EU leaders open “Phase Two” of Brexit talks and warn Theresa May of tougher times

Jean-Claude Juncker and Theresa May at last week’s EU Council. Source: EC Audiovisual Services / Copyright: European Union, 2017 / Photo: Etienne Ansotte

Jean-Claude Juncker and Theresa May at last week’s EU Council. Source: EC Audiovisual Services / Copyright: European Union, 2017 / Photo: Etienne Ansotte


Last week, the European Union and the United Kingdom made substantial progress on their Brexit agenda, opening the most crucial part of their divorce conversations. As the latest EU Summit wrapped up in Brussels on Friday, European Union leaders agreed Brexit talks have made enough progress to move negotiations to phase two. Also, the UK revealed more of how it would like to shape its trade pact with the EU, with Finance Minister Philip Hammond saying it is likely Britain will want to negotiate a bespoke deal, rather than copying existing arrangements like the Canada-EU FTA. However, despite the many news after months of cold chats, some leaders cautioned the second phase of Brexit talks will be harder than the first, and that the toughest part of Theresa May’s job could even start now.

Sufficient progress

Just before midday last Friday, when she was already travelling back to her country, UK Prime Minister Theresa May received the news from the 27 EU leaders that Brexit talks talks have made enough progress to move negotiations to phase two. “The European Council welcomes the progress achieved during the first phase of negotiations […] and decides that it is sufficient to move to the second phase related to transition and the framework for the future relationship”, said an official European Council press release published on Friday.

Positive exchange

EU Council President Donald Tusk was the first to announce the go-ahead for the second phase of negotiations, and congratulated British Prime Minister Theresa May on Twitter. “EU leaders agree to move on to the second phase of #Brexit talks. Congratulations PM @theresa_may”, he said on Friday. UK’s PM May responded with thanks, welcoming the decision as “an important step on the road to delivering a smooth and orderly Brexit and forging our deep and special future partnership”.

The relaxed and positive exchange between leaders showed how last week’s summit marked a significant change in atmosphere between the two sides after months of tough conversations. On Thursday night EU leaders gave Mrs. May a round of applause as the British prime minister ended a short speech to a leaders’ dinner. The morning after, the President of the European Commission Jean-Claude Juncker said the applause had been deserved. “Some of us thought, including me, that she did make a big effort and this has to be recognised”, he said.

The bitter part

However, despite such a warmer approach compared to the past, the next, more decisive phase is likely to be the toughest test for Theresa May. European Commission President Jean-Claude Juncker warned on Friday that, despite the big efforts made by UK’s PM, the next stage “would be much harder than the first phase”, with the first having been very hard anyway. German Chancellor Angela Merkel echoed him on Friday at the end of the Summit. “We have made good progress, the second phase of talks can start”, Chancellor Merkel said. “But this will mean even tougher work – that was clear today in the discussion – than we have experienced so far”.

Austrian Chancellor Christian Kern went even deeper, saying even a primary school student could see that the first phase deal on the Irish border would come back to haunt the talks because it was “impossible for Britain” to leave the bloc’s single market while avoiding a hard border on the island of Ireland, as described by Reuters. “Our primary school students can see that there is a riddle to be solved”, Reuters quoted the Austrian leader as saying.

Open points

Indeed many open points will need to be touched during Brexit talks’ second phase, as “phase two” is when the discussion can widen to include the transition phase and – most importantly – trade talks. Sources report that EU leaders reiterated on Friday their position that Britain cannot conclude a free-trade accord with the bloc until it has left and become a “third country”, but this is something that Theresa May wants to bring home within the next fifteen months. If Britain and the EU will not agree on a trade pact before the UK leaves the bloc in 2019, Mrs. May might have to agree a divorce settlement without knowing precisely what the future relationship would look like, which is something that the Conservative wing in her Parliament will never accept.

Also, despite having agreed agreed at the summit to support May’s call for a two-year transition out of the bloc, EU 27 Leaders are already making clear that there will be no “discounts” for the UK during the transitional phase, as Britain will be treated as a “third country”. “Such transitional arrangements, which will be part of the Withdrawal Agreement, must be in the interest of the Union, clearly defined and precisely limited in time”, said the EU Council statement released on Friday.

Replicate the status quo

British Chancellor of the Exchequer Philip Hammond on Saturday made his call to reassure businesses that there Britain’s departure from the bloc in 2019 will represent no cliff edge. Speaking in Beijing at the UK-China Economic Financial Dialogue, just a day after EU leaders paved the way to “Brexit phase two”, the UK’s Finance minister revealed that the UK would seek to replicate the status quo even after the divorce from Brussels. “We won’t technically or legally be in the customs union or in the single market,” Mr. Hammond said. “But we’re committed as a result of the agreement we’ve made this week to creating an environment which will effectively replicate the current status quo”, he also added, as reported by the Financial Times.

Bespoke arrangements

UK Chancellor Hammond went further and described the shape a future EU-UK trade deal will have, saying it was likely that the UK would want to secure specific, “bespoke arrangements”. “We have a level of trade and commercial integration with the EU 27 which is unlike the situation of any trade partner that the EU has ever done a trade deal with before,” he told reporters. “And therefore it is likely that we will want to negotiate specific arrangements, bespoke arrangements”, Hammond added, also saying that it’s unlikely that Britain will develop a Canada-style trade deal with the EU. “I expect that we will develop something that is neither the Canada model nor an EEA model, but something which draws on the strength of our existing relationship”, Mr. Hammond said from Beijing.

As soon as Chancellor Hammond finished his speech to the press, Chinese Vice Finance Minister Shi Yaobin said “We hope the UK and the EU will conduct their Brexit negotiations in a way that’s mutually beneficial for both sides and result in outcomes that are desirable for both sides”. After last Friday this looks by all means more feasible, although it’s becoming more evident this is when the toughest part begins.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

China Unlimited Special Report: The trip to China

A Sting Exclusive: “Regional Policy: a fully-fledged investment policy”, Commissioner Cretu reveals live from European Business Summit 2015

UN chief pays tribute to Egypt’s role in avoiding ‘dramatic’ escalation in conflict across the Gaza-Israel border

Can the next financial crisis be avoided?

Fighting crime: faster EU-wide exchange of non-EU nationals’ criminal records

MWC 2016 LIVE: Verizon boasts momentum for IoT platform

EU to negotiate an FTA with Japan

Commission challenges Council over EU 2014 budget

Deutsche Bank slammed by the US-based trio of IMF, Fed and Moody’s

G20 LIVE: The European Sting covers online world news and the latest developments at G20 from Antalya Turkey

Would you let an AI vote for you?

Civilians suffering due to sanctions must be spared ‘collective punishment’ urges UN rights expert

Use “blockchain” model to cut small firms’ costs and empower citizens, urge MEPs

UN Security Council urged to act against ‘worst-case scenario’ Syria’s war-battered Idlib

Women’s leadership ‘critical’ to future of Niger

Parliament’s interparliamentary delegations established

MWC 2016 LIVE: Zuckerberg warns mobile industry not to ignore the unconnected

Children who exercise have more brain power, finds study

Banks launch green charter to help shipping reduce its carbon footprint

The unpleasant truth of plastic straws

Mexico must increase foreign bribery enforcement: full implementation of anti-corruption reforms could help

The cuts on 2014 Budget will divide deeply the EU

Parliament votes reform for better European Co2 market but critics want it sooner than later

Hatred ‘a threat to everyone’, urges Guterres calling for global effort to end xenophobia and ‘loathsome rhetoric’

These 4 Nordic countries hold the secret to gender equality

The European Council takes more measures to stem illegal migration

Climate action: 4 shifts the UN chief encourages Governments to make

The movement of anti-vaccers: taking humanity back 200 years

Eurozone in trouble after Nicosia’s ‘no’

UN General Assembly President defends ‘landmark’ migration compact

Rehn very reserved about growth in Eurozone

A very good morning in European markets

South Eurozone urgently needs fairer distribution of taxation burden

How secure is blockchain?

More women and girls needed in the sciences to solve world’s biggest challenges

Sustainable Development Goals: making the world a better place

Here’s how blockchain could stop corrupt officials from stealing school lunches

The European Commission, European Investment Bank and Breakthrough Energy Ventures establish a new €100 million fund to support clean energy investments

UN envoy says he ‘is ready to go to Idlib’ to help ensure civilian safety amid rising fears of government offensive

Long live Eurozone’s bank supervisor down with the EU budget supremo

GSMA Announces First Keynote Speakers for 2019 “MWC Los Angeles, in Partnership with CTIA”

EU-Russia relations: the beginning of a warmer winter?

We are close yet so far…

Can the EU last long if it cuts Cyprus out?

Nigeria: Armed conflict continues to uproot thousands, driving up humanitarian need

Why do US presidential elections last so long? And 4 other things you need to know

Chart of the day: These countries have the largest carbon footprints

Superbugs: MEPs advocate further measures to curb use of antibiotics

FROM THE FIELD: Changing world, changing families

“CETA is a game changer for major trade agreements”. The Sting reports live from EBS 2015

India’s economy is growing fast, but its poorest areas lag behind. Here’s why this could be about to change

Brazilian healthcare and the Global Compact for safe orderly and regular migration

Summertime Consultation: 84% want Europe to stop changing the clock

Mozambique pledging conference hopes to soften devastating blow of back-to-back cyclones

Cambodia’s schools are the new frontline in the battle against climate change

Aid funding for Occupied Palestinian Territories at ‘all-time low’

WEF Davos 2016 LIVE: “Employment contracts today are a reducing share of the workforce”, scientists worry in Davos that the 4th industrial revolution threatens employment globally

Electronic cigarettes: is it really a safe alternative to smoking?

Azerbaijan chooses Greek corridor for its natural gas flow to EU

Euro-Mediterranean Assembly fixes its permanent seat in Rome

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s