Theresa May unveils UK soft Brexit blueprint, but banks cut loose
Banks in particular will lose their current access to the EU market, as the government gives up on its earlier plan for both sides to recognize each other’s regulations
London/Brussels: Theresa May released the most contentious document of her two-year premiership on Thursday, vowing to push through her plan to keep the UK closely tied to the European Union single market after Brexit.
Despite the resignation of two pro-Brexit Cabinet ministers and a growing rebellion from within her own party, May published a 98-page “white paper” setting out in detail the deep trading partnership the UK wants with the EU.
At its heart is a proposal for a new UK-EU “free trade area,” with interlinked customs regimes, and identical regulations for industrial goods and agri-food. While there would be “no tariffs on any goods,” the UK’s vast services sector will suffer significant disruption. Banks in particular will lose their current access to the EU market, as the government gives up on its earlier plan for both sides to recognize each other’s regulations.
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May faces a huge task trying to persuade EU negotiators to accept that the proposals are viable, while also keeping her Conservative party and Parliament on side. Time is running out to reach an exit agreement by the self-imposed October deadline, and May’s plan has nothing new about the critical issue that’s holding up progress: avoiding customs checks at the border with Ireland.
Even US President Donald Trump took a view. Hours before he is due to touch down in the UK, he lobbed a verbal hand grenade at his host, saying May isn’t giving voters the Brexit deal they wanted.
‘Brexit is Brexit’
“I would say Brexit is Brexit,” Trump said on Thursday at a news conference at the NATO summit in Brussels. “The people voted to break it up so I would imagine that’s what they would do, but maybe they’re taking a different route — I don’t know if that is what they voted for.”
May appealed to European negotiators to “engage” with her blueprint in the same spirit of respect that she said her government was taking toward the EU’s own principles and red lines.
“Our proposal is comprehensive. It is ambitious. And it strikes the balance we need -- between rights and obligations,” May wrote in the foreword to the white paper. “It would deliver a principled and practical Brexit that is in our national interest, and the UK’s and the EU’s mutual interest.”
The UK has also set out a complicated structure for supervision of the new relationship that would allow the two sides to discuss rule tweaks and include a mechanism for solving disputes.
The British prime minister, European leaders and ministers would establish a “governing body” to set the direction of the future relationship, while a joint committee of officials would provide the day-to-day running of the agreement.
Crucially, in a move that could anger Brexiteers, if there’s a dispute over the interpretation of EU rules that the UK has agreed to adhere to, the European Court of Justice could have the final say.