20 October 2017

Theresa May calls for Brexit deal she can “defend”

UK Prime Minister Theresa May yesterday urged EU leaders to create a “dynamic” in Brexit negotiations that “enables us to move forward together.” At a working dinner in Brussels, May told EU leaders that “firm progress” had been made, and “we must work together to get to an outcome that we can stand behind and defend to our people”. She called for “urgency” in reaching an agreement on citizens’ rights in the Brexit negotiations. Speaking to reporters at the European Council summit yesterday, she said EU leaders will be “looking at the concrete progress that has been made in our exit negotiations.” She also said she intends to show to the Council how the UK will continue “playing a full role” in matters of European defence and security.

Following the meeting, there have been more specific revelations about what was discussed between the Prime Minister and her EU counterparts. According to the BBC, the Prime Minister “apparently told EU leaders Florence was not the last word on the Brexit bill.” Also, The Times reports that May has “discussed what Britain was prepared to pay the EU to secure the start of trade talks.” He adds, “It is understood she has indicated Britain is prepared to pay future liabilities amounting to an additional €20bn, which would be acceptable to most EU governments.”

Elsewhere, arriving at the European Council summit, German Chancellor Angela Merkel said, “From where we are now, [progress] is not sufficient enough to enter the second phase, but it is encouraging to move on with the work so that we can reach the second phase in December.” She stressed that she wants to continue the negotiations “in good spirit and at the same time taking into account and respecting the wish of the British people to leave the EU but also maintaining a good relationship between Great Britain and the EU.”  Later the same evening, Merkel said, “Actually I don’t have any doubts whatsoever [that the UK and EU can reach a deal], if we all have clear minds”, adding she saw “zero indices that this is unrealistic”. It was important how the EU formulates its new mandate for the negotiations, Merkel said, “Therefore the ball is not only in the UK’s court, but equally with us.” The EU as well as the UK would have to decide “what actually our answer is to a incomplete adherence with the freedoms of the single market”. French President Emmanuel Macron emphasised the “very strong unity” of the EU27 in Brexit discussions, adding, “We are all united on our assessment, interests and ambitions, with one shared negotiator – Michel Barnier.”

Also arriving at the summit, Irish Taoiseach Leo Varadkar warned that the EU and UK must not “sleepwalk towards a cliff edge” on Brexit and that “substantially more progress” should be made in the next couple of months. He called on the UK to provide “a lot more detail” on how it proposes to deal with the Irish border issue post-Brexit adding, “It’s not enough to say you don’t want a hard border,” and that it’s the UK’s responsibility to “put forward detailed proposals as to how we can ensure things remain much the same.” On the customs union he argued, “I find it difficult to square the circle of having a customs partnership which is very like the customs union we have now but at the same time Britain engaging in trade deals with third parties.” In addition, the Taoiseach predicted that “it’s very likely that the majority of people in Northern Ireland will be Irish and European citizens” post-Brexit, and said that EU leaders were beginning to understand Northern Ireland’s peculiar status as “a territory that is going to be outside the European Union in which the majority of citizens are EU citizens, and the majority of which at least voted to stay in the EU”.

Meanwhile, Dutch Prime Minister Mark Rutte said failure to reach sufficient progress was “primarily” a question of money, adding, “Theresa May has to come up with more clarity on what she meant [by] “other commitments” in her Florence speech.”

Separately, Open Europe’s chairman Simon Wolfson appeared on Question Time last night. He appealed for calm in the coverage of the negotiations, saying “I think we’ve got to be very careful not to have a national meltdown every time we hit an impasse”.

Source: Consilium: Macron Consilium: Rutte Bloomberg Irish Times Politico Brussels Playbook BBC

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David Davis prepares plans for 'no deal' Brexit

The Times reports today that Brexit Secretary David Davis is to present an “upbeat assessment” of a scenario in which the UK leaves the EU without a deal. According to the paper, Davis has ordered officials to step up preparations for a ‘no deal’ situation, and will outline the positives of the scenario in a presentation to Cabinet colleagues at the end of October.


Goldman Sachs chief executive says he’ll be “spending a lot more time” in Frankfurt

Upon returning from a trip to Frankfurt on Thursday, Goldman Sachs chief executive Lloyd Blankfein said in a tweet that he plans to spend a lot more time in the city. This comes as the bank continues to press ahead with plans to increase its staff presence in Germany’s leading financial hub following the UK’s decision to leave the EU as it needs to ensure continued and unlimited access to the single market.

In response to the tweet, a spokesman for the Prime Minister said, “We’re not going to comment on each individual statement but let’s be clear, London is and will remain the world’s leading financial centre.” The government spokesman added, “We have the breadth of talent, legal system, regulation and deep pools of capital that are simply unrivalled by centres anywhere else in Europe, and we are confident of securing an ambitious economic partnership with the EU that will include financial services.”


Jeremy Corbyn addresses EU leaders in Brussels

Jeremy Corbyn, leader of the UK Labour Party, spoke yesterday to the Progressive Alliance of Socialists and Democrats, a centre-left faction in the European Parliament, in Brussels. Corbyn called on both the EU and the UK to stop “insults [and] divisive posturing”, adding, “The British Labour party does not see anyone in Europe as an enemy. We see people across Europe as friends. You are our colleagues, our partners, our comrades and our friends.”

Corbyn, who will also meet EU Brexit negotiator Michel Barnier and President of the European Parliament Antonio Tajani, assured his audience that Labour “will resist any attempt by the British Conservatives to use Brexit to try to create any kind of deregulated tax haven off the shores of Europe”, adding that both sides need “a deal that works for all of us.”


German Chancellor Merkel urges EU to cut accession funds to Turkey

Angela Merkel urged her fellow European leaders today to cut the €4.5 billion in European Union funding to Turkey, which are linked to Ankara’s bid to join the bloc. The German Chancellor raised her concerns about Turkey’s slide towards authoritarianism, saying “The rule of law in Turkey is moving in the wrong direction… We are very concerned about this. I will push for the pre-accession funds to be reduced”. However, Merkel stopped short of calling for an outright end to Turkey’s decade-long bid to join the EU, and also praised the country for doing “a great job” by taking in Syrian refugees. Merkel’s comments on refugees come as AFP reports that refugees are still coming to the Greek islands, despite the EU-Turkey deal to stem the arrival of refugees from Turkish territory.

Separately, the EU is also expected to reiterate its commitment to uphold the Iranian nuclear agreement, a week after US President Donald Trump threatened to unilaterally withdraw from the deal. Europe is expected to argue that Iran is in full compliance with the 2015 pact, and that maintaining the deal is in the interests of global security. EU leaders will also reiterate their calls for North Korea “to abandon its nuclear and ballistic missile programs in a complete, verifiable and irreversible manner.”


European Parliament and Council divided over future of refugee relocation

The European Parliament’s civil liberties committee yesterday agreed on a proposal that would impose a “permanent and automatic relocation mechanism [for refugees] without thresholds” on EU member states while punishing non-compliance with withdrawal of EU funding. The quotas would be calculated based on GDP and population size, with accepted asylum seekers offered the right to co-decide their country of reception. The proposal further removes the current “Dublin rule” that forces asylum seekers to remain in their country of first entry. This comes after an earlier refugee allocation scheme started in 2015 expired last month, having failed to reach its target of 120,000 relocations due to significant opposition by a group of member states including Hungary and Poland. The new proposal will be put to a general vote in the European Parliament, before it proceeds to the European Council, where it would be subject to a qualified majority vote.

Earlier yesterday, President of the European Council Donald Tusk said, “I don’t see any special future for this project [of quotas], but it’s important to find an understanding that does not separate Poland and other Visegrad group countries from the rest of Europe”. Poland’s EU Affairs Minister, Konrad Szymanski, yesterday commented that the quotas agreed in 2015 “were never alive in the first place” and have “no helped anyone, not a single group of refugees, nor any of those countries who still face an unequal burden today.” The Council will discuss solutions to the ongoing migration crisis today.


Madrid ready to trigger Article 155 and suspend Catalan autonomy

Yesterday, the Spanish government announced that an extraordinary Council of Ministers will take place this Saturday. The cabinet will discuss the detailed measures to be implemented under Article 155 and will then communicate its decision to the Senate, who will have to approve it by absolute majority. The Spanish government’s decision comes after the Catalan leader Carles Puigdemont had, according to Madrid, failed earlier in the day to satisfactorily clarify whether the Catalan parliament had declared independence. Puigdemont had reinstated that the declaration of independence is currently suspended and stressed in a letter to the Spanish Prime Minister Mariono Rajoy that “if the central government persists in preventing dialogue and continuing repression, the Catalan Parliament will be able to proceed, if deemed appropriate, to vote the formal declaration of independence, which was not voted on 10th October.”


Germany should support Macron’s “bold and promising” vision for the future of the EU, says German foreign minister

In an opinion piece for Le Monde, German foreign affairs minister, Sigmar Gabriel, writes, “[French president] Emmanuel Macron has given Europe a bold and promising vision. The moment has come for Germany not just verbally to show itself open to his propositions, but to translate words into actions.” He added, “Germany’s contribution to the debate on the future of Europe should not limit itself to a monetary union, nor conform itself to the beliefs that have until now, determined German European policy on financial matters. Otherwise, it is a weak Europe that awaits us.” He suggested plans to “reinforce” the European Stability Mechanism by establishing a European monetary fund was “a good approach” but “[lacked] democratic legitimacy.” He added, “We should discuss proposals to create a Eurozone budget and a European finance minister, instead of straightaway dismissing them.”


Swedish government asks National Board of Trade to prepare for Brexit trade talks

The Swedish government has instructed the country’s National Board of Trade to “develop an in depth knowledge base on Swedish trade interests for forthcoming Brexit negotiations.” Swedish EU affairs minister Ann Linde spoke to Dagens Nyheter, saying, “Brexit is a threat against Swedish exports – Swedish goods could become too expensive to sell in the UK [if there is no deal]. Therefore the government wants the National Board of Trade to prepare Swedish priorities for an eventual trade deal.” She added. “It should be seen as a signal that we have not given up hope that there will be a deal.”


Open Europe held event on future UK-EU relations in Brussels

Open Europe hosted a panel debate in Brussels on the possible models for the UK after Brexit, with speakers defending the Swiss, Norwegian and Canadian alternatives. At the event, British MEP David Campbell Bannerman said that the EU-Canada deal CETA should be the “template” for the long term arrangement between the United Kingdom and the European Union, stating that CETA is the “gold standard of trade agreements”. Also noting that the deal eliminates 99 per cent of tariffs on goods between the EU and Canada, although this figure drops to 92 per cent for agricultural products and its services provisions are much weaker.  He recalled New Zealand officials had told him they are basing “80 per cent” of their potential trade deal with the EU on CETA, showing that it is a good model for Britain to follow.

Swiss business executive and former EU representative of the Swiss Cantons, Hannes Boner, dismissed the so-called “guillotine clause” in the relationship between Switzerland and the EU, saying it was not a “Swiss trap” as some have described it because “this guillotine clause whereby everything is linked to everything only relates to the first package of deals and the Dublin arrangement”. He also pointed out that the Swiss model “relies heavily on decentralization in order to prosper, both internally and globally”, and that “the European Union should not view decentralization as a threat to European Union unity” but as a way to provide stability.

When discussing Norway’s situation, former EFTA official and Norwegian consultant Paal Frisvold pointed out that “the greatest benefit of the Norwegian model is that it provides EU market access for free. Norway does not have to pay for EU institutions and only pays for scientific programmes such as Horizon 2020 and so on”. He doubted whether this would be acceptable in the UK in the long run but thought it could be updated to “mend the democratic deficit”.

Open Europe Director Henry Newman said that “most people in the UK haven’t actually changed their mind since the referendum, if one looks at polls”, further  expressing his surprise that “there has been relatively little analysis on the Continent as to why the UK voted to leave the Union.”

The event was covered by the Daily Express.