At the end of the year, Great Britain is also leaving the internal market and the customs union after leaving the EU. Will London and Brussels manage to avert chaos with a trade pact? Hope is fading – but it’s not over yet.
Brussels. Important week for Brexit – once again. In the next few days it should become clearer whether the more than four-year-old saga of Britain’s exit from the EU will come to a light end.
This Monday, the EU Commission will once again urge Great Britain to comply with the current exit agreement. The last round of negotiations on the follow-up contract, which is to regulate trade relations in the future, will begin on Tuesday. The most important information on the current state of affairs:
Why is there a dispute about the withdrawal agreement?
With its so-called Internal Market Act, the British government wants to cash in on some clauses of the exit agreement that came into force before Brexit at the end of January.
This concerns special rules for Northern Ireland, which are intended to prevent a fixed border with the EU state Ireland: The British province remains more closely linked to the EU customs union and the EU internal market than the rest of the country.
Prime Minister Boris Johnson laments that that would divide the UK. The EU counters that Johnson negotiated the treaty personally and had it ratified by parliament. The clauses are necessary to keep the peace on the Irish island.
What does the dispute mean for future relationships?
A trade agreement is planned for early 2021. Then the Brexit transition phase will end, and Great Britain will also leave the customs union and the internal market. But the EU says: why sign a new contract with a partner who does not keep the old one? She has ultimately asked London to withdraw plans to violate the withdrawal agreement by Wednesday. This Monday it’s about the so-called Joint Committee, an arbitration body. So far, London is sticking to its plans. If it stays that way, there will be no follow-up agreement, say EU diplomats.
What are the sticking points?
The EU offers its ex-member a very close trading partnership: unlimited movement of goods without customs duties. But it calls for the same environmental, social and subsidy rules. In short: equal competitive conditions under the keyword “level playing field”.
However, the UK does not want to be influenced by the EU when it comes to its future standards – Brexit’s main goal is self-determination. In addition, London sees the second sticking point: access for EU fishermen to the rich British fishing grounds. Eight rounds of negotiations brought no tangible results, but audible frustration on the part of EU negotiator Michel Barnier. Round nine runs until Friday. Johnson set the deadline for October 15.
What are the chances that it will still work out?
The Brexit expert at the European Policy Center in Brussels, Fabian Zuleeg, sees black. “We are clearly heading for a no-deal,” he said last week. Elvire Fabry of the Jacques Delors Institute made a similar statement: “The Single Market Act was of course a shock to everyone.” She is now even more pessimistic. But there are also other voices.
A British government spokesman spoke of “constructive discussions” last week after the meeting between EU negotiator Barnier and his British colleague David Frost. “Both sides still see a broad trade pact as a real possibility,” said the Bloomberg news agency. The British Brexit expert Anand Menon from the think tank UK in a Changing Europe criticizes Johnson’s policy as haphazard, but says: “I think the Prime Minister wants a deal rather than no deal.”
What happens without a contract?
An economic break without an agreement means above all that both sides would have to raise tariffs. That would make goods more expensive and processing at the border would be tough and time-consuming. Dozens of legal issues would not be settled, from the license for train drivers to travel documents for pets.
The Business Europe association warns of “devastating consequences for companies”. Researchers at London’s King’s College estimate that a no-deal Brexit could hit the UK economy three times as hard as the Covid-19 crisis. The British Minister of State Michael Gove also reported a “worst-case” scenario: In January there could be traffic jams with 7,000 trucks on the border with France. But that also applies to a contract, because more control should be exercised even without tariffs.