Explaining the Brexit negotiation impasse3
September 4, 2017 by Paul Goldsmith
You would be forgiven for thinking there is an impregnable impasse in the negotiations between Britain and the EU over Brexit. That would be true if you consider this a two year process. It it is important to remember that the writers of Article 50 of the Lisbon Treaty, under which Brexit is taking place, wrote a deliberately vague section that was never intended to be used, and if it were followed slavishly would put such power into the hands of the EU it would be impossible to actually negotiate anything. That two year timescale is, essentially, arbitrary, and should be considered so by both sides if they are seeing to be sensible.
Of course, at the moment both sides are not seeking to be sensible. The papers published by the Department for Exiting the EU are, in the words of EU Chief Negotiator Michel Barnier, nostalgic for the benefits of the EU without any of the obligations. Britain is still labouring under the expectation that a few car makers in Germany, Prosecco makers in Italy and cheese makers in France will force the EU to complete a free trade deal with the UK pronto. The EU, however, who has never succeeded in agreeing a trade deal with even one of its top five trading partners, are insisting that what they call ‘sufficient progress’ is made on an exit bill, EU citizens’ rights and Northern Ireland BEFORE any talk about a trade deal going forward takes place.
It is difficult to define what ‘sufficient progress’ actually means. That is because the exit bill depends on the level of engagement with EU institutions and what sort of trade deal Britain will have going forward. Then, EU citizens rights depends on agreement on judiciary oversight going forward (there isn’t a single independent country which has citizens with rights decided by a foreign court so why should an independent UK submit to that). Finally, the agreement on the one land border Britain has with the EU, between Northern Ireland and Republic of Ireland, depends on the Customs agreement achieved between the UK and the EU (free movement is not an issue here as there is a ‘Common Travel Area’ between the UK and Ireland that has been in place since the 1920s).
I think a bigger problem for the UK negotiating team is who there are negotiating with. Some argue that Michel Barnier represents the institution of the EU, which means that he and his negotiating team are not democratically accountable to anybody for the deal that they strike with the UK apart from the institution of the EU itself. So all Barnier represents is a determination by an undemocratic institution to punish the UK for democratically choosing to leave it. Others have argued that Barnier’s negotiation strategy was signed off by the 27 members of the European Council. Therefore he has no choice but to implement what they have agreed. More complicatedly, Barnier cannot concede much unless those 27 countries agree he can. They next meet officially in October. This, by the way, is why the EU haven’t concluded a trade deal with their five largest trading partners. It is hard to do if you work like it does.
Remainers are opportunistically pointing out that Leave campaigners said during the EU Referendum campaign that striking a deal with the EU would be easy as they wouldn’t want to lose the money that comes their way due to our trade deficit with them. Leavers point out that Remainers appearing to be cheering on an institution that wants to punish their country for a democractic decision. Neither approach is helpful.
In the end the answer is going to be to understand that this can’t be a two year process. We are going to need a transition period long enough to achieve the deal we want (which we do need to articulate better than we are) without succumbing to the ‘cliff-edge’ of an articifically imposed time limit. To achieve that, we may need to do what every good negotiator knows, which is to articulate a realistic walk away position that doesn’t account to the whistling in the wind that is happening now. It is hard to see what that walk away position is, but we need one. Soon.
Great post – interesting and fair to both sides, I think. I particularly agree on the notion of complexity to negotiate with the EU (and corresponding lack of break-through agreements for the EU). But I was wondering whether you have any explanation for the (common) notion that the UK would benefit from negotiating directly with EU nations and from a splintering of the apparent unity, the EU nations have displayed so far? It would appear to me that such a situation would be far worse for the UK (of course only if they are interested in achieving an agreement) – it may be difficult to negotiate with a unified EU, but at least it is possible to negotiate with such an entity. A divided EU would never be able to agree to anything?
The notion is based on the possibility that some countries (Poland, Slovakia for example) would suffer greatly from a hard Brexit and would thus put pressure on the central institution to try to avoid that. The truth is that the EU can’t make big trade deals because getting all 27 countries to ratify something is hard. Apparently this deal would have to be ratified by Spain who would surely attach an amendment to do with Gibraltar as they will not get a better chance to achieve something there. Splitting the unity of the EU nations is a risky strategy but it is based on the belief that 27 countries might have different interests (I know, radical, right?). Whether it would work is a different story
The United Kingdom needs to look towards the West. A customs union with Canada or the United States should be prioritised above a trade agreement with the European Union and achieving it would be easier and possibly more beneficial than an agreement with the EU. The EU will also be motivated to come to an agreement if it is demonstrated that there is a very real possibility that the UK is about to shift the balance of economic might dramatically Westwards.
It will be much easier to reach an agreement with Canada, which is part of the Common Wealth, and the United States, with President Trump having been strongly in support of Brexit, than it will be with 27 member states of the EU, all of which want something different as a payoff.