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Labour leader Jeremy Corbyn has tabled a new amendment to the EU Withdrawal Bill calling for “full access to the internal market of the European Union, underpinned by shared institutions and regulations, with no new impediments to trade and common rights, standards and protections as a minimum.” Labour’s shadow Brexit secretary, Sir Keir Starmer, said, “Labour’s amendment, along with a commitment to negotiate a new comprehensive customs union with the EU, is a strong and balanced package that would retain the benefits of the single market.” However, some Labour backbenchers have criticised the move, warning it lessens the chances of defeating the government on an existing amendment to aim for membership of the European Economic Area (EEA). Chris Leslie MP said, “If the frontbench are missing the opportunity to secure the EEA single market as a UK negotiating objective, there will be utter dismay and shock across the Labour movement.”
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In an interview with Politico yesterday, Norwegian Prime Minister Erna Solberg said that the UK “cannot be cherry picking” in negotiations for its future relationship with the EU, adding, “Norway is outside [the EU], but we are inside the single market … We do accept that decisions on the four freedoms are done in Brussels… You can’t just opt out of one of the freedoms.” While describing the Brexit process as “frustrating” for all parties, Solberg said that Norway hopes that UK-EU negotiations end up in an agreement that “makes sure Europe still stands strong.” Asked whether Norway would support the UK’s entry into the European Economic Area (EEA), the Prime Minister mentioned that there would be both benefits and disadvantages to the UK joining. This comes as Solberg met with EU chief Brexit negotiator Michel Barnier yesterday and will meet UK Prime Minister Theresa May today.
Elsewhere, Svein Roald Hansen, the Norwegian Parliament’s chief representative to the EEA and the European Free Trade Association (EFTA), told Business Insider, “Most people [in Norway] will think that if Britain wanted to join EFTA and the EEA, it would be politically very difficult to say no.” Hansen added, “Our main concern is protecting our agreement with the EU…Britain has a history of opt-outs when it comes to cooperation. In the EEA, all countries have to agree when it comes to EU rules and regulations. If one country says no [to a rule], then it does not apply to any of the countries. We all depend on each other. I would be very worried about that.”
Politico reports that UK officials are considering a “third way” customs offer that involves operating customs controls at the border between Northern Ireland and Great Britain for goods moving between the UK and Ireland. Under the proposals, goods travelling from the UK to Ireland would be customs cleared in Northern Ireland and would face no further checks at the Irish land border. The plan would also include a “green channel” for goods moving between Great Britain and Northern Ireland to ensure these faced no checks or controls.
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The deputy chief executive of the UK Freight Transport Association (FTA), James Hookham, has warned that “the industry’s frustration with the lack of progress [in the government’s Brexit planning] is building daily.” He said, “Of the eight demands in FTA’s list of essentials to ‘Keep Britain Trading’…not a single one has been progressed…With less than ten months to go until the country is set to leave the EU, we have nothing agreed.” He added, “This is a reckless attitude to take and is playing chicken with parts of the British economy and the livelihoods of the seven million Britons in the industry.”
Jon Thompson, permanent secretary at Her Majesty’s Revenue and Customs (HMRC), has suggested UK businesses could face an annual cost of £20 billion to comply with customs arrangements in a no deal Brexit scenario. He said it “would be similar in terms of cost” to the total cost of customs declarations under the government’s maximum facilitation customs model.
The European Investment Bank (EIB) is unwilling to support EU companies doing business in Iran, Reuters reports. This comes as the European Commission has proposed the EIB should finance EU-Iran trade and investment, following the US’ decision to reintroduce sanctions on economic relations with the country. An unnamed diplomat says, “The bank is unhappy with the Commission proposal because the bank raises funds on US markets [from which it may be excluded if it defies US sanctions],” with another diplomat adding, “The bank is well aware of the dangers of US sanctions on its own operation.”
Meanwhile, an EU official claims that “the US is pushing pressure on the bank not to go ahead and invest in Iran, warning of the consequences.” Former US State Department official Richard Nephew also warned, “Europe and the United States are so integrated that it is implausible that the Europeans will be able to use current institutions to engage in transactions with Iran… If they really want to do this, then they’ll need to set up siloed institutions that have no US exposure and then to protect those institutions with the threat of retaliation against the United States.”
Elsewhere, EU Commissioner for Trade Cecilia Malmström said in an interview to CNN that US tariffs are “deeply unjustified, adding that the EU will be “working with many other countries, because this is not only the EU against the US…We need to show that if you violate the rules of the international trade system, it has consequences.”
Separately, in an op-ed in French newspaper Le Figaro, France’s Economy Minister Bruno Le Maire writes that unilateralism “will lead to nowhere else except to confrontation,” adding that the EU will respond to tariffs “with strength and firmness” in order to “affirm its economic sovereignty.” Le Maire concludes, “If the US wants to renew the dialogue with its historical allies, they should make the first step.”
According to the Daily Telegraph, a group of Eurosceptic Conservative MPs have prepared a dossier in which they warn the UK Government that five of the fifteen amendments to the EU (Withdrawal) Bill, which will return to the House of Commons next week, will cause “serious damage” to Brexit. The dossier reportedly says, “There are 15 amendments… Collectively these would frustrate, delay and potentially reverse Brexit…Voting for them would not be consistent with voting for the Referendum Act, respecting the referendum result or for triggering Article 50.” The paper points specifically to amendments on the Parliament’s meaningful vote, on the exit day, on joining the customs union, on remaining the member of the European Economic Area (EEA) and giving Ireland a say over security in Northern Ireland, as the most “damaging to Brexit.”
The Daily Telegraph
Russian President Vladimir Putin yesterday said after a meeting with Austrian President Alexander Von Bellen, “It is not just Russia that is interested in a full revival of our [EU-Russia] cooperation, our European friends are interested as well,” adding that current discussions between Russia and the EU were “very constructive, but not easy.”
Meanwhile, Von Bellen criticised “the allegation made by some US politicians, that the EU’s dependency on Russia for its gas supply is too big,” adding that there was no economic incentive to switch to overly expensive American liquid gas. Putin commented, “Austria has become a key transport hub for Russian gas.”
Mexico yesterday announced new retaliatory tariffs as a response to the punitive US tariffs on steel and aluminium introduced last week. The new tariffs will apply to a range of products including cheese, apples, potatoes and pork, with the latter hit by tariffs of up to 20 percent. The Mexican Peso dropped one percent to the US dollar quickly afterwards. This comes as Mexican industry representatives worry about the domestic impact of the new tariffs, with one saying, “We think [domestic prices for pork] would rise around 15 or 16 percent, and I think that could reduce consumption which worries me.”
In an address to the Senate yesterday, the new Italian Prime Minister, Guiseppe Conte, said that his government would bring “radical change.” Conte said the government’s priorities would be to address social hardship through the introduction of universal income and to crack down on illegal immigration. On public spending, he said, “We want to reduce the public debt, but we want to do it by increasing our wealth, not with austerity that, in recent years, has helped to make it [public debt] grow.” On the EU, he stressed that “Europe is our home,” and reiterated Italy’s commitments to NATO and the alliance with the USA. On immigration, Conte said the government would end “the immigration business… We are not and will never be racists. We want procedures that determine refugee status to be certain and speedy, in order to effectively guarantee their (refugee) rights,” he said. Conte’s government will also face a confidence vote in the Chamber of Deputies today, where the Five Star Movement and the Lega Party together have a comfortable majority.
Meanwhile, former Italian Prime Minister Mario said yesterday, “It cannot be excluded that Italy may have to suffer what it avoided [in 2011], which is the humiliation of the troika.” The “troika” consists of the European Central Bank (ECB), the European Commission (EC), and the International Monetary Fund (IMF).
Mariano Rajoy, who was ousted as Prime Minister of Spain in a vote of no confidence last week, said yesterday that he would quit as leader of the conservative Popular Party (PP). “It is the best thing for the Popular Party and for me. And I think for Spain as well, ”Rajoy said, adding, “I’ve been a grassroots member and party leader… I’ve been a councillor and prime minister. But now it’s time to bring it to an end. The PP will carry on moving forward with its history of service to the Spanish people.” The party’s executive committee is due to meet in the next few days to call a conference to elect his successor.
Separately, it was also announced yesterday that the new Prime Minister, Pedro Sanchez of the Spanish Socialist Workers’ Party (PSOE), has started to name his new cabinet. The appointments only comprise politicians from PSOE and independent figures. His appointment was criticised by former Catalan premier Carles Puigdemont, who described Borell as someone “from another era” who has contributed to “the escalation of hate”.
Meanwhile, El Pais reports that Gibraltan First Minister Fabian Picardo has already written to Sanchez, reminding him of the delicate situation created by Brexit for Gibraltar and urging him to start talks over the issue.
Head of the German central bank, Jens Weidmann, yesterday warned of “dubious incentives” that could be created should the Eurozone opt for “a far greater degree of fiscal risk sharing.” He also said EU member states were “not prepared” to hand over “a significant portion of their sovereignty to Brussels… It seems to me that it’s already hard enough at times to ensure that the [European] Commission’s existing powers are enforced and respected.” He said, “More Europe does not necessarily have to mean more money for Europe… Europe first needs to define the tasks that it would make sense to accomplish jointly and that should therefore also be jointly instead of starting off by talking about money, and thus putting the cart before the horse.” Weidman stressed that much of the responsibility for fiscal stability lay with the EU’s individual member states, warning, ““I am concerned by the fact that enthusiasm for consolidation in the euro area seems to have waned… It seems the reformed [EU] fiscal rules are having just as weak an impact as the old rules.”
The EU has said that some UK military secondments to Brussels will cease after the Brexit transition period, reports the Financial Times. The Ministry of Defence said that there are “challenges surrounding new applications and extensions” of secondments, as the European Commission now considers the secondments on a case-by-case basis in order to avoid any potential conflict of interest.