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Britain’s Hand Has Weakened Since Brexit Vote

Posted by hkarner - 31. März 2017

Date: 30-03-2017
Source: The Wall Street Journal By SIMON NIXON

In divorce talks with the EU, it is Prime Minister Theresa May, not the bloc, that has a unity problem

Prime Minister Theresa May responds to questions in the House of Commons on Wednesday after announcing the start of the two-year countdown to the U.K. leaving the EU.

What was striking on the day Theresa May invoked Article 50 was how much the world had changed in nine months. During the referendum campaign, one of the strongest arguments advanced by the Leave campaign was that the European Union was on the brink of collapse and that the U.K. needed to escape the burning building.

Brexiters had been forecasting the imminent demise of the European project for a quarter of a century, and with the EU in the grip of a debt crisis and a migration crisis, it seemed as if their predictions may have been finally about to come true. The assumption was that the British Prime Minister would have the whip hand in Brexit negotiations over a weak and divided EU.
Yet that isn’t how it looks today. Mrs. May is about to enter into negotiations with an EU stronger and more united than even EU leaders dared imagine only months ago. In the dark days after Brexit, when the EU appeared unable even to ratify a trade deal with Canada and when populists were riding high in the polls, it wasn’t just Brexiters who wondered if the EU’s days were numbered. But since the start of the year, the recovery of confidence among EU leaders is palpable, helped by a robust economic recovery, falling unemployment and a slump in support for populist parties since the election of Donald Trump.

The Dutch elections saw a sharp rise in support for centrist pro-European parties; similarly polls show the pro-European Emmanuel Macron as clear favorite to win the French presidency. In Germany, support for the right-wing AfD party has fallen to its lowest level since before the refugee crisis. Even the political risks in Italy, where anti-EU parties are currently polling around 50%, can be overstated given the formidable political and constitutional obstacles in the way of any Italian euro exit referendum.

Meanwhile Brexit has had a galvanizing effect on the EU, forcing its leaders to look into the abyss and conclude that their interests lie in continuing to work together to confront multiple common problems of which Brexit is, for most member states, not even the most pressing.

A recent white paper outlining possible scenarios for the future development of the EU has prompted a lively debate among EU capitals. EU officials are now more optimistic than they have been for several years that there is a realistic prospect that meaningful reforms designed to strengthen the eurozone and the EU’s borders might be possible after the German elections in September. The EU goes into the Brexit negotiations determined to defend the integrity and coherence of its single market.

Far from escaping a burning building, the U.K. risks being shut out of the room as the fate of Europe is decided— a situation British foreign policy has for hundreds of years tried to avoid.

Indeed, it is the U.K. that appears to have the real problem with unity. Mrs. May must conduct the negotiations against a backdrop of rising nationalism in Scotland and Northern Ireland and polls that show nearly half the country continues to oppose Brexit.

This changed political reality has clearly had an impact on Mrs. May’s approach to the negotiations. On the one hand, she has adopted much more emollient language: gone is the talk of no deal being better than a bad deal. She now talks of a new deep and comprehensive partnership while acknowledging that an exit will come with “consequences” for the U.K., including the inevitability that British businesses, when trading with the EU, will have to accept EU rules over which the U.K. has no control. That is a recognition of Britain’s weakened position.

On the other hand, she has doubled down on the threats, not least the stark linking of a deep and comprehensive trade deal to future security cooperation. She is also insisting on an all-U.K. solution, thereby implicitly ruling out any special solution for Northern Ireland. That is an attempt to put the onus on the EU to avoid any return to a hard border between Northern Ireland and the Republic of Ireland, which might destabilize the peace process.

She is also still insisting that the future trading relationship must be discussed at the same time as the divorce settlement. The implicit aim is to use both Northern Ireland and the security of the EU as bargaining chips to secure more favorable access to EU markets than the EU has ever before allowed a third-party country. Mrs. May wants a deal that will allow the U.K. frictionless trade with the EU while still being able to pursue its own trade deals and write its own rules.

In Berlin and Brussels, officials doubt that Mrs. May has the political capital either to make compromises or to carry through her threats, believing she will be forced to seek a new electoral mandate before the two-year negotiating time is up. That may be complacent given the current feeble state of the main opposition parties.

But just as the British political class has consistently underestimated the political will underpinning the EU project, there is also a risk that Mrs. May is underestimating the EU’s ability to stand firm in defence of what it sees as the integrity and coherence of its single market.

After all, the EU preserved its unity throughout the Greek debt crisis of 2015 right up until the moment of Greece’s capitulation. Indeed, Mrs. May should remember that the only point at which the EU’s unity frayed was over whether in fact to accept that capitulation.


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