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Prime Minister Theresa May yesterday defended the Government’s Brexit plans in the House of Commons, saying, “We are negotiating with the EU on the basis of the Chequers agreement and the White Paper and those discussions have been started this week.”
Elsewhere, giving evidence to the Liaison Committee, May said that she continues to believe “‘no deal’ would be better than a bad deal,” adding, “Some have suggested that we would be prepared to pay ‘any price’ for something, I think that would not be a good deal for the UK.” She noted that the Government is “preparing for all contingencies” and that it will soon publish “around 70” technical notices to “lay out the consequences [of a no deal Brexit]” for businesses and the public. May also acknowledged that the Government’s proposal for a Facilitated Customs Arrangement may not be fully ready by the end of the transition period. She explained, “The majority of what is required for this facilitated customs arrangement will definitely…be in place by December 2020. There is a question as to the speed with which the repayment mechanism would be in place. So far the suggestion is that it could take longer to be put into place. That has yet to be finally determined.”
Meanwhile, May will today visit Northern Ireland and the Irish border, ahead of a speech tomorrow in Belfast where she will emphasise the Government’s commitment to avoiding a hard border on the island of Ireland and protecting the Good Friday Agreement. The Times also reports that the Prime Minister will tour the UK this summer to build support for her White Paper plan.
BBC News The Belfast Telegraph The Times
According to a draft paper seen by the BBC, the European Commission will be warning the EU27 to improve their preparations for a ‘no-deal’ Brexit scenario. The document reportedly states that possible consequences of not reaching a deal include disruption to the aviation industry and UK goods being subject to customs checks at borders. It also warns that each member state and EU institution is responsible to make appropriate arrangements for this scenario, adding that preparations must be stepped up immediately in various areas including borders, transport, data and medicine.
Elsewhere, the Financial Times reports that Brexit Secretary Dominic Raab is set to distrubute around 70 technical documents to businesses and households explaining the implications of a ‘no-deal’ Brexit for various sectors. This comes as Raab will today hold talks with EU chief Brexit negotiator Michel Barnier in Brussels.
Irish Foreign Minister Simon Coveney yesterday said, “What’s being proposed by Britain needs and deserves in-depth consideration and consultation as to whether it is legally possible to accommodate what they are looking for.” But he noted that the recent amendment to the UK Taxation (Cross-Border Trade) Bill, which removes the possibility of a customs border between Northern Ireland and Great Britain, was “unhelpful” and “a distraction,” adding, “People are trying to tie the government’s hands, but amendments and legislation can be changed.” Coveney also suggested that a no deal outcome remains “very, very unlikely,” saying, “It’s very clear that there is not a majority in Westminster in favour of a no deal Brexit.”
This comes as the Irish cabinet yesterday met to step up Brexit contingency planning, including for a no deal situation. Speaking after the meeting, Irish Taoiseach Leo Varadkar said, “President Juncker and my EU colleagues have on many occasions said that they wouldn’t require us to put in place a physical infrastructure and customs checks on the Border between Northern Ireland and Ireland.” Varadkar also warned the UK, “If there was a no-deal, hard Brexit next March the planes would not fly and Britain would be an island in many ways and that is something that they need to think about.”
Elsewhere, The Guardian reports an EU member state diplomat who said, “What the UK has proposed is unacceptable. We have had no progress on the issue. It is good that the UK has tabled the white paper but that is not what we are talking about at the moment. The Withdrawal Agreement and Irish protocol in it comes first.” The Financial Times also reports that the EU are revising some provisions in their Irish backstop proposal to make it less incendiary and stress that checks would be technical and administrative.
The Irish Times
The Irish Times
Giving his resignation speech yesterday in the House of Commons, former Foreign Secretary Boris Johnson accused the government of “dithering” in Brexit negotiations, and urged them to “again aim explicitly for that glorious vision of Lancaster House – a strong, independent self-governing Britain that is genuinely open to the world, not the miserable permanent limbo of Chequers.” He argued that the Chequers proposal for a common rulebook in goods meant “volunteering for economic vassalage,” and that, coupled with the government’s Facilitated Customs Arrangement plan, it would leave “much less scope to do free trade deals.” He also warned, “It is absolute nonsense to imagine, as I fear some of my colleagues do, that we can somehow afford to make a botched treaty now, and then break and reset the bone later on. Because we have seen, even in these talks, how the supposedly provisional becomes eternal.”
In a speech in London yesterday, International Trade Secretary Liam Fox said, “We have made an offer to the EU27. The ball is now in their court.” He added, “We think that’s a fair and reasonable deal and they have to understand what no deal might mean as a consequence to their economies,” warning that it “might mean reductions in GDP of something like 4 percent for the Netherlands, 3.5 percent for Belgium and 7 percent or 8 percent for Ireland.” Fox also announced the launch of four new public consultations on future free trade deals with the US, Australia, New Zealand and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Speaking on possibility of a UK-US deal after Brexit, he said, “When we leave the EU, if it is under that Chequers agreement, we have absolute freedom to change those manufacturing tariffs and that, at the moment, is one of the key focuses that the US has.”
Elsewhere, giving evidence to the European Scrutiny Committee yesterday, Environment Secretary Michael Gove said, “I’ve been clear that in any trade agreement we secure with America or any other country, we shouldn’t see a dilution of [animal welfare and environmental] standards. Some have said that means it would be impossible to secure a free trade agreement, but I think they are falling prey to the temptation to make the perfect the enemy of the good.” He added, “I’m sure that agreement can be found in a whole range of areas.”
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Press Association II
European Commission President Jean-Claude Juncker yesterday announced that the EU had “reacted to unilateral [tariff] measures taken by the US administration,” and would also in the future “give tit-for-tat to any provocation that might be thrown to us.” This comes as Juncker is set to meet US President Donald Trump in Washington DC on 25 July. Juncker criticised US attempts to divide the EU over trade, saying, “The EU single market is indivisible and the Commission is in charge of the articulation of the EU trade policy… Any efforts to divide the Europeans are in vain.”
Meanwhile, today EU provisional safeguards to US punitive tariffs on steel and aluminium enter into force. EU Trade Commissioner Cecilia Malmstrom said these are necessary “to protect our domestic industry,” adding, “These measures will address the diversion of steel from other countries to the EU market as a result of the recently imposed US tariffs.”
The EU yesterday imposed a €4.3bn antitrust fine on Google for using its Android operating system to favour its own search engine, and gave the company a 90-day limit to stop these “illegal practices.” EU Competition Commissioner Margrethe Vestager said the size of the fine was justified since Google’s “turnover has developed a lot” since it started this “very serious illegal behaviour” in 2011, adding, “Google has used Android as a vehicle to cement the dominance of its search engine… to ensure that traffic on Android devices goes to the Google search engine… These practices have denied rivals the chance to innovate and compete on the merits.” Google has announced it will challenge the fine at the EU court.
The Hanseatic League, a loose group of eight economically liberal EU member states, called on the EU to “redouble” efforts to create a Capital Markets Union. In a letter seen by the Financial Times, the group demands that policymakers “target and prioritise” those measures than can still realistically be achieved before the European Elections in May 2019 and “which enjoy broad support among member states,” citing improved regulatory rules for investment banks and brokerages or bolstering of the fintech sector as examples. Achieving this has become “all the more important” due to Brexit, the group stressed, as the exit of Europe’s biggest financial centre from the bloc could have negative effects on companies in need of capital.
The President of the European Investment Bank (EIB), Werner Hoyer, yesterday raised doubts over the bank’s ability to support the Iran nuclear deal alive by helping to finance EU-Iran trade. Hoyer said Iran was a country “where we cannot play an active role,” and warned that any such involvement “would risk the business model of the bank,” adding, “There is no European bank which is presently able to do business in and with Iran.”