Welsh compromise for those trying to
With the start of the process that will take the UK out of the European Union due to be triggered by Theresa May tomorrow, how will the interests of Wales play out in the negotiations? Chief Reporter Martin Shipton delivers his assessment
IT’S nine months since the UK voted for Brexit, but while the vast majority of babies conceived on June 23, 2016, are now fully formed, there remain considerable uncertainties about the course negotiations between the EU and the UK will take.
Just as there are disagreements within the UK over the kind of Brexit that would be preferable, voices within the EU are by no means unanimous about how the UK should be treated.
Politicians on all sides make statements for public consumption that they don’t necessarily mean, but it would be foolish for the UK to assume that EU negotiators are inspired by feelings of generosity towards the first member state to pull out since the organisation was founded in an earlier guise in 1958.
Michel Barnier, the EU’s chief negotiator, has made it clear that the first item on the agenda of Brexit talks will be the size of the “divorce” settlement the UK will be expected to pay. This will be a tough start to discussions, and could result in a swift end to them.
So far as the EU is concerned, the UK signed up to programmes that will run until 2023. From the EU’s perspective, the fact that the UK wants to leave in 2019 is irrelevant and not a reason to allow a rebate on what amounts to a contractual commitment.
Barnier has also let it be known that he will be in no hurry to start negotiations. As a Frenchman, his attention will be on his nation’s Presidential election, which takes place over two rounds in April and May. Negotiations between the EU and the UK are not likely to begin, therefore, until the middle of May or even early June.
For a UK Government which has nailed its colours to the mast of a hard Brexit, the prospect of having to pay an exit fee to the EU is fraught with political danger. Most Leave voters were persuaded to vote the way they did because they were convinced that the UK was paying extortionate sums to an organisation top heavy with over-paid foreign bureaucrats. Few perhaps realised that most of the money was committed to agricultural and social programmes.
Estimates of the amount the EU will demand from the UK before further negotiations can take place vary from £20bn to £60bn, mostly at the upper end. It will be humiliating for the UK Government to accede to such a demand, and politically extremely difficult because an agreement to pay anything but a trivial amount will inevitably be portrayed as a betrayal by the newspapers which have whipped up anti-EU feelings for years.
Welsh Labour MEP Derek Vaughan believes there is a possibility that the talks may end abruptly because of that.
“We’ve recently been hearing messages from the UK Government along the lines that ‘no deal is better than a bad deal’,” he said.
“It can’t be ruled out that this is a softening up of public opinion before a walkout from the talks over the question of the ‘divorce’ bill.”
If that did happen, the consequences for Wales in particular could be very negative. The UK’s trading relationship with EU countries would default to World Trading Organisation rules that would see punitive tariffs imposed on the export of UK goods and services. Wales, as both a net beneficiary of EU funds and as a net exporter of goods like beef and lamb, would lose out badly.
But even if the UK Government manages to emerge relatively unscathed from any “divorce” settlement, there would be huge hurdles to jump.
Theresa May has said she wants the UK to leave the European Single Market – but to have a free trade deal instead that would replicate the advantages of Single Market membership without the disadvantages. What she is seeking in essence is tariff-free access to the Single Market without non-tariff hurdles, the right to opt out of EU freedom of movement rules, and the right to conclude free trade deals with countries outside the EU on the basis of separate negotiations. She’d also like to get away with paying as little as possible into the EU’s coffers in return for any deal.
Such, at least, are the hopes that have been expressed in public about the UK Government’s desired outcome from the negotiations.