11 May 2017

Labour pledges to reject a ‘no deal’ outcome on Brexit

According to a leaked draft of the Labour manifesto, the Labour party will reject a ‘no deal’ outcome on Brexit. Labour also pledges to scrap the Conservative’s white paper on Brexit and “replace it with fresh negotiating priorities that have a strong emphasis on retaining the benefits of the single market and the customs union,”  whilst also promising to immediately guarantee existing rights for all EU nationals living in Britain. This comes after Labour leader Jeremy Corbyn earlier this week failed to categorically confirm that Britain would leave the EU under a Labour government, regardless of the deal negotiated.

Source: The Guardian

Schulz calls for a joint budget of the Eurozone

In an interview with the German newspaper Die Zeit, SPD’s candidate for the German Chancellery, Martin Schulz said, “When the states of the Eurogroup have to deal with common tasks, it would be reasonable to have a common budget.” He also warned, “Whoever doesn’t want the isolationist policy of the USA, and whoever doesn’t want Brexit to win” would have to support further Eurozone integration.

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Bundesbank won’t actively try to attract financial firms to Frankfurt after Brexit, senior official suggests

Andreas Dombret, a board member of Germany’s Bundesbank, told Politico that the institution will not try to attract UK-based banks to Frankfurt in the wake of Brexit, suggesting the stability of the banking sector was of greater importance. He said, “You will not see us with a marketing prospectus, we will not be calling banks, we will not be giving discounts or goodies, we will not allow shell companies.” He went on to argue, “I am enough of a European that to me, the issue of which city hosts [the relocating banks] is of secondary nature. I herewith promise to call my colleague, the head of supervision of that country, and offer him or her resources of the Bundesbank, because it is in everybody’s interests that we don’t have a cliff-edge effect.”

On the future of clearing of euro-denominated transactions, Dombret said, “We do not know in which direction the UK might change their current rules after Brexit…All clearing houses are in principle able to absorb capacity, but I expect that market participants are watching this very closely. And it is an important issue, because there are very big amounts at stake. So what we need to prevent are cliff-edge effects.”

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Barclays boss calls Brexit "a wholly manageable challenge" for the bank

Barclays chief executive, Jes Staley, said Brexit would be “a wholly manageable challenge” and “significantly less costly” than other problems the bank has faced. Staley told Barclays’ shareholders at their annual meeting that retaining the single market for financial services remained the best option for the UK and EU. Staley continued, “Finally, we do not currently see a need in our options to shift British jobs or significant operations elsewhere. If we require a buildup of capability in another European Union jurisdiction as part of our plans then we can do so, and we will.”

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UK shipping chief warns against scrapping UK-France border agreement

The CEO of the UK Chamber of Shipping, Guy Platten, has warned against scrapping the Le Touquet border agreement between France and the UK. This follows calls from French President-elect Emmanuel Macron to renegotiate the deal. Platten said, “All you will do [in scrapping the Le Touquet treaty] is cause two lots of checks to be carried out, and massive delays. I can’t see any upside.” He added, “It seems to be that [for Macron] it’s a very nice election slogan, but it’s impractical…It’s not going to achieve anything but increased delays.” Prime Minister Theresa May has previously stated her intention to stress to Macron that the deal “works for the benefit of both the UK and France.”

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Transitional Brexit deal ‘critical’ to UK operation, says president of Ford

According to Jim Farley, Ford president for Europe, the future of the carmaker’s UK operation will depend on whether the UK secures a transitional agreement with the EU if a free trade agreement is not concluded within the negotiating period. Speaking at the Financial Times’ Future of the Car conference, he said, “We really believe in a transitional period…This should happen if the details aren’t hammered out in time before Brexit. It’s critical for the future of our investments in the UK.” He said he expected “a very ambitious agreement” to be concluded.

Separately, the think tank Chatham House has published a report arguing that transitional arrangements would be important for the UK energy sector. It stated that if no free trade deal is agreed, then “the government should seek to maintain its current status within the internal energy market and the EU’s Emissions Trading System during the transition process.”

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UK venture capital funds losing EU investment

According to the Financial Times, investments from the European Investment Fund (EIF) in UK-based venture capital funds have decreased since the triggering of Article 50. Michael Collins, Chief Executive of Invest Europe, the representative body of Europe’s venture capital sector, said, “Before, it was business as usual for UK fund managers and UK-based funds. Since [Article 50 was triggered], we are hearing that such managers are being told that it will be much more difficult for them to secure EIF investment.” The EIF said, “There is no moratorium on lending to UK projects. It is the case that due diligence on them now needs to be more thorough, and take into account a wider range of factors.” The UK venture capital sector currently receives more than a third of its investments from the EIF.

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Government says the most “unpopular” parts of the Common Fisheries Policy will be removed post-Brexit

In a letter to the Scottish Fishermen’s Federation (SFF), Environment Secretary Andrea Leadsom said, “It is essential that we take the opportunity [of Brexit] to develop a fisheries regime that is better-suited to our seas and industries.” She added that, as the UK leaves the EU, “We will look to disapply the key elements of the CFP [Common Fisheries Policy] that are most unpopular and unworkable for the UK as a coastal state,” but “no decision has yet been made” on what extent the CFP will be incorporated into British law. Scottish First Minister Nicola Sturgeon responded to the letter saying, “As Scottish Tories tell fishermen Brexit means no CFP, [this] letter says [the] UK government [is] considering incorporating CFP rules into domestic law.” SFF chief executive Bertie Armstrong said, “Any reading of this letter in full makes it clear that the UK government is committed to ensuring we exit the CFP and reassert control of our waters. In fact, at our meeting with Ms Leadsom in March, she said that we are leaving the EU and we are leaving the CFP.”

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