Newington and Cambre examine Theresa May's approach to Brexit negotiations, and the response from the EU.
Latest twist in the plot
UK perspective
Less than one month into 2017 and already Brexit developments have been coming thick and fast. Clues to the direction and style of the UK's negotiating position were provided in Theresa May's first major speech on Brexit, where she ruled out ongoing membership of the single market and set out a vision of a great global trading nation with old friends and new allies. Whilst stating she had no intention to “undermine” the EU, she argued that any attempt to “punish” the UK would be “an act of calamitous self-harm”. Meanwhile the Chancellor, Philip Hammond, hinted that should the UK be refused access to the European market the Government would be prepared to transform its economy to regain competitiveness. Finally, the Government lost its Supreme Court battle over Brexit, meaning Parliament must vote on triggering Article 50.
EU perspective
Most EU stakeholders reacted with raised eyebrows at Theresa May "plan" for Brexit. Although given in most quarters a diplomatic welcome, the specch was broadly seen as vague and dismissive of reality – if not delusional, contradictory and threatening. Coming soon after Ambassador Ivan Rogers' resignation and accusations of "muddled thinking" in London, the speech was seen as another sign that the UK government lacks not only a coherent plan but also a clear understanding of EU law and structures (e.g. the difference between the Single Market and an FTA). The message was that the EU was "not hostile" towards the UK, but continued to await the triggering of Article 50 and a clear negotiating position from London, while warning that refusal to "play by the rules" would not be tolerated. A few days later in Davos, May received a frosty reception, with her speech being termed "propaganda" and her vision of a prosperous free trading UK outside the EU incoherent.
The best of times and the worst of times
UK perspective
As the dust settled following the Prime Minister's speech, those opposed to leaving the single market warned of the bumpy road ahead. The CBI said the UK risks a 'disorderly crash landing' if the Government walks away from Brexit negotiations and opts for 'no deal' under WTO rules. And whilst May has pledged to keep the devolved administrations fully engaged in the Brexit negotiations, this week the Supreme Court ruled that the Government does not need the consent of Scotland, Wales and Northern Ireland before triggering Brexit.
EU perspective
For the EU, a hard Brexit is not good news, and there is a widespread perception that a "lose-lose" situation is on the cards, at least in economic terms. As Juncker recalled following May's speech: “A fair deal with Britain means a fair deal for the EU too”. Meanwhile, Scotland continues to keep a high profile and elicit sympathy in Brussels - although a Catalonian "resurgence" is complicating Edinburgh's campaign.
Allegiances and betrayals
UK perspective
Meanwhile the UK Government has been making feverish preparations to set the ball rolling on bilateral trade deals which would kick in once the UK leaves the EU. Despite risking the wrath of the EU which insists the UK is prohibited from signing deals until it has left, 'preparatory' talks were announced by the Australian Treasurer and are likely to be a central theme of May's visit to Washington this Friday.
EU perspective
Until Article 50 is triggered though, the EU is basically just sitting back and watching the show. May's visit to Washington will be closely scrutinised, less for any impact on Brexit than for clues on how to deal with Trump. The reaction to UK overtures towards Australia has been low key, with the Commission clarifying that: “There is nothing in the treaties that prohibits you from discussing trade,” but “you can only negotiate a trade agreement after you leave the European Union.”
What does the next chapter have in store?
UK perspective
Following the Supreme Court ruling, the Government are likely to act quickly to table a Bill in Parliament to trigger Article 50. Whilst Government defeat is unlikely, Labour is highly divided on this issue and as such the main opposition is likely to come from the SNP.
EU perspective
When this might be possible remains the key question. For the EU, the key thing is that the UK should respect the agreed timeline. A delay in triggering Article 50 will not be welcome. Expect more on the EU's position from the 3 February "informal" EU27 leaders Summit in Valetta.
….and the most memorable quote?
UK perspective
"no deal for Britain is better than a bad deal for Britain" Theresa May
EU perspective
“We want a fair deal for the UK but that deal necessarily needs to be inferior to membership. Thinking it can be otherwise would indicate a detachment from reality” – Maltese PM and EU Council President Muscat
