As we announced weeks ago, the Marca Andorra Observatory aims to develop a series of articles designed to explore with a constructive critical spirit the negotiations for a future Association Agreement of Andorra with the EU and the different areas where it may have an impact. Probably, this is one of the topics that in the coming years could most affect our country, its citizens, and its businesses, potentially shaping the economic and social trajectory of the upcoming decades. Precisely for this reason, and because it will greatly influence Andorra’s international projection, it’s a topic that deserves to be analyzed from the “country brand” perspective.

The big question is whether Andorra and its citizens need the Association Agreement that has been negotiated with the EU since 2015, or on the contrary, we don’t need it, and it doesn’t offer us anything that could help improve the current strategic position of our country. Those who follow the media surely have noticed that there are opinions of all kinds, from those who passionately defend the future agreement, to those who believe that while not outright rejecting it, we should negotiate more cautiously and without rushing, to those who outright reject the agreement, feeling we are already fine as we are.

The first observation is that the process has been very long, too long, so long that we have gone from a broad political and ideological consensus of the dominant political parties at the beginning and during the negotiations – talking about the 2009-2011, 2011- 2015, 2015-2019 legislatures and even, with some exceptions, 2019-2023 – to the emergence of a series of political parties, with clearly innovative and disruptive ideas, particularly more critical of the negotiations with the EU.

These parties, by the way, have garnered the support of a significant portion of the electorate, sparking a debate that,given their undeniable legitimacy, raises enough doubts to question whether the said agreement, under current negotiating conditions, is beneficial for our country’s interests.

Perhaps we are at the climax of the negotiation and the proximity of the eventual signature of the agreement alters the moods of all parties while discussing what appear to be the final details. However, some statements from representatives of the main European regulators, and even from the European Commission, have not contributed to creating a favorable climate for the agreement. These statements have been largely critical, albeit baselessly, about our banking practices or the low taxation in our country, especially when we have had a Monetary Agreement since 2011 and a tax system approved by both the EU and the OECD.

Clearly, while one of the negotiating parties stakes out territory and shows its claws with a certain arrogance uncharacteristic of someone negotiating for a more united Europe, the Principality of Monaco, although very diplomatically but clearly and forcefully, abandons the negotiation, leaving Andorra and San Marino on their own. Monaco’s reason is that an expert study advises against signing the agreement as it predicts a negative impact on Monaco’s economy in the initial years, even though it would have positive repercussions on the country’s economic diversification in five or six years.

Following this, critical voices have resurfaced, arguing that if Monaco doesn’t see it clearly, imagine Andorra! Therefore, it might be better to halt the negotiations and set our terms with the European Union. And what do the Andorran negotiators have to say about all this? They state that the negotiation is at its climax, with only a few, albeit significant, topics left to define.

However, the benefits that the future agreement could bring to Andorra are evident, and out of electoral coherence and commitment, they intend to conclude the negotiation and sign the best possible agreement for our country, leaving the final decision to the citizens through a binding referendum.

So, what do I think about all this? If the agreement has been negotiated as explained to us, and respects Andorra’s specificities, especially regarding security, public order, and if the freedom of movement of people remains limited by quotas similar to the current ones, and if we maintain border control and our fiscal sovereignty isn’t questioned, maybe we should trust our negotiating leaders and allow them to finish the job they started many years ago.

This job required a significant deployment of resources and personal efforts, all of which would be well spent if the final agreement meets expectations.We can’t forget where we came from and the international pressure that forced us to react in 2007. We had to start the most significant transformation process in our history, leading us to align with the EU and implement a series of economic and tax changes that have earned us the respect of the international community.

This negotiation with the EU should be seen within this context of change and alignment, and in fact, it’s another step in the liberalization of foreign investments in pursuit of the much-desired economic diversification. The opportunities that open up for Andorra with a good agreement, not just any agreement, are truly significant, both for local companies and those from other EU member states or even from outside Europe looking to access the European Single Market through Andorra. In this way, we might finally attract quality foreign investment with value-added companies, moving away from speculative foreign investment, which we have begun to combat.

In this regard, we have previously highlighted the importance of accessing this market and benefiting from European homologation for food products derived from our agricultural and livestock sectors, as currently, we only face obstacles when trying to access new markets. We’ve also stressed the significance of having automatic recognition of degrees awarded by future specialized Andorran universities or the opportunities for our students in terms of studies and jobs with easier access to what the single market offers.

In the same vein, the 2022 Economic Report of the Chamber of Commerce, Industry, and Services, among other demands, and while endorsing the negotiation of the future agreement, has argued that the negotiation might lead to access as a financial regulator to the European Central Bank. This would offer the advantage of being able to more easily access funds to inject into the country’s economy, as well as access to European aid and structural programs, especially thinking about communication infrastructure that would allow our gradual de-isolation.

For the skeptics, those who say that assuming a large portion of European capital will mean an insurmountable logistical effort, a new window of hope is provided by our southern neighbor. In fact, the process has recently begun for our official language to also become official in the EU, which would mean significant savings for Andorra, of course. On this matter, we have heard some critical views from our northern neighboring state, where we have an exceptional ally, our French Co-Prince. It would be necessary to open an active communication channel dedicated to promoting our language, or at least not hindering the request made by the Spanish Government, urged by Catalan.

In conclusion, I would like to end with a favorable opinion on the good agreement that I hope we will achieve and positively welcome the recent critical voices from some European representatives. These voices should allow us to emerge stronger when facedwith a reality that honors the effort made by Andorra in recent years, which has allowed us to build a reputation solid enough to continue and finalize a negotiation on equal terms, with equal interest for both sides. Whether it’s a good or not-so-good deal for Andorra will be decided by the negotiators explaining in great detail the merits of the agreement, and by the citizens who will have to ratify it. From here, this humble Observatory, we will continue to delve into everything known and unknown about the agreement and provide the corresponding critique, always trying to see what positively or negatively affects the future of our country.

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