland and the rest of the UK over assets and liabilities.

But Scotland would have to show that it is capable of harnessing its currency to the euro, even if it doesn’t actually join it. Currency autonomy might be hard to establish if, as in the Scottish Government’s scenario, Scotland keeps using the pound for a decade after independence.

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If a nominally independent Scotland were still subject to interest rates operating in a country that is outside the European Union, that would be a difficult sell. The EU is very good at finding novel ways to get round problems like this. But it might take a few years.

There may be a trade deal on regulations between the UK and the EU that solves some of Scotland’s accession and border problems. We just don’t know. This is one of the imponderables of Scottish independence. It is actually very difficult to make a clear prospectus for indyref2 when we don’t yet know how the UK is going to stand in relation to the EU.

But there is a bigger question than all of these: would Scotland necessarily want to rejoin the European Union? Nicola Sturgeon takes it as read, but there would be a debate at the very least. Around a million Scots voted for Brexit and many of them were supporters of independence.

Brussels has had some bad press in the last decade. Austerity policies were imposed after 2010 which were worse than in the UK and caused problems across the Mediterranean states. Its behaviour toward Greece during the sovereign debt crisis would have shamed the British Empire at its worst.

Brussels stood idly by while one member state, Spain, imposed draconian repression in Catalonia, breaking heads and locking up elected politicians. There was scarcely a word from Brussels, let alone sanctions. Then there is fish.

Many in the independence movement believe the EU is a neoliberal club – which it is – and would be happier with an arrangement like Norway’s which has control of fishing grounds, is not subject to EU rules and has a managed economy. The case for a referendum before Scotland rejoined the EU would seem to me to be unanswerable.

At the very least, the SNP could not take it for granted. Unionists will continue to argue that it makes little economic sense for Scotland to leave the Union with the UK, which is where the majority of Scottish exports go. There would be a hard border, currency controls, possibly tariffs.

Ms Sturgeon’s problem is that the very arguments the SNP used against leaving the European Union – freedom of movement, zero tariffs, regulatory harmony – apply equally to leaving the United Kingdom. They’ll come winging back. Aversion to Boris Johnson may not be enough to persuade Scots to take the biggest leap in 300 years.

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