Britain’s Prime Minister Theresa May is in a fighting mood. She’s threatened that Britain has the option of simply walking away from the EU if there’s no good deal on offer. That would entail Britain unilaterally tearing up the European Communities Act, enabling the country to begin negotiating global trade deals which cannot be done with any seriousness as long as the UK is a member — something considered tantamount to bigamy.
In that event, the Treasury would save billions in contributions to Brussels amounting to approximately €10 billion (Dh39.28 billion) annually. However, there would be repercussions to a cut-and-run policy. Any nation that reneges on its signed-and-sealed commitments to its closest allies will be viewed as an unreliable partner just as a businessman who dumps his longtime partner in a mountain of debt might have trouble finding new ones for a coming venture.
The PM says she wants a more open globalist country and is already feeling the pulse of such potential trading partners as India, Australia and New Zealand but under EU rules no deal can be signed until the post Article 50 two-year withdrawal period is up. In any case, those kinds of agreements can take many years to finalise.
She’s no doubt buoyed by encouragement from US President Donald Trump that leaving the EU is the right thing to do and even more so by his commitment to put the UK — resigned to the back of the queue by former US president Barack Obama — at the forefront. That said, any negotiations with a US president with protectionist leanings, who’s unashamedly vowed to put America first, may not be favourable to British interests and even were they, he could be voted out of office before they got off the ground.
Britain is hardly flavour of the year in Europe’s corridors of power where May cuts a lonely figure. Indeed, the Prime Minister was not invited to the EU’s annual dinner where heads of state exchange seasonal greetings. British diplomats have been barred from attending certain EU meetings. The British ambassador resigned citing his government’s unpreparedness and had to be replaced, which heightens concerns May’s government hasn’t a clue how to proceed with this messy divorce.
Some European leaders see the UK’s decision to leave almost in terms of treachery; others are more pragmatic arguing for compromise. Yet others fear Britain’s exit could turn the European experiment into a fragile house of cards with other dissatisfied member states following suit. But almost all agree that to deter leavers, May cannot have her cake and eat it too. She has to take the rough with the smooth meaning there will be no access to the free market without acceptance of the free movement of people and given that immigration loomed large on the majority of pro-Brexit voters. That concession is off the table, so instead the PM is resigned to the fact that her earlier half-in, half-out approach isn’t workable.
Instead, she’s focusing on “a bold and ambitious free trade agreement with the European Union” which could take many years to negotiate, and may never reach fruition so long as any one of the existing member states has a veto.
She also seeks to protect the rights of EU citizens living and working in Britain — provided Europe will offer a quid pro quo for Britons in Europe. For that she should work on creating a warmer climate with European leaders.
Threatening to walk off into the sunset is not the way to win friends and influence people. To be fair, some EU representatives, heads of state and media outlets characterising this once imperialist power as “Little England” have been similarly scathing.
The unmaking of a financial hub
In the meantime major banks are planning to relocate thousands of jobs to European capitals. The City of London is bracing for what may come in the hope it will remain the continent’s financial centre. Sterling remains volatile with some pundits expressing the belief its ultimate decline will see the currency’s worth on parity with the dollar.
In reality, nobody can predict with any certainty how Brexit will affect the cash in Britons’ pockets but inflation caused by the weaker pound is already higher than predictions pushing up prices. Job losses are another impacting factor. Ireland reveals that over 100 companies have tentatively enquired about the prospects of relocating there. Numerous multinationals are casting their eyes at Paris or Berlin.
Apart from guarding against economic woes, Downing Street must work to preserve close security, intelligence and military cooperation with its European allies, in particular at a moment when the new US President is pulling up the drawbridge, set to cement ties with Russia while denigrating Nato as “obsolete”. In short, Prime Minister May should tread cautiously through an unprecedented minefield that in the worst-case scenario, far from giving Britain an open door to the world, she could thrust it into isolation.
Linda S. Heard is an award-winning British political columnist and guest television commentator with a focus on the Middle East.
