Time to Secede: Separatist Movements and the Search for Independence

On 18 September 2014, the Scottish people were asked the following question: “Should Scotland be an independent country?” They answered in the negative — just. Less than two years later, the UK government asked its constituents whether they would like to leave the EU or stay put. As we all know, they voted to leave, albeit by the thinnest of slivers. On 1 October 2017, the people of Catalonia were asked whether they would prefer to remain part of the Spanish state or pursue their ambitions to be an independent republic. The answer was emphatic: 92% wanted to break away. What, might we ask, is going on in Europe?

Are these separatist movements anomalies — or are we seeing the start of a trend that favors protectionism and independence over unity and integration? If it is the former, we can chalk it up to the constant waxing and waning of political entities that has been occurring since long before the creation of the EU (or the European Economic Community, as it was originally known) in 1957. However, if it is the latter, then we had better be prepared for what comes next. Will we soon be booking tickets to visit the United States of Northern Italy? How about the State of Bavaria? Or will we find ourselves musing about whether or not the Republic of Flanders is supposed to be lovely at this time of year?

Secession movements occur when a region of a country wishes to break away and become its own separate state. This can occur for ethnic, economic, or political reasons, and as such it is a topic that cannot help but stir up polemic issues of nationalism, identity, and dormant historical grievances. For this reason, it is a particularly brittle topic to analyze objectively. Nonetheless, the phenomenon of secession is well worth considering, especially in light of the increasing numbers of alternative citizenship- and residence- by-investment programs on offer in the world today, which tend to benefit smaller countries disproportionately. This final point is significant because, by definition, secession entails the creation of smaller countries.

In Europe alone, the past few years have seen a noticeable upsurge of radical populist parties: for example, Nigel Farage’s UK Independence Party; Geert Wilders’ Party for Freedom in the Netherlands; Marine Le Pen’s National Rally in France; Viktor Mihály Orbán’s Fidesz in Hungary; Alternative for Germany; the People’s Party in Austria; and the Five Star Movement in Italy. It should be noted that not all of these movements have secession on their minds, but they are all broadly ‘Euroskeptic’ and suspicious of cosmopolitanism.

On the one hand, it is tempting to dismiss these movements as idiosyncratic in an otherwise pervasive climate of globalization and political liberalism. When one puts them in the context of a tumultuous past decade for the EU, which has included the Eurozone crisis, the migrant crisis, and Brexit itself, however, now would seem to be a good time to get serious about what would actually be the implications of successful secessionist movements.

Focusing just on Europe (as opposed to other well-known cases such as Quebec and Kurdistan, for instance), several proposed secessionist movements could dramatically reconfigure the borders, power structures, and major economies of the region as we know them. The highest- profile examples of breakaway movements are probably in Scotland and Catalonia, but there are other regions that harbor their own serious ambitions for independence. The examples of Bavaria, Northern Italy, and Flanders were alluded to earlier, but Corsica, the Basque Country, and Venice are also areas tussling for self-determination.

 

Catalonia, with a population of roughly 7.5 million, accounts for 16% of Spain’s population and 20% of its GDP, making it one of the leading economically active regions in the country. Should Catalonia gain independence, it is reported that it will have a GDP that surpasses Finland’s

 

For the sake of argument, let us indulge in a quick hypothetical scenario. Imagine that all of the regions above successfully seceded from their current host nations, thereby becoming brand new, independent countries. What would the consequences be? Would these regions even survive and, if so, would they become more or less desirable regions in which to reside? What could they reasonably offer their citizens?

In the case of the resource- and industry-rich areas of Catalonia and Northern Italy, one imagines that secession might not necessarily leave those regions poorer in the long run. Catalonia accounts for 16% of Spain’s population yet its EUR 215.6 billion economy (which is larger than that of most countries in the Eurozone) generates over 20% of Spanish GDP. Catalonia’s exports of EUR 65.2 billion represent more than 25% of the national total and, at about EUR 37 billion, foreign investment in Catalonia accounts for more than 25% of inward investment to Spain.

The highly developed and industrialized Northern Italy appears to be even more self-sufficient than that, generating 75% of the country’s wealth, with Milan by itself generating about 10% of national GDP despite only containing 2% of the population. To place that in perspective, Milan alone is richer than Sweden — and, at the other end of the country, Naples is poorer than the Czech Republic.1 Scotland, the Basque Country, Corsica, Venice, Bavaria, and Flanders might not fare quite so well if they achieved independent status. If those regions have been paying attention to the upward demand for alternative residence and citizenship, however, they might be tempted to establish their own residence- or citizenship-by-investment programs. After all, if residence- and citizenship-by-investment have taught governments anything, it is that a small nation with a high quality of nationality has a fortune to gain from investors looking to expand their citizenship portfolios. Thus, imagining that each region above were allowed to keep its status as a member of the EU, they would unambiguously represent an attractive investment opportunity for high net worth individuals seeking alternative citizenship. Keeping EU status for breakaway regions, however, is far from guaranteed.

In every case of secession, a newly independent state would doubtless need to re-negotiate its position as a member of the EU. Rather than cause the readmission of each new entity into Europe, however, the blossoming of several new independent states — of varying degrees of self-sufficiency — would more likely spell the end of the EU and the Schengen Area as we know it. The subsequent investment value for new would-be citizens would therefore also be massively diminished.

Irrespective of what happens to the EU, though, one would certainly expect each new country to try to maximize its assets in every way possible in order to fill its state coffers. Would we therefore see the creation of new tax-free zones? Of bilateral alliances with other regions looking to get a foothold in Europe? Would Europe see the growth of areas no longer bound by European law, where ordinarily illicit activities are tolerated as a means to boost tourism? The ramifications are seemingly endless.

In terms of access, could it be that successful secessionist movements would paradoxically lead to more porous national borders, because the more countries in the region, the less practicable it would be to try to maintain hard frontiers? What would be the implications for trade, travel, diplomacy, and bureaucracy? The consequences are potentially so complicated that one would be forgiven for not wishing to think about it. The simple recognition of Britain’s status outside of the EU already has its interlocutors baffled and, relatively speaking, Britain’s leaving the EU is a straightforward example.

If the practical complexities of these issues are hard to digest, it is also worth considering the sentiment that often underpins them. After all, there does appear to be a meniscus of distrust to secessionist movements. The unspoken assumption is that the ‘other’ is different and not to be trusted. A major question to ask today, therefore, is whether we are continuing with Enlightenment values of free trade, liberal democracy, and increased globalization, or whether we are in fact emerging from such a phase and entering into something new. If we are, indeed, entering something new, it behooves us to ask, what is that something?

If we choose to view secessionist movements from the standpoint of a safe, tolerant, peaceful world, it has to be said that the diagnostic signs do not look very good. They include retreat from collaboration, incendiary racial politics, the frosting of trade relations, autocratic leadership, withdrawal from multilateral agreements, and decreased consensus about global issues such as climate change and pollution — the list goes on.

One thing that all would-be independent regions might consider is how to establish sufficiently good diplomatic relations with the rest of the world that they do not risk becoming pariah states. If that obstacle can be overcome, then for smaller countries, opening up a reputable residence- or citizenship-by-investment program might be a sensible next step, as it has been shown to furnish both investors and host nations with considerable benefits. But as indicated above, this comes with a rather large caveat, which is that these programs only work where there is a bedrock of trust, excellent bilateral relations, and a superb quality of nationality. The extent to which new secessionist regions can offer these is so far shrouded in doubt.

Endnote

1 focus-economics.com/countries/italy

Houses rise and fall, crumble, are extended Are removed, destroyed, restored, or in their place ss an open field, or a factory, or a by-pass old stone to new building, old timber to new fires – ‘East Coker’, TS Eliot

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