As the eighth round of trade talks with the European Union is about to start, UK government officials from the chief trade negotiator, David Frost, to Foreign Secretary Dominic Raab have put out the word that Britain is ready to walk away. To underscore the point, Boris Johnson is setting a deal deadline of Oct. 15.
The prime minister is also threatening something much more serious. According to Financial Times, the government will introduce legislation this week contravening the international treaty that sealed Britain’s EU exit.
If Johnson follows through with the new law, which would weaken the Brexit Withdrawal Agreement’s provisions on Northern Ireland, he will probably scupper chances of a trade deal and undermine Britain’s international standing and credibility. At a time when his error-ridden Covid policies are under fire, it seems an odd gamble.
All of the theatrics could be just that — an attempt to concentrate minds as another round of UK-EU trade negotiations kick off. If there is a deal to be done, however, it will require political will, from Johnson and the EU governments
“This would be a very unwise way to proceed,” tweeted Simon Coveney, Ireland’s foreign and defence minister. That’s diplomat speak for, “Are you out of your mind?” The idea of effectively ripping up the Northern Ireland Protocol is so extreme it’s tempting to dismiss the suggestion as an empty threat. And yet, even the posturing is worrying.
Ireland, for those who can remember back to the herky-jerky ride of the Brexit talks, has a big stake in this. The purpose of the Protocol in the exit agreement is to keep the Irish border free of any customs infrastructure and allow the EU to enforce its own customs regime, while letting the UK pretend it hadn’t ceded any sovereignty by letting this happen. Johnson has always hated that concession.
Trade negotiations are stuck primarily over the question of state-aid rules. The EU argues that Britain should hew closely to the trading bloc’s regulations to avoid unfair competition; Johnson’s government argues that as a non-member it no longer has to obey the EU.
Only it sort of does. Under the terms of the Protocol, the UK cannot diverge from EU state aid rules in any way that impacts trade between Northern Ireland and the EU.
That may sound minor, but as the lawyer George Peretz has noted, the bar for determining such trade effects may be low. And it will be independent regulators, the courts, the European Commission and ultimately even the European Court of Justice who are the arbiters of a breach. Johnson himself will have very little say.
Regardless of the prime minister’s frustrations, abrogating an international treaty that he only recently signed would do lasting damage to Britain’s EU relationships.
Once you lose trust in that way, it’s not hard to imagine the implications for cooperation on security, counter-terrorism, migration policing and other important issues. It would have knock-on effects for future trade talks with other countries. How would anyone sign a deal with the Johnson government after that?
International treaties take precedence
It’s not clear how his government would pull it off, either. Johnson’s 80-seat majority means he can generally pass any legislation he wants. But international treaties take precedence over domestic law, so the courts would presumably invalidate any provisions that undermine the Withdrawal Agreement.
Even if Johnson is bluffing on the legislative threat, the collapse of trade talks is a real possibility, with its own set of consequences.
As much as I think he must be taken at his word when he says he’d like an agreement, the situation isn’t a repeat of last year’s crunch deal-making ahead of the withdrawal deal. Johnson isn’t trying to win an election this time, so there is no political imperative to fudge a deal.
It’s long been clear that Britain is unlikely to get a trade deal that’s significantly better in economic terms than not having one. And to strike any deal, Johnson would have to agree to compromises that would displease the ardent Brexiters in his party.
He may also have calculated that during the economic ravages of the pandemic, some increased trade friction won’t be noticed as much and an already swollen government budget can be used to soften the blow.
Or he may be betting that, following a cooling-off period, negotiations will resume: The two trading partners need each other too much to stay mad.
Big punch-up with the EU
Indeed, a big punch-up with the EU may seem just the thing right now. Labour leader Keir Starmer has gained in popularity with his accusations of government incompetence over Covid.
Refocusing attention on Brexit gives the Tories a rallying point and hands Labour a reminder of that party’s own divisions on the subject of Europe, which nearly tore it apart last year.
However, none of the arguments for walking away are compelling on grounds other than short-term political expediency. Britain has already left the EU and on Dec. 31 will lose its access to Europe’s single market. People are going to feel some impact after Jan. 1. Will they really just blame Brussels?
Of course a no-deal exit will impact business and UK. Consumers. Whether or not the aggregate impact pales in comparison with the pandemic’s wrecking ball is beside the point.
If we learnt anything from the recent UK fiasco over school exam grades, it’s that individual stories matter greatly. How will Johnson respond should small UK businesses start closing because of new trade frictions?
All of the theatrics could be just that — an attempt to concentrate minds as another round of UK-EU trade negotiations kick off. If there is a deal to be done, however, it will require political will, from Johnson and the EU governments.
So far, the UK prime minister is signalling he’s not very interested.
Therese Raphael is a columnist. She was previously an editor with Wall Street Journal Europe.
Bloomberg
