On the march in Copenhagen

The atmosphere on the streets was the antithesis of the gloom inside the centre

Panda bears with flames coming out of their heads, flying blue dragons, the usual rake of tree-hugging environmentalists and an inordinate number of polar bears took to the streets of Copenhagen today. Estimated at 100,000 strong, the march set off towards the Bella Centre, the venue for the UN's COP15 climate summit, at 2pm today. There they'll greet world leaders and give them a piece of their mind, irrespective that no one of note has shown up yet.

Suited up like Robocop, the Danish police are huge and ready to take on any climate heros, but so far they have been left with very little to do. Since an early ruckus in which 400 people -- part of a peripheral march by the anarchist group "Never Trust a Cop" -- were arrested, the march has been overwhelmingly peaceful.

At 1pm speakers greeted the crowd outside Copenhagen Town Hall. The usual rhetoric and a guest appearance by the new climate poster girl Helena Christensen left me withering and cynical in the cold. But the spirit is there and the atmosphere is a positive antithesis to the doom, gloom and general angst among those inside the centre.

Whether organisers planned this march in protest or solidarity with COP15 is hard to tell. Their demands are vague. They are calling for "climate justice" and "a legally binding agreement". But they don't talk about numbers, and they avoid the kind of contentious debate over targets that has already caused drastic divisions within the conference.

The crowd is diverse and illustrates one of the most interesting aspects of this summit. Here, for the first time, environmental action groups have come together with development agencies to acknowledge the threat of climate change to human lives. It is no longer just a movement of the green elite, a luxury guilt that only rich nations can afford. References to the human effects of climate change are ubiquitous. As Naomi Klein said yesterday, this conference is about "people, not polar bears".

As the first seven days round up, it's clear that this first week was all about the little guys -- letting small island states and the less significant developing countries have their voices heard before China, the US and the EU fly in and bang up a deal. Whatever influence figures such as Sudan's Lumumba Di-Aping might have felt in the past six days (speaking out against the leaked "Danish text") will be obliterated once the real bargaining begins. What could prove significant, however, are the alliances that smaller nations have had the chance to make, if these can withstand the bargaining tactics of the greater powers. These tactics are the kind that stopped the Philippines negotiator and "dragon woman" Bernarditas Muller from joining her country's delegation at the summit.

But then this kind of cynicism has no place here on the streets of "Hopenhagen", and I have to get back to the march. After all, a bit of positive people action can't do any harm.

 

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What is the EU customs union and will Brexit make us leave?

International trade secretary Liam Fox's job makes more sense if we leave the customs union. 

Brexiteers and Remoaners alike have spent the winter months talking of leaving the "customs union", and how this should be weighed up against the benefits of controlling immigration. But what does it actually mean, and how is it different from the EU single market?

Imagine a medieval town, with a busy marketplace where traders are buying and selling wares. Now imagine that the town is also protected by a city wall, with guards ready to slap charges on any outside traders who want to come in. That's how the customs union works.  

In essence, a customs union is an agreement between countries not to impose tariffs on imports from within the club, and at the same time impose common tariffs on goods coming in from outsiders. In other words, the countries decide to trade collectively with each other, and bargain collectively with everyone else. 

The EU isn't the only customs union, or even the first in Europe. In the 19th century, German-speaking states organised the Zollverein, or German Customs Union, which in turn paved the way for the unification of Germany. Other customs unions today include the Eurasian Economic Union of central Asian states and Russia. The EU also has a customs union with Turkey.

What is special about the EU customs union is the level of co-operation, with member states sharing commercial policies, and the size. So how would leaving it affect the UK post-Brexit?

The EU customs union in practice

The EU, acting on behalf of the UK and other member states, has negotiated trade deals with countries around the world which take years to complete. The EU is still mired in talks to try to pull off the controversial Transatlantic Trade and Investment Partnership (TTIP) with the US, and a similar EU-Japan trade deal. These two deals alone would cover a third of all EU trade.

The point of these deals is to make it easier for the EU's exporters to sell abroad, keep imports relatively cheap and at the same time protect the member states' own businesses and consumers as much as possible. 

The rules of the customs union require member states to let the EU negotiate on their behalf, rather than trying to cut their own deals. In theory, if the UK walks away from the customs union, we walk away from all these trade deals, but we also get a chance to strike our own. 

What are the UK's options?

The UK could perhaps come to an agreement with the EU where it continues to remain inside the customs union. But some analysts believe that door has already shut. 

One of Theresa May’s first acts as Prime Minister was to appoint Liam Fox, the Brexiteer, as the secretary of state for international trade. Why would she appoint him, so the logic goes, if there were no international trade deals to talk about? And Fox can only do this if the UK is outside the customs union. 

(Conversely, former Lib Dem leader Nick Clegg argues May will realise the customs union is too valuable and Fox will be gone within two years).

Fox has himself said the UK should leave the customs union but later seemed to backtrack, saying it is "important to have continuity in trade".

If the UK does leave the customs union, it will have the freedom to negotiate, but will it fare better or worse than the EU bloc?

On the one hand, the UK, as a single voice, can make speedy decisions, whereas the EU has a lengthy consultative process (the Belgian region of Wallonia recently blocked the entire EU-Canada trade deal). Incoming US President Donald Trump has already said he will try to come to a deal quickly

On the other, the UK economy is far smaller, and trade negotiators may discover they have far less leverage acting alone. 

Unintended consequences

There is also the question of the UK’s membership of the World Trade Organisation, which is currently governed by its membership of the customs union. According to the Institute for Government: “Many countries will want to be clear about the UK’s membership of the WTO before they open negotiations.”

And then there is the question of policing trade outside of the customs union. For example, if it was significantly cheaper to import goods from China into Ireland, a customs union member, than Northern Ireland, a smuggling network might emerge.

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.