EU Has Bigger Problems to Worry About Than Gridlock Over Brexit
by Ian Wishart(Bloomberg) — When Boris Johnson boasted last year he’d got “Brexit done,” weary European governments were only too happy to go along with it. The last thing they need now is for that sort of distraction to return.
As countries emerge from their coronavirus lockdowns and memories of the U.K. as a European Union member fade fast, the bloc’s political energy is focused firmly on other things. Top of the list: how to tackle the worst recession in living memory.
So there’s little appetite in the EU’s 27 capitals to unpack the trickier issues that were sidestepped in the U.K.’s initial exit agreement. Johnson’s team are also focused on the virus, and his senior adviser Dominic Cummings, who embodies the government’s take-it-or-leave-it negotiating style, is battling to save his job after allegedly breaching lockdown rules.
Negotiations on the future relationship resume next week with neither side expecting significant movement and the risks of a rupture growing.
European diplomats charged with following the issue in Brussels complain that they find it difficult to get their governments to engage on Brexit. EU officials who need to liaise with political masters sometimes meet only a half-hearted response. It’s a far cry from those rollercoaster moments in 2017 and 2018 when Brexit seemed to overshadow everything and threatened to explode into a full-on existential crisis.
Yet there’s still work to be done.
The deal reached with Johnson last year on the terms of the U.K.’s withdrawal said very little about the relationship to come — other than providing a window until the end of 2020 to negotiate the next agreement, while giving Britain the benefits of membership during the same period in order to soften the landing.
With bigger fish to fry, EU governments have outsourced their U.K. problem to the European Commission. Talks have been running since March, though truncated by restrictions on travel, and neither side has shown any willingness to back down from many of their initial positions. Earlier this month, chief negotiator Michel Barnier said he is “not optimistic” of success.
Contingency Plans
Without a deal by Dec. 31, U.K. trade with the EU will face tariffs and quotas for the first time in decades, piling more disruption onto business struggling to survive the lockdown. Both sides have begun to think of contingency preparations.
Privately, officials acknowledge that it’s not uncommon for negotiations to follow this pattern, only for a solution to emerge later. But with time running out, a no-deal outcome is getting more likely.
The scandal enveloping Johnson’s government adds further spice. Cummings was the brains behind the successful Leave campaign in the U.K.’s 2016 Brexit referendum, and he’s seen as an major factor in the U.K.’s uncompromising stance. Two EU officials said the U.K.’s tactics aren’t exactly encouraging their leaders to engage.
Hardly anything has shifted on the most fundamental disagreements since talks began in March.
Stalemate
Britain won’t countenance limits on its regulatory powers which the EU says are necessary to ensure a level playing field for businesses. The bloc wants one big agreement with a single governance structure; the U.K. seeks a simple trade deal with other issues subject to their own arrangements. With so little common ground, in some cases, opposing negotiators have just looked at each other without having anything to say.
Barnier’s room for maneuver is limited by the fact that he takes his orders from the very governments who don’t want to get involved. His basic positions can’t change unless member states give him the nod. Through a combination of distraction and disinclination to bend to the U.K’s whims, currently there is no willingness to do that, diplomats from several EU countries said.
The British side shows no sign of budging either. With Johnson having fulfilled his ambition of taking the U.K. out of the bloc in January, some European officials believe he’s no more interested than European leaders are in getting involved.
It all adds up to stalemate. And while officials once thought a long-hyped leaders’ summit scheduled for June would do some unblocking, Europe’s — and Johnson’s — distractions now make it look more like it’ll be a damp squib, officials said.
Both sides insist a deal is still their favored outcome. Aside from the obvious benefits of tariff-free trade, governments see the advantages in other areas, such as arrangements to fish in British waters and getting U.K. cooperation on law enforcement and security matters.
Also don’t discount the possibility that an EU with other things on its mind might — eventually — be more willing to compromise if it means the Brexit problem goes away, one official said.
But the question is whether the benefits of an agreement would be enough for either side to expend the political energy that might be required to get one at this point. “We remain determined,” Barnier said after the last round of talks. But that commitment isn’t necessarily shared by everyone.
©2020 Bloomberg L.P.