Brexit will be so painful no one will follow, says Finland

Finland's Finance Minister says Brexit is creating unity among the bloc's 27 remaining nations

Britain’s departure from the European Union sets a precedent. But not in the way you might think. Instead of showing other EU members that it’s possible to exit the bloc, Brexit will make clear just how economically agonising the process is, and frighten others away from ever considering a similar path, according to Finland’s Finance Minister Petteri Orpo. “This divorce, after 40 years of marriage, is inevitably going to be so painful that no one will want to feel it for themselves,” Orpo said in an interview at his office in Helsinki. “I believe it’s going to be a precedent no one will want to follow.”

The UK’s determination to move ahead with Brexit is creating unity among the 27 nations that will remain in the bloc, and making them “more decisive” than they were before, Orpo said. “If that spirit remains, it will take Europe forward.” The EU that emerges from the disruption of Britain’s departure may well function better. 

Finland could accept a so-called two-speed Europe, in which groups of countries would deepen integration at varying paces for different issues within the EU treaties, instead of the current system of a one-size-fits-all model with the occasional opt-out, the minister said.

“There should be no slowdown in developing the EU because of Brexit,” Orpo said. “Quite the opposite, we should push even harder.”

No one knows the economic cost of Brexit. The pound has lost almost 10 per cent since the U.K. voted in June 2016 to leave the EU. Accelerating inflation is hurting consumers as imports grow more expensive, while businesses wonder how to plan investments given all the unknowns. The International Monetary Fund said this week initial signs that Britain is coping economically will probably give way to a weaker outlook in the future as the cost of its departure from the EU filters through.

The real political negotiations on Article 50 will start after the U.K. has held parliamentary elections on June 8, European Commission President Jean-Claude Juncker said on Wednesday. A two-year timetable is possible, U.K. Prime Minister Theresa May said.

Orpo said everyone loses if the talks drag on. Finland, the only euro member in the Nordic region, considers itself a “close partner” of Germany when it comes to allegiances in the EU, he said.

“I don’t think that’s bad policy,” Orpo said. “As finance minister, the policy Germany is pushing as Europe’s largest economy, it’s been very suitable for us.”

©2017 Bloomberg L.P.