Publications 2017

Reality bites: the Brexit negotiations seen from the other side of the Channel

24 July 2017
Fabian Zuleeg (Chief Executive and Chief Economist)

The Brexit negotiations continued this week with the UK government still insisting that the endpoint be an exit from the EU, including its Customs Union and the Single Market. But back in Britain, the turmoil is obvious, with different members of government taking diverging views, suggesting, at times, that a soft Brexit or a transition arrangement might be possible, even if it means concessions on the role of the European Court of Justice (ECJ), the exit payment, the rights of EU citizens and even (temporarily) continued freedom of movement of EU citizens.

Adding to this is a chorus of voices outside government demanding that the UK reconsider its position, following the indecisive general election. Many are now suggesting that Brexit is not inevitable. One of the latest voices has been Tony Blair, suggesting that the UK’s position could be reversed, in part based on presumed concessions of the EU27 on freedom of movement.

What is missing in these discussions is a real appreciation of the view from the other side of the channel. The assumption that the EU27 are willing to accept any deal to avoid Brexit is misguided. Not only are there red lines that they will not cross, but the clock is ticking as well. The time left to strike a deal is limited. It is for the UK to come up with workable solutions as otherwise the UK will end up with no deal at all. While this is also negative for the EU27, it is seen as the UK’s choice and not something that needs to be avoided at all costs.

The reason that the EU27 are willing to accept this negative outcome is that greater goods are at stake: the unity of the EU27, the integrity of the Single Market and the future of European integration. While there is willingness to find a compromise with the UK, a country leaving the EU cannot be better off than a remaining member. Allowing cherry picking of benefits would act as a signal to others inside the EU that a Europe à la carte is obtainable, opening the Pandora’s box of disintegration.

But this hard line is also based on the nature of the Union: in the end, the EU is a community of law, underpinned by the EU Treaties and safeguarded by the European Court of Justice. The notion that the EU could somehow concede on fundamental aspects of the treaties, such as freedom of movement or the oversight of the ECJ, is not only unlikely but would be struck down by the Court when challenged, making the Tony Blair suggestion unworkable. A deal, including a transition arrangement, will only be possible if the UK accepts the EU’s red lines while, at least temporarily, breaking the promises made to the UK electorate, as well as accepting a safeguard mechanism to prevent the UK reneging on its commitments, given the lack of constitutional provisions to bind Westminster to any deal.

If the UK realises that any deal would be far inferior to full membership and inflict significant political costs on the UK, there could even be a reconsideration of the UK’s decision to leave. But a re-remain decision would not necessarily be met with enthusiasm on the other side of the channel. The way the UK has conducted these negotiations has burned many bridges and there are precious few allies and friends left. And the longer this approach prevails, the harder will it be to turn the situation around.

But despite the collateral damage, most EU27 would probably welcome a committed and constructive UK back into the fold if a significant political change occurred, although asking London for concessions on issues such as the UK budget rebate. But could the UK still credibly demonstrate full commitment to the EU? It is likely that the Brexit issue will continue to divide the country’s society and political class; a reversal of the decision to leave would deepen the existing cleavages further. There is a high chance that the UK would be unable to constructively contribute to EU decisions, given the turmoil at home, and a re-leave decision would always remain a possibility, inflicting continuous uncertainty on the EU27.

To have any chance of a successful conclusion of the negotiations, the UK must now address the myths and misconceptions of the EU27’s position. There needs to be a recognition that there will be little give from the other side of the channel. Only if the UK is willing to make significant concessions, is a viable deal possible. Even a transition deal will require the UK to accept the EU27’s conditions. Some in the UK might argue that under those circumstances, no deal is better, even if it imposes economic and political costs. That is a choice. But having the cake and eating it too is not a choice the EU27 will allow.

Fabian Zuleeg is Chief Executive and Chief Economist at the European Policy Centre (EPC).

Disclaimer: The views expressed in this Commentary are the sole responsibility of the author.

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