Brussels Sees Real Brexit Talks at Last — and Real Dangers
Posted August 15, 2018 5:30 p.m. EDT
BRUSSELS — From the start of the torturous negotiations over Brexit, as Britain’s exit from the European Union is known, the talks have followed an all too familiar dynamic.
The Europeans set the agenda; the British push for concessions or special deals, while trying to work out among themselves what they really want. The Europeans say no, sticking to a pretty hard line.
But now, with 85 percent of a deal completed, and the toughest issues remaining, European officials say they are increasingly worried that Prime Minister Theresa May’s government is so divided and fragile that it could collapse, scuttling a deal and inflicting damage on the Continental economy.
So the Europeans are now exploring ways to finesse their position, three senior European officials say, to sign a withdrawal agreement by the end of the year so it can be ratified by the end of March, when Brexit occurs regardless.
That would formally divorce Britain from the bloc after more than 40 years of marriage. But some of the hardest issues would be left for transition talks that will last another 19 months, until the end of 2020.
All of the officials spoke anonymously, following diplomatic practice, and because they do not have permission to be quoted by name.
Big issues remain to be resolved, with the Irish border chief among them. So the Europeans say they may agree to fuzzy language in the withdrawal agreement’s political declaration — along the lines of “aiming to negotiate the closest possible partnership.”
The aim is to reduce internal British political warfare over how to best keep the promise of no hard border between Ireland, which will remain in the European Union, and Northern Ireland, which will not.
The new British Foreign Secretary, Jeremy Hunt, has been traveling through northern Europe, lobbying for Britain’s position, warning of a chaotic no deal Brexit, and urging “a change in approach” by Brussels. The British and EU negotiators will meet again Thursday and Friday, an unusual mid-vacation session.
A big sticking point is how to oversee disputes between Britain and the bloc, since May, pushed by fervent Brexiteers, does not want to give the European Court of Justice, the bloc’s highest court, any authority over Britain once it leaves the European Union.
But the thorniest issue is the nature of the border between Ireland and Northern Ireland, because its status hinges on some understanding of the future trading relationship between Britain and the bloc, which remains up in the air.
May, at her meeting with her Cabinet at Chequers in July, supported the concept of a “free trade area for goods” — but not services — made possible by what she called a “facilitated customs arrangement.”
European officials said the Chequers statement at least clarified for the first time what Britain wants, even if they rejected her customs proposal out of hand.
What was objectionable, they say, is that Britain talks of wanting an “economic partnership” with the bloc that is akin to being part of the single market for goods alone.
The Europeans have been clear that Britain cannot keep what it had as a member without the obligations of membership, in particular the free movement of goods, as well as capital, services and labor.
Nor can it be in a formal customs union if it wishes to make its own trading deals, as May continues to insist.
Britain has failed to understand, the Europeans say, how much the European Union itself feels threatened by the world since the Brexit referendum — by the challenges of President Donald Trump, Russia and China, as well as the rise of authoritarian leaders in Hungary and Poland and populists in general who are largely anti-Brussels, as are those in Italy.
So there is even less willingness now to compromise on key EU principles, and a desire, especially from France, to make it clear that membership in the bloc has privileges not shared by other countries.
There is also a growing weariness with Britain and May, who seems to be arguing that she is politically so weak that she cannot talk honestly with her own citizens about what Brexit actually means.
“The UK is looking at this from the angle of the future relationship,” a senior European official said. “The other 27 are looking at this as an attack on what the EU is.”
“We regret the loss of the UK, which is a cost for everyone,” the official added. “But it would be even worse if this is the occasion for compromising on the core of the EU — that’s to say, the single market.”
That understanding finally seems to be coming home to the British, the Europeans feel, but they are reluctant to specify the consequences, for fear of hurting May and creating a new political crisis in Britain that would throw the whole Brexit process into chaos.
So the Europeans are discussing vague language about a future relationship, hoping that will be enough to make Britain accept the need for no hard or visible border on the island of Ireland.
“The aim,” a second European official said, “is to make what seems unacceptable merely unpalatable.”
European officials are also searching for compromise. If a formal customs union is impossible, European officials say one solution might be a future free-trade agreement with the EU, much as Canada and Japan now have, but one that could allow the unencumbered movement of goods across the British (and Irish) borders.
But there is no guarantee that such a free-trade deal will be quick or easy. Normally such agreements take years to negotiate.
There is also discussion of limiting the jurisdiction of the European Court of Justice and EU customs officials over Northern Ireland as part of the “backstop” deal, which Ireland (with the support of Brussels) has insisted be written into the withdrawal agreement.
If Britain and Brussels cannot work out their future trading relationship in time, the backstop would essentially establish a border between the entire island of Ireland and the rest of Britain for customs, regulatory standards and value-added tax.
Given the difficulties, some in Britain have been forecasting no deal at all, a cliff-edge Brexit. But senior European officials think that a deal is still more likely than not, if both sides are “reasonable.”
They also say they would be willing to extend the “transition” period to negotiate a new relationship with Britain past December 2020, its current end date. But a specific clause to that effect, with a time limit, must be included in the withdrawal agreement. The problem for Britain is that any extension would mean additional payments into the EU budget and a continuation of “rule taking” without a vote, which would outrage Brexiteers.
What many European officials fear is less a cliff-edge Brexit next March than one at the end of 2020, if a final free-trade deal is not completed.
To negotiate a special free-trade deal with Britain that avoids a hard border in Ireland, plus a possible second agreement on security, would ordinarily take years.
But the Brexit withdrawal agreement comes first, and the remaining issues are difficult.
At least now though, European officials say, the talks, at long last, can get more serious.