STATE OF PLAY

On Monday, PM Boris Johnson met with: President of the European Council Charles Michel; President of the European Commission Ursula von der Leyen and President of the European Parliament David Sassoli via video conference to take stock of progress and agree actions to move forward in the negotiations. They agreed in principle to inject “new momentum” into the negotiations and despite tough talk from both sides, privately officials said the mood was improving. After the meeting, Johnson said there was “no reason why we shouldn’t get this done in July”, adding that he had urged the EU to “put a tiger in the tank” of the talks and that “What we need now is to see a bit of oomph in the negotiations.”

Despite Johnson’s optimism, senior EU diplomats have cast doubt on No 10’s hopes of securing an outline deal in the summer, with an official saying “We don’t expect negotiations to really get off the ground before the beginning of September, and also only if we see that the United Kingdom will go towards a more realistic approach”. Brussels insiders are also seeking to play down expectations that the German Chancellor Angela Merkel will broker a deal in the autumn. According to a leaked German Government document, Germany, which will take over the EU presidency in July, expects the negotiations to take longer, with September being earmarked as the key month. Stressing that “the situation is less serious than in 2019, as important regulations, for example for citizens, were sorted out in the withdrawal agreement”, the document nonetheless urges EU states to prepare for a ‘no-deal 2.0’ no deal Brexit ahead of the October deadline, noting that the transition deal would not be extended beyond the end of this year. must be safeguarded to avoid a “race to the bottom” while reiterating that Parliament’s consent was required.

The sceptical approach to the No 10 timetable is matched in the European Parliament, which voted on Thursday by a large majority in favour of a new resolution stating that EU standards to any future trade agreement with the UK is conditional on UK agreeing to a level playing field “…, state aid, and on the conclusion of a satisfactory agreement on fisheries.”. David McAllister, the German MEP, who chairs the EU-UK co-ordination group, said: “If the UK now definitely doesn’t want to extend the transition period we need a ready legal text by 31 October so we’d better get cracking.”

In an attempt to help unlock the stalemate, Johnson is now reportedly willing to consider a new approach. The idea, which has not yet been raised by either side, would entail the UK asserting its right to walk away from the EU’s proposed regulatory “level playing field”. In exchange, the EU would have the right to impose tariffs on UK goods. The idea, which was first floated in The Spectator magazine and seized on by British officials, has also been suggested by MPs on the Commons Brexit Committee, who, in a new report, have proposed an agreement “that takes as its starting point the de facto alignment of the UK and the EU when it comes to current rules and standards,” with future market access dependent on continued adherence. However, asked to comment on the proposal, an EU official said, it “doesn’t work… It means a relationship based on constant disputes and trying to see how much you can get away with, rather than a common understanding of what makes a fair and solid level playing field.

OTHER KEY DEVELOPMENTS

  • Cabinet Minister Michael Gove has said that the government is to reimburse Northern Irish businesses if they are hit by tariffs due to a collapse in Brexit talks. Giving evidence to the Northern Ireland Affairs select committee, he also insisted there will be no new processes for NI businesses sending goods to GB as a result of Brexit. However, he was unable to give details about exactly what new processes will apply, saying that some clear direction would be forthcoming later in the summer.
  • The UK Government will prepare businesses and the public for a ‘no-deal’ Brexit scenario by using “shock and awe” tactics based on advice from behavioural scientists. The plan is to split the communications across four “bursts”. Between July and August efforts will be focused on “nudging” people to take action by warning of “consequences and opportunity”, before moving to a “shock and awe” approach between September and November. Between December and January, the campaign is to focus on “loss avoidance” and from January 2021 onward it is to emphasise “new opportunities.”
  • The UK has revealed its objectives for free-trade agreements with Australia and New Zealand and said talks will begin “shortly”. Separately, US Trade Representative Robert Lighthizer has said that it is “almost impossible” that a UK-US free trade deal will be signed before the US election in November. His comments came as the US and UK had the second round of negotiations this week.

Many thanks to consultant Nicky Donnelly, a valued client and former public affairs and communications manager, with nineteen years’ experience in-house with a multi-national and via consultancy, in the UK, Greece, Ireland and Brussels.