Trea­sury chief: UK may need 3-year tran­si­tion

Kuwait Times - - BUSINESS -

Bri­tain will abide by some Euro­pean Union rules for up to three years af­ter it of­fi­cially leaves the bloc in March 2019, the coun­try’s Trea­sury chief said Fri­day.

Trea­sury chief Philip Ham­mond said a tran­si­tion pe­riod is needed “to get from the sta­tus quo to­day to the new nor­mal.” He said the tran­si­tion should end be­fore Bri­tain’s next elec­tion, which is sched­uled for 2022. Many Bri­tish busi­nesses ac­cuse the gov­ern­ment of send­ing mixed sig­nals about Brexit. Of­fi­cials say Bri­tain will leave the bloc’s sin­gle mar­ket and cus­toms union, and end free move­ment from EU coun­tries.

But of­fi­cials also say the changes, which have huge eco­nomic im­pli­ca­tions, won’t hap­pen overnight.

Ham­mond told Sky News that a tran­si­tion pe­riod will let busi­nesses “go on op­er­at­ing nor­mally” while Bri­tain works out its post-Brexit re­la­tion­ship with the EU. His com­ments come amid con­flicts within the gov­ern­ment be­tween those, in­clud­ing Ham­mond, who want a com­pro­mise “soft Brexit” to ease the eco­nomic shock of leav­ing the EU, and those who want a clean, sharp break.

More than a year af­ter Bri­tons voted to leave the bloc, many as­pects of the UK’s fu­ture re­la­tions with the EU re­main un­clear. That in­cludes the na­ture of any trade re­la­tion­ship, the sta­tus of some 3 mil­lion EU cit­i­zens who live in Bri­tain and the fu­ture of the bor­der be­tween North­ern Ire­land, which is part of the UK, and EU mem­ber Ire­land.

The Bri­tish and Ir­ish gov­ern­ments say they want to avoid cus­toms checks or other for­mal­i­ties at a bor­der that is cur­rently nearly in­vis­i­ble - but it’s un­clear how that can be made to work.

Ir­ish Prime Min­is­ter Leo Varad­kar said Ire­land did not want an eco­nomic bor­der be­tween the two coun­tries. He said it was up to Bri­tish sup­port­ers of Brexit “to say what it is, say how it would work and first of all con­vince their own peo­ple, their own vot­ers, that this is ac­tu­ally a good idea.”

The prime min­is­ter of EU mem­ber Malta, mean­while, said he is start­ing to be­lieve that Bri­tain’s di­vorce from the Euro­pean Union will not hap­pen. Joseph Mus­cat, whose coun­try held the EU’s pres­i­dency for the first half of 2017, said he saw signs that Bri­tish pub­lic opin­ion is turn­ing. In an in­ter­view with Dutch news­pa­per De Volk­skrant, he said he hopes a Bri­tish politi­cian will “stand up with the courage” to of­fer vot­ers a new ref­er­en­dum on the fi­nal Brexit deal. — AP

Trea­sury chief Philip Ham­mond

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