WATCHING the UK’s unfolding Brexit folly for more than four years now with an ever-increasing feeling of dread, given what it will mean for the economy and society, it has seemed that moments of light relief have been lamentably few and far between.
However, one such moment came last week with palpable widespread delight on social media about the tone of a letter from Michel Barnier, the European Union’s chief negotiator in the protracted talks with the UK over the future relationship, to Brexiter Conservative MP Mark Francois.
Mr Francois, chairman of the hard-line, pro-Brexit European Research Group, had written a letter to Mr Barnier entitled “A Missive from a Free Country”, which rehearsed a list of complaints about the EU’s approach regarding the future relationship.
In short, while Mr Barnier’s letter seemed on the face of it to be most courteous and far more measured than the “missive” from Mr Francois and what generally emanates from the ERG, its wording was nevertheless viewed by Remainers as delightfully withering. Whatever Mr Barnier’s intentions, his response to the Tory MP for Rayleigh and Wickford certainly appeared to bring some joy for many amid the Brexit woe. Mr Francois seemed far less enamoured with the response, issuing a retort about “unelected commissioners”.
Mr Barnier wrote in his letter to Mr Francois: “I have over the past years met British politicians representing the entire spectrum of views on Brexit, including members of the European Research Group, which you chair.”
In a paragraph which seems to sum up well the UK’s Brexit folly, its consequences, and perhaps also the continuing efforts of our long-suffering EU neighbours to hold out an olive branch amid the European separatist drive of the arch-Brexiters, Mr Barnier continued: “While nobody has been able to demonstrate to me the added value of leaving the most integrated economic and free trade area in the world, I have always respected the UK’s decision to withdraw from the EU. In this spirit, the EU negotiated the Withdrawal Agreement with your government. In this same spirit, we approach the ongoing negotiations with your great – and indeed free – country, which will remain a close neighbour, friend and ally of the European Union.”
This paragraph of course also gets us to the heart of the grim economic consequences of the UK’s Brexit folly. So Mr Barnier’s letter, while uplifting in its polite robustness and incisive summation of the realities of what is occurring, also underlined the gravity of the situation the UK is facing.
The Conservative Government is determined to leave the European single market. Mr Barnier’s description of this as the “most integrated economic and free trade area in the world” is entirely reasonable.
As a bloc, the EU is by far the biggest destination for UK exports.
Around 43% of UK exports went to EU countries in 2019. The US accounted for around one-fifth of UK exports. Seven of the UK’s 10 largest export markets are EU countries, according to the latest figures. The Brexiters really should sit down somewhere quiet and contemplate those numbers, and reflect on whether the European separation they are pursuing is wise or foolish.
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Many people could, of course, be forgiven for not realising how important the EU is to the UK, given the rhetoric from the Brexiters and the great enthusiasm shown by UK Government ministers, including Secretary of State for International Trade Liz Truss, for a free trade deal with the US. A free trade deal which, even if concluded, would on the UK Government’s own forecasts produce benefits which would be tiny relative to the major losses sustained from leaving the European single market.
The Conservative Government – with its technical Brexit on January 31 and more significantly its pledge to leave the single market on December 31 with or without a trade deal – is choosing to abandon frictionless trade with the bloc which constitutes its most important export market. Plain and simple, although also impossible to fathom from a common-sense perspective.
With the UK Government refusing to extend the transition period beyond December 31 by the deadline of July 1, even amid the massive economic fall-out from the coronavirus crisis, we are now less than six months away from the European single market exit door.
And businesses, which have a mountain to climb in adapting to the consequences of the human tragedy that is the coronavirus pandemic, do not yet know even in broad terms what the future relationship with the UK’s biggest trading partner will look like.
Last week once again saw the differences between the UK and EU in the ongoing negotiations underlined rather than narrowed.
It was the second week of face-to-face talks.
Mr Barnier last week travelled to London for a dinner and talks with David Frost, the former chief executive of the Scotch Whisky Association who is the UK’s chief negotiator in the discussions on the future relationship.
The EU chief negotiator tweeted a picture of himself on the train on the way to London. He appeared to be doing his best to remain upbeat even after months of the talks on the future relationship seeming, certainly from an external standpoint, to have gone round and round in circles.
The EU points out that the UK must accept obligations if it wants the benefits of free trade with the huge bloc.
As Mr Barnier wrote to Mr Francois on the crucial “level playing field” aspect: “If the UK wants to conclude an economic partnership with the EU, fairness and the rules of the game in an unprecedented context of geographic proximity and close economic interconnectedness, based on almost five decades of sharing the same single market, are necessary.”
The UK for its part continues to assert its sovereignty, which was surely never in question anyway during the country’s decades of EU membership.
Mr Barnier declared on Twitter on Tuesday last week: “En route to London United Kingdom: looking forward to continuing discussions w/@DavidGHFrost & team. The European Union wants an agreement – and we are doing everything to succeed – but not at any price. We are engaging constructively & I look forward to equivalent engagement from the UK this week.”
The following morning, he tweeted: “Useful discussion (and nice dinner! fish) with @DavidGHFrost last night. The European Union team will continue negotiating in good faith today. We are working hard for a fair agreement with the United Kingdom, including on fisheries and a level playing field.”
The preambles from the EU appear to have become friendlier in tone even as the talks have remained bogged down.
However, the talks themselves, and statements from both sides following each round, have certainly developed a pattern of predictability.
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Last Thursday, Mr Barnier tweeted: “This week’s discussions confirm that significant divergences remain between the European Union & United Kingdom. We will continue working with patience, respect & determination. Regardless of the outcome, there will be inevitable changes on 1/1/21.”
Unfortunately, there will be “inevitable changes” from the start of next year. These look certain to be major under any scenario.
There will also be significant economic damage, regardless of whether there is a deal or not. Remember, of course, that forecasts drawn up by the Theresa May government showed very significant damage from leaving the European single market under any scenario.
It does not matter that Mr Francois believes “no one has ever demonstrated” to him the “added value of remaining in the EU”, as he intimated in his reaction to Mr Barnier’s response.
The extent of the changes after December 31 will depend on whether there is a deal or not.
It was initially interesting to read recent reports of a supposed spat within the UK Government related to Brexit, based on views communicated by Ms Truss to Minister for the Cabinet Office Michael Gove.
Sadly, on analysing this, it appears the supposed tension cited in the reports, if it existed, was around an issue that seems relatively unimportant in terms of the wider Brexit folly. It appears to centre on technicalities around whether or not the UK would be able to phase in border controls on trade with the EU after the transition period runs out. Of course, some kind of phasing in would surely help mitigate the likely chaos if the UK crashes out of the European single market with no deal, on World Trade Organisation terms, but there are much bigger issues over the longer term.
The negative effects of the loss of the economic benefits of free movement of people and frictionless trade must not be underestimated, and these will be felt over years and decades. This is the crucial point, and it is to be hoped this begins to dawn on the UK Government before too much more time passes and that, even at this late stage, the Conservatives take some action to mitigate rather than exacerbate the damage from the Brexit folly.
Ireland’s foreign affairs minister, Simon Coveney, has this week, flagging “very little progress” in the negotiations and “quite a lot of frustration”, declared that a no-trade-deal Brexit would be an “enormous act of self-harm”.
It would surely be difficult for anyone with even a basic grasp of the realities and economic consequences of the situation to disagree with that statement.
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