Friday

23rd Feb 2018

Opinion

Time for new relations between EFTA and the EU

  • Last year's EFTA summer ministerial meeting in Bern, Switzerland. (Photo: EFTA Secretariat)

For more than two decades the four member states of the European Free Trade Association (EFTA) have not taken a joint approach when it comes to their trade with the European Union.

Three EFTA members - Norway, Iceland and Liechtenstein - are also members of the European Economic Area (EEA), which gives them access to the EU's single market.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

But the fourth EFTA country, Switzerland, has instead opted to negotiate a number of bilateral agreements with the EU over the years, covering the country's various interests. The Swiss took this route after its voters rejected membership of the EEA in a referendum in 1992.

It has been well over twenty years since the EEA Agreement came into effect and the EFTA countries went on different paths in their trade relations with the EU. So now is a good time as any to review this cooperation between EFTA and the EU.

Action is needed mainly because the current arrangements, while still functioning, can and should be improved for the benefit of all the participants.

After all, the arrangements themselves can never be the objective, but instead the aim should be to secure the interests of those involved as well as possible.

The EU has been in favour of reviewing its trade ties with the EFTA countries by simplifying the situation and by getting them all under the same umbrella.

There have been suggestions from Brussels that Switzerland should join the EEA, but this point of view is far from receiving the necessary support among the country's voters and politicians.

Brussels has also talked about the EFTA/EEA countries accepting direct authority from the EU institutions in certain areas, which is yet another initiative that lacks support in the four countries.

Furthermore, none of the EFTA states look likely to become EU members in the foreseeable future.

Keeping it simple

The interests of the EFTA countries and the EU would be far better in the long-run with a reformed relationship, simplifying the situation for everyone involved.

The reforms could create a unified, stronger and clearer framework, in line with the most recent and modern EFTA and EU trade agreements with other countries around the world.

In recent years, both EFTA and the EU have emphasised the need for so-called comprehensive second generation free trade agreements.

For example, the EU has concluded a deal like that with South Korea and Canada, and has also been in such talks with the United States.

Meanwhile, EFTA has done the same in the case of Singapore and Hong Kong. Iceland and Switzerland have concluded deals as individual countries with China. EFTA is also working towards upgrading its older free trade deals to second generation ones.

Second generation free trade agreements differ from the more traditional type, as they not only cover trade in goods but also in areas such as: services plus investments, protection of intellectual property rights, public procurement, technical regulations, and many more.

In other words, almost all of the important areas currently covered both by the EEA Agreement and the Swiss bilateral accords.

When these two arrangements were originally put in place, second generation free trade deals simply did not exist.

Next generation

A second generation free trade agreement would greatly simplify the situation for both EFTA and the EU.

Instead of a double set of institutions, as in the case of the EU and the EFTA/EEA countries, and a large number of bilateral agreements between the EU and Switzerland, there would be only one joint comprehensive agreement.

Furthermore, this renewed document would be in line with the most modern global trade agreements, which have become the preference and are being negotiated internationally by both blocs.

It would mean that the EU would not be faced with the reality anymore that three EEA members do not belong to the EU, since the area would correspond fully with the EU's boundaries.

Relations with the EFTA countries would be governed by a modern comprehensive free trade arrangement which is obviously considered sufficient to cover the complex interests of the largest economies in the world.

The time has simply come for a new EFTA-EU relationship; one that would be a better way forwards for everyone concerned.

The author, Hjortur J. Gudmundsson, is a historian and MA in International Relations who lives in Reykjavík, Iceland.

MEPs approve Canada trade deal amid protest

Amid protests in front of the European Parliament's Strasbourg building and after heated debate among MEPs, the landmark trade deal with Canada was approved with a comfortable majority.

TTIP's future in Trump's hands

EU commissioners admit they "frankly don't know" what the US president-elect intends to do with the US-EU trade talks.

News in Brief

  1. EU parliament president: 'The immigration problem is Africa'
  2. May to unveil EU departure strategy next week
  3. Pregnant workers may be dismissed, EU court rules
  4. Romanian minister demands anti-corruption prosecutor fired
  5. Luxembourg and Ireland pay highest minimum wages
  6. Freedom of expression under threat in Spain, warn MEPs
  7. Report: EU to increase sanctions on Myanmar
  8. Juncker 'worried' by Italian elections

Stakeholders' Highlights

  1. Aid & Trade LondonJoin Thousands of Stakeholders of the Global Aid Industry at Aid & Trade London
  2. Macedonian Human Rights Movement Int.European Free Alliance Joins MHRMI to End the Anti-Macedonian Name Negotiations
  3. Mission of China to the EUChina-EU Tourism Year to Promote Business and Mutual Ties
  4. European Jewish CongressAt “An End to Antisemitism!” Conference, Dr. Kantor Calls for Ambitious Solutions
  5. UNESDAA Year Ago UNESDA Members Pledged to Reduce Added Sugars in Soft Drinks by 10%
  6. International Partnership for Human RightsUzbekistan: Investigate Torture of Journalist
  7. CESICESI@Noon on ‘Digitalisation & Future of Work: Social Protection For All?’ - March 7
  8. UNICEFExecutive Director's Committment to Tackling Sexual Exploitation and Abuse of Children
  9. Nordic Council of MinistersState of the Nordic Region 2018: Facts, Figures and Rankings of the 74 Regions
  10. Mission of China to the EUDigital Economy Shaping China's Future, Over 30% of GDP
  11. Macedonian Human Rights Movement Int.Suing the Governments of Macedonia and Greece for Changing Macedonia's Name

Latest News

  1. EU-Morocco fishing deal casts doubt on EU future foreign policy
  2. EU leaders put 'Spitzenkandidat' on summit menu
  3. European far-right political party risks collapse
  4. The key budget issues on EU leaders' table
  5. EU leaders to kick off post-Brexit budget debate
  6. Greek government's steady steps to exit bailout programme
  7. Frontex: Europe's new law enforcement agency?
  8. Poland and Greece broke EU environment laws, rules court

Stakeholders' Highlights

  1. Swedish EnterprisesHarnessing Globalization- at What Cost? Keynote Speaker Commissioner Malmström
  2. European Friends of ArmeniaSave The Date 28/02: “Nagorno-Karabakh & the EU: 1988-2018”
  3. European Heart NetworkSmart CAP is Triple Win for Economy, Environment and Health
  4. European Free AlllianceEFA Joined the Protest in Aiacciu to Solicit a Dialogue After the Elections
  5. EPSUDrinking Water Directive Step Forward but Human Right to Water Not Recognized
  6. European Gaming & Betting AssociationGambling Operators File Data Protection Complaint Against Payment Block in Norway
  7. European Jewish CongressEJC Expresses Deep Concern Over Proposed Holocaust Law in Poland
  8. CECEConstruction Industry Gets Together to Discuss the Digital Revolution @ the EU Industry Days
  9. Mission of China to the EUChina-EU Relations in the New Era
  10. European Free AlllianceEnd Discrimination of European Minorities - Sign the Minority Safepack Initiative
  11. Centre Maurits Coppieters“Diversity Shouldn’t Be Only a Slogan” Lorant Vincze (Fuen) Warns European Commission
  12. Dialogue PlatformWhat Can Christians Learn from a Global Islamic Movement?