Kristian Rouz – Britain’s economic success in recent months has encouraged the Tory and Unionist Government to assert its position in the faltering Brexit talks with the EU. The bloc has repeatedly stressed there would be no discussions of post-separation trade deals until the UK pays its divorce bill of some £40 billion.
However, on Sunday the British government rolled out a trade deal proposal.
A “hard Brexit” scenario is no longer a major concern for Theresa May’s cabinet as the murky economic projections related to a hypothetical no-deal with EU course of events has been recently proven wrong. Brexit Secretary and chief UK negotiator with Brussels David Davis reiterated Sunday Britain’s main objective is securing a bilateral trade deal, to take effect in 2019.
Prime Minister Theresa May secured a second stage of Brexit negotiations with the EU Friday and her cabinet is increasing its pressure on the EU to enforce its agenda. This as the British economy has become less reliant on its ties with the continent due to a rise in trade with non-EU partners over the past six quarters.
May said her vision of the trade deal would ensure a greater predictability in bilateral economic ties, which would reassure the private sector and domestic investment.
Secretary David said Sunday he is not expecting the deal to be legally binding, thus taking a more confident stance in the talks. This despite Brussels saying the deal is a possibility, but still it has to be a binding one.
“It’s not that complicated, it comes right back to the alignment point… We start in full alignment, we start in complete convergence so we can work it out from there,” Secretary Davis said.
Secretary Davis also said the UK will only pay its divorce bill to the EU in the event the mutually beneficial trade deal is reached. He, however, reiterated the UK would keep a “frictionless and invisible” border between Northern Ireland and Ireland, at least on its side.
Secretary Davis also stressed a “hard Brexit” scenario is still not impossible – and the UK would “find a way” to manage the possible risks if it has to exit the EU without a trade deal and without paying the divorce bill. This would mean severing economic ties with the EU, and, quite likely, a war of customs tariffs.
He said the UK seeks a comprehensive trade deal, which would provide the absence of customs tariffs, including on the trade in services, and pretty much preserve the status quo trade relationship between Britain and the EU.
While the Tory cabinet said – reflecting the aspirations of the Brexit voters and Conservative voters – it would not pay the divorce bill, the pro-globalist Labour opposition, as well as the Exchequer said the divorce bill should be paid regardless of whether the trade deal is concluded.
Besides, internal friction within the Tory Party remains, and Ulster’s Democratic Unionist Party (DUP) also fears a “hard Brexit” would alienate Northern Ireland from the rest of the UK.
"The Cabinet truce on Brexit after the first phase of the agreement on Friday lasted a matter of hours,” LibDem Brexit spokesman Tom Brake said. "First, [Michael] Gove (one of the leading Tory Brexiteers) hints strongly at a harder Brexit in years to come and now Davis is resuscitating the utterly irresponsible notion of a 'no deal' Brexit to try to avert the coming Tory civil war."
Negotiations between the UK and EU about the transition period will start in January, whilst the trade deal discussions will commence in February or March. The British government thus has some time to come to grips with a properly coordinated position on the matter.