Brussels Summit Special: Another Year of Brexit Brief Beckons

The moment of truth has been delayed – again.  Barely days after confirming an extraordinary summit would occur in November, European leaders have cancelled it, saying there has not been enough progress to warrant it.  So, now, we are assured, a deal will be reached in December. With the Article 50 deadline still looming at the end of March next year, Theresa May needs to move quickly to gain something that’s acceptable to the EU-27, the European Parliament, her own party, its Northern Irish partners the DUP, and the House of Commons. Quite how she will do that, nobody knows.

The moment of truth has been delayed – again.  Barely days after confirming an extraordinary summit would occur in November, European leaders have cancelled it, saying there has not been enough progress to warrant it.  So, now, we are assured, a deal will be reached in December.

Momentum Lost

As we reported in the last Brexit brief, negotiators had been very close to having a deal ready to present to political leaders in London and Brussels.  A press conference was organised and the stage set — but on Sunday, talks dramatically ground to a halt over the Irish-border ‘backstop’ arrangements.  These arrangements, which will come into force should the two sides not reach a deal, aim to prevent the return of a hard border and sectarian violence on the island of Ireland.  However, the two sides have reached an impasse over what this ‘backstop’ should look like.  Brussels originally proposed that Northern Ireland be effectively kept in the EU customs union while Britain leaves, something UK politicians across the political spectrum find unacceptable.

The nearly-agreed deal would have instead seen the entire UK stay in the customs union until a new arrangement can be agreed, avoiding an intra-UK border but delaying the freedom to strike trade deals desired by Brexiteers. However, the proposed deal immediately proved unacceptable to the British cabinet. Brussels, meanwhile, would not accept the UK’s proposed time-limit on the backstop and insisted that the withdrawal deal separately include the backstop of keeping Northern Ireland in the customs union indefinitely, something the British prime minister quickly branded a “backstop to the backstop”.

The Breakthrough That Wasn’t

Three days after talks stalled over the Irish border “backstop”, May arrived in Brussels determined to shrug off the setback and stress that the two sides are on track for an accord. Like May, European leaders continued to express confidence a deal can be struck — even as they are growing fearful of a cliff-edge separation. As leaders arrived in Brussels, it emerged that Germany and France accelerated their preparations for a no-deal Brexit even though both publicly insist an agreement with the UK over the terms of its departure from the EU can still be achieved.

The three-hour dinner meeting was uneventful. EU chiefs said the prime minister brought no new ideas to the table last night as she addressed the EU-27. Instead, in her 15-minute speech, May highlighted progress already made and called for “courage, trust and leadership” on all sides in the final weeks of negotiations. EU leaders paid lip service to the conciliatory tone, but it is hard to imagine they were not disappointed in the lack of a substantial offer.

Buying More Time?

The one big news line from May’s speech to the EU-27 was her confirmation that Britain is considering an offer from Michel Barnier to extend the planned 21-month Brexit transition for up to a year.  The idea is that with a longer transition period, the Irish backstop becomes more palatable because there is less chance it would ever be required. The potential benefits for business are obvious: another year of mutual market access on today’s terms, continuity of data flows guaranteed, and, of course, another year of Brexit Brief.  But such an extension would also mean another year of financial contributions to Brussels and another year of the free movement of people – an appalling thought for many of May’s Eurosceptic colleagues. Former Brexit secretary David Davis said the idea was “unwise” and it was the wrong time to “take the pressure off” in the negotiations. Davis and four other Conservative former cabinet ministers signed a letter to May urging her to reject both a Northern Ireland backstop and, crucially, an all-UK version.

With the Article 50 deadline still looming at the end of March next year, May needs to move quickly to gain something that’s acceptable to the EU-27, the European Parliament, her own party, its Northern Irish partners the DUP, and the House of Commons. Quite how she will do that, nobody knows.

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