6 September 2018

Irish Minister: UK Chequers proposal and May government “are the best prospect of getting a deal”

Irish Agriculture Minister Michael Creed has told The Irish Times he believes the UK government’s Chequers proposal for the future UK-EU relationship is “our best chance of getting [a Brexit] agreement if you look at the alternatives.” He added, “It certainly has its flaws and they will be unpicked in the negotiations, but I think both the Chequers document and Theresa May and her cabinet are the best prospect of getting a deal.”

This comes amid claims that the EU’s chief Brexit negotiator, Michel Barnier, reportedly told the House of Commons Exiting the EU committee this week that the Chequers proposals were “dead.” Labour MP Stephen Kinnock, who sits on the committee, also said, “Mr. Barnier made it crystal clear that Chequers is completely unacceptable to the European Union.” Brexit Secretary Dominic Raab will today meet Michel Barnier in Brussels to resume negotiations on the Withdrawal Agreement and the future relationship.

Separately, Bloomberg reports that the German government would accept a less detailed declaration on the future UK-EU trade relationship in order to conclude the Withdrawal Agreement.

Elsewhere, the Irish Revenue Commissioners are preparing to introduce full customs checks on goods coming from the UK after 29 March next year, if no Brexit deal is reached. Worst case scenario plans include goods being profiled and subject to check, and agrifood products being subject to border controls. There are also reportedly plans to have as many import checks and controls carried out away from ports and airports, to allow goods to move “as free as they can.”

Source: The Irish Times I Press Association GOV.UK Bloomberg The Irish Times

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Germany prepares domestic legislation for Brexit transition period

The German government yesterday announced it was preparing legislation for the Brexit transition period, with a spokesperson saying it would only come into force if a Withdrawal Agreement was reached. The draft law clarifies that, as regards the application of German legal acts which refer to membership of the EU or the European Atomic Energy Community, the UK would still be considered a full member of both during the transition period. The law further ensures that UK citizens applying for German citizenship before the end of the transition period would still be treated as EU citizens, allowing them to keep their UK passport when adopting German citizenship.

Source: German Foreign Ministry Reuters

The Sun: Cabinet plans to convince local Conservatives to support Chequers proposal

According to The Sun, Prime Minister Theresa May is planning to send Cabinet ministers across the UK to “sell” the Government’s Chequers proposal for a future partnership with the EU to local Conservative members, ahead of the Party’s conference at the end of the month.

Elsewhere, the Eurosceptic European Research Group (ERG) of Conservative MPs has reportedly prepared an alternative to the Government’s Chequers proposal, with plans to roll out “written papers over the weekend” to present the proposal, the BBC reports. The ERG will reportedly argue for a Canada-style free trade agreement with the EU.

Source: The Sun BBC News

UK government to test new scheme for non-EU agricultural workers

The UK government has announced it will test a new scheme for agricultural workers from non-EU countries. Under the scheme, which is set to start next March and run for two years, two authorised agencies would recruit 2,500 non-EU workers to work for up to six months each on UK fruit and vegetable farms. Home Secretary Sajid Javid said the pilot project “will ensure farmers have access to the seasonal labour they need to remain productive and profitable during busy times of the year.” The National Farmers Union welcomed the decision, with its President Minette Batters saying, “Growers will take great confidence in knowing that they will have access to workers for the 2019 harvest, during what have been extremely testing and uncertain times for the sector.”

Source: Financial Times

Financial Times: UK ports group prepares for increased freight at Northern ports post-Brexit

According to the Financial Times, Associated British Ports (ABP), the UK’s leading ports group, is expected to announce a £36 million investment in its terminals in the North of England as shipping companies are expected to seek alternatives to Dover after Brexit. ABP said, “Cargoes originally destined for ports such as Dover are moving increasingly north as trade partners look at alternatives to mitigate any difficulties the more traditional routes may experience in future.” DFDS, Northern Europe’s largest shipping company, has also announced it is expanding its own terminal in Northern England at Immingham. The pan-European transport company Unifeeder has also recently introduced new routes from Dunkirk and Antwerp to Teesport, and Rotterdam to the Port of Tyne.

Source: Financial Times

UK Civil Aviation Authority announces plans for 'No-Deal' Brexit

Britain’s Civil Aviation Authority is stepping up efforts to ensure that airlines and aerospace companies can carry on functioning in the event of a no-deal Brexit, Bloomberg reports. The plan includes the recruitment of “staff with the expertise to take over the certification of parts and planes should the split cause Britain to leave the European Aviation Safety Agency, which is currently responsible for such approvals,” adding that “Up to 20 airworthiness engineers are being sought and steps are being taken to estimate the potential workload,” according to Tim Johnson, CAA policy director. Major carriers and manufacturers have raised concerns that “a hard Brexit would leave jetliners and components without the required approvals.  Johnson said there have been no direct discussions with EASA on no-deal contingency planning, and that the continuation of the status quo remains preferable for both the CAA and the government.”

Source: Bloomberg

Merkel: Shifting euro clearing out of UK after Brexit “makes sense”

German Chancellor Angela Merkel yesterday said of a possible move of euro-clearing business from London to Frankfurt after Brexit, “I can explain to everybody the political rational, that euro clearing takes place in the Eurozone. And in such a case, Frankfurt of course is the preeminent location.” She added, “We also have to consider again the costs [of moving clearing]. But all in all it makes sense.” Merkel also announced that her government was preparing legislative changes to make the German labour market for bankers more flexible.

Source: Handelsblatt Bloomberg

Shadow Brexit secretary says Labour would not support Canada-style Brexit deal

Shadow Brexit Secretary Sir Keir Starmer yesterday said the Labour Party would not support a free trade agreement similar to the one the EU has agreed with Canada as a model for the future UK-EU relationship, while also saying that the Government’s Chequers proposals for the post-Brexit partnership “cannot form the basis of a deal.” Starmer said, “Whatever the agreement – if there is one – it has to keep to the solemn commitment of no hard border with Northern Ireland. The only combination that will meet that commitment is a customs union with the EU and a single market deal with high alignment.”

Meanwhile, Labour Party leader Jeremy Corbyn yesterday did not rule out the possibility of a second Brexit referendum when pressed during Prime Minister’s questions yesterday. Prime Minister Theresa May told the House of Commons that the UK Government will not be holding a second referendum.

Source: The Guardian Bloomberg

UK service sector activity picked up in August, but business confidence falls

Figures show activity in the UK services sector picked up between July and August, with the purchasing managers’ index (PMI) for services recording an increase from 53.5 to 54.3. Any score above 50 indicates growth. The stronger performance in services is expected to offset recent slowdowns recorded in manufacturing and construction, and put the UK economy on track for 0.4 percent growth in the third quarter. However, the PMI survey found that optimism for the year ahead among services companies has fallen to its lowest level since March. Williamson, the chief business economist at IHS Markit, said, “[This is] largely reflecting increased anxiety over Brexit negotiations”.

Source: The Daily Telegraph The Guardian

Henry Newman: Chequers isn’t dead yet. But without it we could be heading for no deal.

Writing in The Times’ Red Box, Open Europe director Henry Newman argues that Prime Minister Theresa May’s Chequers proposal “is not yet sunk.” He writes, “It’s far from perfect. There are details to criticise… But overall it has some merits: it would help protect British manufacturing while allowing more control over services which makes up 80 per cent of our economy.” Newman adds, “Yet the government has badly botched its handling. Half-hearted summertime attempts to promote Chequers have not improved its popularity… Theresa May now needs to get on the front foot and sell her policy.” He concludes, “There’s no direct need to finalise the future UK-EU relationship before Brexit. However both sides want some clarity about the future. If it’s not going to look like Chequers, it’s time to start dusting off the Canada deal. But it’s unclear then how the Irish problem could be solved.”