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Andrew Lilico: How significant a player could a CANZUK Federation be?

I have written previously that I believe the key question for the UK with reference to the EU is not "Should we leave or not?" - regardless of the benefits the arrangement has provided to us so far, we will shortly have no realistic option but to leave.  Neither is it "After we leave, should we have a Swiss-type, a Norwegian-type, or a Turkish-type agreement with the EU?" - obviously there will be some kind of trade agreement struck with our former EU partners, but that won't even make page 5 of the newspapers (just as when we make new trade agreements with India or South Africa, that doesn't make the front pages, either).

No, the key question isn't about our relationship with the EU at all.  It's about what we should do instead.  I've previously reviewed a number of the options and argued that the most plausible deep relationship post-EU would be with Canada and Australia, to which we can add New Zealand.  Such a combination is often referred to by the acronym "CANZUK".

When I have raised this notion in the past, I find that many folk in the UK think it has a certain romantic attraction, but they worry on two points.  First, they assume that the Canadians and Australians and New Zealanders would feel too betrayed by the UK's having deserted old alliances for the EEC in the first place, and are emotionally now much more committed to the US (in Canada's case) or China (in Australia's case) to be interested in re-heating old arrangements.  I'll deal that that question another time.  Second, they assume that, whatever its cultural attractions, a CANZUK Federation would be too small to be economically or geopolitically attractive to the participants.  That is the issue I wish to engage with here.

A politically unified CANZUK Federation would be the largest country in the world in terms of area, at 18,188,325 km2, exceeding even Russia (17098242 km2).  The population, at 124m, would be the 11th largest in the world, just behind Japan.  With such a large surface area to play with, a CANZUK Federation could afford to be a very aggressive importer of people.  I would assume the main point of entry would be via the UK, which could then process immigrants for a few years before they were entitled to entry to other parts of CANZUK.  In due course, despite taking in large numbers of immigrants, I would anticipate the UK becoming a net exporter of people.

The economy, at US$5.98tr would be the fourth largest in the world (behind the US, the EU Federation, and China, but just ahead of Japan).  Total trade would be US$2.5tr, versus $1.6tr for Japan or $3.9tr for the US.  GDP per capita would be $US48k, almost identical to that of the United States (Australia and Canada both have GDP per capita well in excess of that of the US).  Thus both in terms of inward volumes and international trading perspective, a CANZUK Federation would be a major global economic player.

In terms of defence spending, CANZUK would have a combined $111bn, the third largest in the world, a little behind China's $166bn but well ahead of Russia ($91bn) or France ($59bn).  With the largest surface area, a geography spreading from the North Pole to the Southern Ocean, and nuclear weapons, CANZUK would be one of the world's great military powers.  Indeed, the provision of a nuclear umbrella for Australia would be a significant attraction of the arrangement to that country - links of blood and history make it much more plausible that a CANZUK nuclear deterrent would be used to respond to an attack on Australia, if it came to that, than any deterrent shield provided by the US.

There remain many further issues to address and unpack, but these statistics demonstrate, I hope, that in terms of narrow scale, a CANZUK arrangement would be amply large enough to provide considerable economic and geopolitical attraction.


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