THE European Council meets today and tomorrow and has three top priorities: migration; security and defence; and economic and financial affairs. Brexit is an also ran, further down the agenda. With conflicts over migration policy rocking Angela Merkel’s coalition government in Germany and also creating a stand-off with Italy’s far-right, populist government, Brexit is a serious irritation but not a major priority.
Nonetheless, the EU’s leaders, like Airbus, are deeply concerned at the failing and chaotic state of UK politics with “no deal” once again a genuine possibility. The UK has failed to propose a comprehensive backstop to keep the Irish border open. And there is no coherent UK proposal on the future UK-EU relationship due to Theresa May’s contradictory red lines and the deep splits in her cabinet. Brussels is appalled.
At one point, it seemed the EU might even suspend talks on the future relationship. But now some short, sharp summit conclusions will crisply point out the UK’s failures as the autumn deadline nears.
Few think a withdrawal agreement can be reached by the October EU summit; perhaps by November or December. But it is clear time is running out.
The Prime Minister set out, early this month, a partial proposal for an Irish backstop to kick in if the final UK-EU deal didn’t keep the border open. It suggested the whole UK would stay in the EU’s customs union for goods on a temporary basis. For the EU, Michel Barnier, its chief Brexit negotiator, underlined that a backstop can’t be temporary; the EU’s single market is not open to cherry picking; and the UK’s proposal, as Mrs May admitted, had not addressed the crunch issue of regulatory alignment.
If Northern Ireland or the whole UK doesn’t stay fully compliant with EU rules, there won’t be an open border. Despite all of this, an emerging consensus amongst a number of UK commentators and some senior officials suggests a “landing zone” for a deal is just possible. They suggest the UK could stay in the customs union and single market for goods only.
While this would be cherry picking, it would also mean services didn’t have full single market access. This economic hit for the UK on services could, so this story goes, be traded off against not applying free movement of people. UK-EU services trade could shrink by more than 60 per cent but this is blithely accepted.
It’s a peculiar idea. The UK would leave the EU but effectively stay as a rule-taker for goods. Agriculture would need to be included, too, to avoid a hard Irish border.
It assumes Mrs May goes along with this; that the EU will agree to a fudge over the temporary or permanent nature of the backstop (it won’t); and that the EU will drop its red line on the integrity of its single market. It also assumes the Brexiters will be fobbed off by the misleading idea this “vassal-state” status is only temporary.
And another scenario could rapidly unfold: Westminster might vote, by mid-July, to impose a long-run customs union position onto the Government, with uncertain but sharp political impacts including whether the Government would survive at all. In essence, the UK Government continues to negotiate with itself. If a customs union/single market proposal for goods, however bizarre, was on the table, perhaps some serious talks with the EU could at least start.
But, for now, the twists and turns of UK infighting will continue. The EU is not remotely interested in that. It would like an Irish backstop that works and the UK out. Then it can focus on the big issues on its agenda.
Kirsty Hughes is Director of the Scottish Centtre on European Relations.
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