UK cannot cherry-pick trade deal, warns EU
Britain must be free to go its own way after Brexit, Prime Minister will be told as she faces Cabinet row
THERESA MAY will today face a Cabinet row over Brexit after the EU warned that there was “no way” that the Prime Minister would be able to strike a bespoke trade deal with Brussels.
Michel Barnier, the EU’S chief Brexit negotiator, said that Britain must “face the consequences” of Brexit and could not “cherry-pick” and still enjoy the benefits of the Single Market after Brexit.
Allies of Boris Johnson, the Foreign Secretary, and Michael Gove, the Environment Secretary, said Mr Barnier’s comments significantly boosted their case for Britain to be free of EU regulations and laws after Brexit.
Eurosceptics in the Cabinet, who also include David Davis, the Brexit Secretary, and Liam Fox, the International Trade Secretary, want Britain to diverge from the EU so it is free to strike trade deals with other countries.
However, Philip Hammond, the Chancellor, Amber Rudd, the Home Secretary, and Greg Clark, the Business Secretary, want to ensure the UK remains closely aligned with the EU to reduce the impact on the economy.
The Prime Minister will today insist that the UK will be free to negotiate and sign trade deals during a two-year transition period after Brexit.
There was confusion last week when the EU’S negotiating guidelines said that Britain must comply with the bloc’s trade policy during the transition. However, Brussels sources subsequently confirmed that the UK will be able to sign deals with other countries as long as their implementation does not take place until 2021.
In an interview with Prospect magazine, Mr Barnier said the UK would not be able to “mix up” the benefits of Norway, which is a full member of the Single Market, and Canada, which has trade and services agreement with the EU. He said: “They have to realise there won’t be any cherry picking.
“We won’t mix up the various scenarios to create a specific one and accommodate their wishes, mixing, for instance, the advantages of the Norwegian model, member of the Single Market, with the simple requirements of the Canadian one. No way. They have to face the consequences of their own decision.”
Mr Johnson and Mr Gove’s allies said that Brussels had effectively “torpedoed” Mr Hammond’s hopes of securing a close alignment with the EU after Brexit. However, a government source insisted that Mr Barnier’s intervention was a negotiating “bluff ”.
It comes after Mr Johnson warned in an interview at the weekend that the UK must not become a “vassal state” of the EU after Brexit. The Prime Minister will today try to address criticism of the two-year transition she is attempting to negotiate with the EU after Brexit in March 2019.
Eurosceptics have warned it will effectively delay Brexit until 2021 because Britain’s relationship with the EU will be virtually unchanged during that period.
Addressing the Commons, the Prime Minister will say that the UK will be able to negotiate and sign new trade deals during the transition period, although they will not come into force until it ends. She will also announce plans to register new migrants during the transition, who will be subject to controls after the UK leaves the European Union.
She will say: “As I proposed in Florence, during this strictly time-limited implementation period which we will now begin to negotiate, we would not be in the Single Market or the Customs Union, as we will have left the European Union.
“But we would propose that our access to one another’s markets would continue as now, while we prepare and implement the new processes and new systems that will underpin our future partnership.
“During this period we intend to register new arrivals from the EU as preparation for our future immigration system. And we will prepare for our future independent trade policy by negotiating – and where possible signing – trade deals, which could come into force after the conclusion of the implementation period.”
The new divide in British politics is no longer between Remainers and Leavers, but convergers and divergers. To what extent will post-brexit Britain effectively mirror what the EU does on trade and services or plough its own furrow in the world?
This has been the key question since the vote to leave in June last year, but it has never formally been addressed by the Government. This is principally because ministers do not agree on the way forward. The Cabinet is due to hold its first set-piece discussion tomorrow, after preliminary proceedings today in the subcommittee that drives policy. This is about more than seeking to resolve a technocratic distinction; it goes to the heart of the sort of relationship the UK will have in the long term with Europe.
So far, the convergers have the upper hand. Last week’s agreement in Brussels to move on to the next stage of the negotiations envisages a twoyear transition period after March 2019, during which the UK will, to all intents and purposes, remain in the single market and the customs union. We will also have to accept any new regulations agreed in Brussels and be subject to the rulings of the European Court of Justice, even though we will no longer be in the EU.
Philip Hammond, the Chancellor, who is most associated with the convergence side, has said that “we’re committed to creating an environment which will effectively replicate the current status quo”. Some Leave-supporting Conservative MPS are unhappy that the UK is to remain in a subordinate position for at least two years after March 2019, but are being urged to go along with it as the price to be paid for getting out of the EU.
Their main concern, however, is that this transition phase will turn into something longerterm, with convergence eventually winning over divergence. Boris Johnson, the Foreign Secretary, sent up a warning flare yesterday when he said that failure to ditch EU law would make Britain a “vassal state”. Mr Johnson intends to advance the case for a “liberal Brexit”, with the maximum freedom to diverge from Brussels’ laws. He wants a deal that “gives us that important freedom to decide our own regulatory framework, our own laws and do things in a distinctive way”. Theresa May said at the weekend that she would not be deflected from Brexit; but we still do not know what it will entail or how these two conflicting visions can be reconciled.