Brexit supporters are planning New Year’s Eve-style celebrations on 31 January, the day the country leaves the EU. But it’s the morning after that matters more.
Nigel Farage’s Brexit Party will spend £100,000 on a Brexit celebration party in Parliament Square, where onlookers will be treated to a fireworks display, music and comedy performances and – they hope – a clock strike at 11pm, marking the moment the UK officially leaves the EU. The government is also planning a “national celebration”, a Downing Street source said. And while nothing significant will change overnight, the next 11 months will be a flurry of activity, negotiations and legwork to get an EU-UK trade deal done.
But trade expert David Henig says the work to be done extends far beyond the “Canada-style” free trade agreement that prime minister Boris Johnson wants. That agreement is just one of five major deals that need to be struck before the end of 2020 – the others being financial services, fisheries, data sharing and Northern Ireland.
The European Commission’s new president, Ursula von der Leyen, said in London this week that it will be “basically impossible” to negotiate a comprehensive free trade deal by the end of the year (EUROPE 12399/5). After meeting her, the prime minister reiterated that the UK would not extend the “implementation” period beyond 31 December 2020.
But new trade commissioner Phil Hogan is treating the pronouncement with a pinch of salt, saying he’s not too worried about the initial phase of negotiations, and told a gathering of ambassadors in Dublin this week that Mr Johnson has said “a lot of things that ultimately he didn’t do”. “From our point of view it is important that we move from stunt to substance,” he told the Irish Times newspaper. “It would be helpful if the focus was on content rather than timetables.”
And that content will be contentious. Mr Johnson said this week that the UK will “maintain control” of its fishing waters and immigration system, identifying what he views as his trump cards. Fisheries, while not a major part of the UK economy, is politically sensitive and plays well with voters. However, the UK will need to figure out what it will do with any extra fishing opportunities it gains, as most of the UK’s catch is exported to the EU, and most of the fish that British people eat is imported. The UK is also obliged by the UN law of the sea to make access and conservation deals with neighbours outside the EU, such as Norway and the Faroe Islands.
Immigration and citizens’ rights is another major asset the UK will seek to play. While the withdrawal agreement sets out an offer for the next 5 years, the Daily Telegraph’s Peter Foster has seen a letter that chief EU negotiator Michel Barnier sent to Brexit secretary Stephen Barclay before Christmas, expressing concerns about the UK’s commitment to protect the 3 million or so EU citizens currently resident in the country.
The Withdrawal Agreement Bill – the legislation that has just passed the House of Commons (EUROPE 12400/6) and will win its way through the Lords next week – has been amended, effectively taking some powers away from an Independent Monitoring Authority (IMA) due to be set up to police citizens’ rights after Brexit. MEPs have also raised concerns about the issue (see other news).
But the EU is still in the driving seat, at least for the moment. It has the larger market, on which the UK is dependent for most of its trade. The EU will decide whether a future trade deal will be a “mixed” agreement, requiring the approval of all 27 EU governments – or whether it remains within the Commission’s own competence. And the EU is setting the priorities and timing of the talks, with Brexit diplomats meeting last Wednesday for a first seminar on future trade.
The EU’s expertise on trade – particularly new director-general for trade (and Mr Barnier’s former deputy) Sabine Weyand – puts it way ahead of the UK, where new trade competences are still being worked out. “Domestically, government and parliament are not yet set up coherently to manage all these negotiations,” David Henig tweeted. “Devolved involvement is unknown, and business have to prepare both for no trade deal and to lobby for their interests in a deal.”
According to the Eurasia Group think tank, the UK’s decision to reject the EU’s’ level playing field demands ahead of the talks is likely to lead to “a bare bones Free Trade Agreement, mainly on goods, potentially with tariffs, and a commitment to keep talking on other issues”. And the European Central Bank’s Klaas Knot says that a no-deal Brexit remains a possibility this year. (Sarah Colins)