Europe Has Completely Turned the Tables on Brexit
Britain is paying for threatening to walk away from the EU without a deal.
The U.K.'s obvious turnabout on the desirability of a no-deal exit from the European Union shows how completely the tables have turned in the Brexit negotiations. With less than a year to seal a trade deal, the EU is nudging the U.K. toward an understanding that the only benign outcome is agreeing to a long transition period. That could allow a different U.K. team to emerge with a humbler approach.
Calling Britain's bluff.
Oli Scarff/AFP/Getty Images
David Davis, the U.K. Brexit minister, has written Prime Minister Theresa May a letter complaining that the EU is preparing for the eventuality of trade talks ending without a deal. The EU's Brexit guidance for companies -- such as the European Medicines Agency recommendations for pharmaceutical firms -- makes no mention of any transition period before the U.K. becomes a "third country," an outsider. Instead, they say companies may need to relocate outposts and change procedures in preparation for the U.K.'s withdrawal.
Davis's letter shows that he considered suing the EU over these recommendations but received legal advice not to do it. Instead, he wants to push the European Commission to withdraw the recommendations and encourage U.K.-based companies to lobby against them. But there's no reason for the EU to pull back. As European Commission spokesman Margaritis Schinas said on Tuesday, the EU is "surprised that the United Kingdom is surprised that we are preparing for a scenario announced by the U.K. government itself."
Obviously, the U.K. wants to convince businesses that such a withdrawal was unlikely -- otherwise companies will start moving out soon. But the E.U. doesn't stand to gain anything by effectively promising firms that something will be worked out. That would be unsafe, especially after Davis said in December that a preliminary agreement between May and EU leaders, which opened the way to trade negotiations, was not legally binding. The trust-destroying statement made it necessary for EU agencies to give companies fair warning. They simply must begin renegotiating their own contracts rather than depend on an uncertain wholesale deal on the government level.
The British aerospace industry is already getting a taste of the no-deal scenario. Davis's complaint in the letter about "a growing number of instances where the U.K. is treated differently by EU institutions before we leave the EU" is likely to be a reference to the apparent exclusion of U.K. firms from bidding for contracts for the European satellite navigation system, Galileo. The EU can hardly be expected to welcome U.K. bidders, though, until some sort of agreement is reached on the U.K.'s further participation in the EU space program.
Yet neither that nor the harsh guidance for companies is a sign that the EU really expects a no-deal exit. It's more like a demonstration of how the EU flipped Britain's no-deal threat into a nightmare.
The size of Britain's negotiating failure is enormous -- the EU hasn't shifted its position at all. After Nigel Farage, one of the top Brexit ideologists, met with chief EU negotiator Michel Barnier this week, he came away with the impression was that Barnier still didn't understand why Brexit was happening. "All the rules and all the laws have to be the same for everybody," Farage insisted. That's an easy position to hold, but the U.K.'s options are still the same as a year ago: a Norway-style deal that includes maintaining the free movement of workers with the EU or a Canada-style free trade deal that doesn't cover financial services, the U.K.'s top export. Neither works politically for the U.K.
May has already overruled Davis in order to negotiate the preliminary agreement, essentially accepting every EU demand. With Davis still in the driver's seat in the forthcoming discussion of trade, she may have to do it again. Given how comfortable the EU feels in its position, it's likely that preparations are being made for a favorite European game -- kicking the can down the road, and that May is a silent accomplice in this.
That's a reasonable approach. It allows the U.K. government to put more historical distance between the Brexit referendum and the event itself. Continuing negotiation failures and a mild form of economic fallout could quietly erode pro-Brexit sentiment and prepare the U.K. to reverse course or settle for a Norway-style arrangement plus a customs union. There's a reason why dead-end talks and procrastination have carried the EU so far: They tend to cool the hottest of heads.
Leonid Bershidsky is a Bloomberg View columnist. He was the founding editor of the Russian business daily Vedomosti and founded the opinion website Slon.ru.
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by Leonid Bershidsky
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The Brits' utter incompetence in these "negotiations" has been astounding.
How so?
Read the seed...
Perhaps the Brits made a mistake after all. We shall see.
From my position the only mistakes we've made so far is caving into European demands.
There are no "demands". There are "contractual obligations". The UK could walk away without another word.
But in that case, the EU would have no obligations toward the UK, either. The City could be isolated from EU markets, for example...
"No deal" would be far, far worse for the UK than for the EU. The problem is that the May government, is still today more worried about domestic, day-to-day politics than about the long-term future with the major portion of the UK's commerce.
There are no "demands". There are "contractual obligations". The UK could walk away without another word.
The "contractual obligations" consisted of the agreed budget, and sundry other issues. The EU demands began with the framework for the talks, we gave in, and have been doing so ever since.
"No deal" would be far, far worse for the UK than for the EU. The problem is that the May government, is still today more worried about domestic, day-to-day politics than about the long-term future with the major portion of the UK's commerce.
In the sort to medium term yes, but I would rather see this than remain tied to the EU.
In the sort to medium term
It should read short to medium term
You'll get your wish. The question is at what price. I don't much care for debate over hypotheticals. We obviously don't agree about the cost and how it is being mismanaged.
We shall see...
The point of the article is not Brexit itself. That was a choice from misplaced pride rather than from common sense... but understandable. "The Empire" and all that... People make most of their decisions for emotional motives rather than rational ones.
But once the Brexit decision was made, there were so many possible negotiation paths available, and the May government seems to have made the wrong one each time, beginning by invoking Article 50 before they were ready.
I saw an interview with Michel Barnier in which he was literally scratching his head, asking "What on Earth are yhey about??"
That was a choice from misplaced pride rather than from common sense... but understandable. "The Empire" and all that... People make most of their decisions for emotional motives rather than rational ones.
I'm sorry, but emotion played no part in my decision making process. I'm tired of people making these sort of arrogant assumptions, voting for exit doesn't equate to being a little Englander, or pining after the empire.
But once the Brexit decision was made, there were so many possible negotiation paths available, and the May government seems to have made the wrong one each time, beginning by invoking Article 50 before they were ready.
I agree the May Government has been asinine in their handling of our exit from Europe.