The consequence of stated government policy would be a delayed crash-out departure at the end of the transitionby David Henig / November 6, 2019 / Leave a comment
Briefly, there was just a hint that the Brexit dialogue might start reflecting international negotiating norms. That in the event of a Conservative majority the UK would leave the EU at the end of January 2020, then recognising that a free trade deal with the EU could not be achieved during the 10-month transition, accept an extension and give ourselves until the end of 2022 to deliver the future relationship. Three years to conclude an FTA with the EU would be ambitious in light of its previous timescales, but perhaps given the unique circumstances just about achievable.
Sadly, the UK experience since 2016 has shown that any suggestion of adopting international norms or best practice, such as sensible schedules or ensuring your policies have domestic support, does not last long in the hands of ministers. Their determination to prove that Brexit means Brexit, and that whatever Brexit means it should be done badly, prevails. So it was to prove, as first Boris Johnson said he saw no reason why we’d need an extension to the transition, then Michael Gove confirmed no extension beyond the end of 2020. Never mind that the EU has never moved at such speed before, that the UK does not yet know the detail of what we want or what the EU may ask—it has to be end 2020.
Just to check I wasn’t missing something obvious I consulted with fellow trade experts, with experience of negotiating FTAs for other countries. To be fair, they suggested I wasn’t completely correct about EU timescales. If you’re prepared to sign up for whatever the EU prepares, they said, you might be able to get a deal in time. Even given the flexibility of what Brexit may mean, however, I wasn’t sure it could possibly mean signing up to everything the EU wants.
The prime minister has said though that we can make a deal more quickly because we start from complete alignment with the EU. That might be the case if we were prepared to stay like that, but again, Brexit surely doesn’t mean continuing to align ourselves with every EU rule forever. Wherein lies the essential point: a trade deal is for life, or at least a mighty long time, not just for Christmas 2020. And when on a journey it tends to be useful to know your destination as well as the starting point.
An alternative explanation for the optimism is that actually all we want is a deal to remove tariffs, and that this in itself should be relatively simple. On the basis that trade is good, the EU will then be fine with a simple zero-tariff deal, and meanwhile global Britain will start conquering foreign markets. It is hard to square this vision however with any previous agreement the EU has made, with any other country. After all, it is the most ardent Brexit supporters who point out frequently just how protectionist they believe the EU to be. They always argued it was too closed to global markets, yet suddenly they are expecting a complete change just for the UK?
This also isn’t the Free Trade Agreement the UK envisages, at least according to the Political Declaration agreed by the Johnson government with the EU. Although not currently binding on either party, it is hard to square a basic FTA with the statement “This partnership will be comprehensive, encompassing a Free Trade Agreement, as well as wider sectoral cooperation where it is in the mutual interest of both Parties.” Indeed, the Johnson government wanted to ensure the negotiating objectives for the next round of Brexit reflected the PD, which was to be enshrined domestically in the Withdrawal Agreement Bill.
It seems that the UK government does then really believe that a full Free Trade Agreement can be completed in 10 months, or that it is lying about not seeking an extension, or comfortable with Great Britain having no trade agreement with the EU (Northern Ireland will be treated differently under the Withdrawal Agreement). We know many Conservative MPs would be comfortable with no trade deal being in place, as they simply don’t believe the negative economic impacts widely forecast. But let us assume for the moment that the government is being sincere and thinks a deal is achievable by the end of 2020.
On the EU side, the Commission will need a mandate for negotiations from the European Council, and the European Parliament to have a say. That’s going to take at least a couple of months, but could easily take longer with some complex questions as to what level of access to the EU the UK should have, and what the cost should be, for example in terms of fishing rights, access to EU regulatory bodies, the role of the European Court of Justice and movement of EU workers to the UK, to name but a few. Meanwhile on the UK side, the government will need to ascertain our own negotiating priorities, including for example the relative demands in areas of financial services, fishing, farming, and pharmaceuticals, and go through whatever parliamentary processes it decides. Then we need to go through the entire negotiation, for the entire economy, completing this in six months at most, before ratification and implementation in December 2020. To add another “f,” forget it.
In reality the first months of a negotiation are spent understanding the other party’s approach, which for the EU is how it treats third countries, and for the UK is as yet unknown. Only then does one get down to the detail, and the really thorough discussions on what can be achieved in each area. There is a reason why those experienced in EU negotiations believe this to be a five-seven years’ long process.
Promises, promises, of course. There’s an election to win. But there’s also UK business to support, and more than anything they need some direction, to invest with some confidence. While the government persists in denying the realities of trade negotiations, the uncertainty of Brexit continues. Promising not to extend Brexit beyond 2020 means even more of this.