The Swedish Plan
By CHRISTOPHER HOLLIS THE formation of the Common Market of the Six central countries of continental Europe, and the collapse of the negotiations for a Free Trade Area of all Western European countries, have left not only Britain but all the countries out- side the Six face to face with a very serious threat. All of them, if left in isolation to face the threat of exclusion from this very important market, will be in for a very hard time. There has been pretty general agreement, therefore, that some- thing must be done to restore the situation. Briefly, there are two alternatives—either to build some- thing bigger than the Common Market by creat- ing a great trading area on the lines of the so- called Strasbourg Plan, of which both the countries of Europe and the countries of the Commonwealth would be members, offering a market to the countries of Europe in the Com- monwealth and to the countries of the Common- wealth in Europe: or to build a counter-organisa- tion to the Six within Europe—a Free Trade Area of the countries' that are not members of the Common Market, that is to say, the three Scandi- navian countries, Britain, Switzerland, Austria and Portugal. It is this latter plan that is now being put forward by the Swedes, naturally not as sensitive as we are to the importance of the Commonwealth. The Swedes propose reductions of tariffs between the Scandinavian countries and Britain more rapid and leading more rapidly to complete free trade than those envisaged in the Common Market. In any event, and whether Britain joins in or not, it seems likely that the Scandinavian countries will before long create a customs union among themselves.
These proposals are still at a very tentative stage. Much about them is uncertain. It is not certain whether Denmark, with her exports of food both to Great Britain and to Germany, will on balance prefer to join such an area or prefer to join the Six. The latest statements of the Danish Prime Minister were studiously non- committal. It is not certain what relations Switzer- land, with her voluntary tradition of neutrality, or Austria, with the Russians on her borders and committed to neutrality by international treaty, will wish to have with such an area. And Portugal is geographically and culturally so far removed from the other potential members that it' she joined she would be rather like • those 'parts of Flint' which one finds anomalously cropping up in the maps in the middle of other counties of Wales.
We cannot, until we know a great deal more about details, decide whether it is wise to favour such a scheme. But at least we should understand that if it is adopted it may well lead to much graver consequences than are commonly understood. All history shows that nations cannot have exception- ally preferential economic relations with one another and yet continue to maintain completely independent political sovereignty. In this modern age of Social services, quotas and subsidies there are a hundred and one ways of influencing the flow of trade other than by crude tariffs. If there is to be genuine free trade between a body of nations, then there must be complicated and detailed agreements on which practices are to be permitted and which forbidden; nor are such agreements of much value unless there is a judicial authority to enforce them; nor can the judicial authority be effective unless there is a political authority to modify such arrangements as prove unworkable. In short, this new Free Trade Area of Britain and the Scandinavian countries will either prove to be an exercise in hot air or, like the German Zollverein of the last century. it will inevitably develop from an economic into political unit—into something, whatever its precise form, like a federal union of Northern Europe. It is not easy to see how the Swedes will be able to continue their traditional policy of neutrality if all their partners arc members of NATO. It is not easy to see how the bonds of the
Commonwealth can fail to be weakened, if the Commonweath should be outside this area and the British within it.
The Swedes, it is only fair to say, specifically deny any wish to build a counter-bloc to the Six; and no doubt they are sincere. But such organisa- tions, if they develop at all, develop according to the laws of their own logic rather than according to the wishes of their originators. On the BBC recently, for instance, Mr. Baklund, the Swedish Director of Information, recommended the plan to the British with the argument that today Germany sells more to Sweden than she does to France and Italy combined, and that it would be worth Britain's while to obtain access to that Swedish market at preferential terms over those given to the Germans. One can see how that argu- ment might appeal to the British, but the Germans will find it unwelcome. I do not say that such a Northern European union is necessarily a bad thing. Yet it would be ironical if such a development should take place in Northern Europe at the same time there happens to be a similar development in the coun- tries of the Six—so that the main result of the movement for European unity would be a Europe irrevocably divided in two. We may find ourselves compelled to consider the Swedish plan, for we cannot afford to stand alone; but surely, if it is in any way possible, it is far better to build some- thing bigger than, and inclusive of, the Common Market. There are many difficulties in the way of establishing this larger unit, but the recent con- ference of the Institute of International Affairs in New Zealand showed that the Commonwealth is anxious to explore its possibilities. It would be a pity if we committed ourselves irrevocably to another plan before it has been fully explored.
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