Post-Brexit talks (once again) are a game of chicken — and no one wants to blink.
On Friday, the third round of talks between the EU and the U.K. on their future relationship ended again with “very little progress made,” according to both sides, and plenty of hostile rhetorical flourishes.
But unlike at many crunch points since the 2016 referendum, everybody has bigger problems as they respond to a global pandemic, leaving drastically less political focus to force through a compromise and avoid a crash.
Having agreed a divorce package last year that allowed the U.K. to continue to trade with the EU, the two sides remain at an impasse on various issues, the thorniest being so-called level playing field rules, designed to prevent the U.K. undercutting the EU in future.
Britain’s chief negotiator David Frost said the “major obstacle” remains the bloc’s “insistence” on the U.K. abiding by EU laws and standards in exchange for access to its single market. The U.K. continues to oppose this demand, arguing Brussels does not require this of other countries it has signed free-trade deals with, such as Canada.
With the coronavirus crisis consuming so much political energy, Brexit negotiators are once again speeding toward a cliff edge while many key political figures aren’t looking.
Brussels is not budging, and sees this as key to avoiding a race-to-the bottom competitor on the EU’s doorstep. “We are not going to bargain away our European values to the benefit of the British economy,” the EU’s chief negotiator Michel Barnier said. “Economic and trade fair play is not for sale. It is not a ‘nice to have,’ it is a ‘must have.’”
The EU27 also underlined its intention to follow what Brussels sees as the letter of the law by on Thursday launching disciplinary proceedings against the U.K. for violating the EU’s freedom of movement requirements.
The Brexit timetable now looks more difficult than ever.
The EU seems to have accepted that the U.K. won’t seek an extension of the transition period, which ends December 31. That means June — the original deadline for an extension request — is no longer an important cut-off date, and leaves just a couple of months to negotiate a deal which has to be ready by October in order for both sides to ratify it in time.
With the coronavirus crisis consuming so much political energy, Brexit negotiators are once again speeding toward a cliff edge while many key political figures aren’t looking.
You blink first
Both sides insist progress can only be made if the other side gives up its core demands. While Barnier urged the U.K. “to change its strategy,” Frost said: “We very much need a change in EU approach.”
At the same time, both sides spin that the other is slowly giving in. Barnier mentioned the U.K. is moving away from its “maximalist position” on fisheries in other to work on all sort of provisions. “That same spirit might be extended to level playing field provisions and governance.”
A senior U.K. official close to the negotiations dismissed that suggestion, saying “I’d hesitate to call it progress to be honest.”
The same U.K. official acknowledged “this round was a little tetchier” in some areas, but said there was some sign of “the beginning of a process where they’re beginning to accept (that the U.K. won’t shift).”
Those small signs of compromise might provide a light at the end of the Brexit tunnel. The U.K. also said it intends to publish all of its draft legal texts next week. The talks can still go both ways, Barnier said. “The two rounds ahead of us will lead the direction of travel.”
The U.K. also said it intends to publish all of its draft legal texts next week | Daniel Leal-Olivas/AFP via Getty Images
But if neither side is willing to move, the chicken game risks leading to a car crash — a no-deal exit from the Brexit transition period.
London has always stressed it’s willing to take that risk. The U.K. still exhibits certain coolness about the possibility of a no-deal crash or — in the words of the U.K. senior negotiating official — “Australia terms.”
“We’ve always made clear that if an agreement can’t be reached then trading on what we call Australia terms is perfectly doable and satisfactory. We’ve always made clear that we want to try and get to a deal and that’s what we’re working hard to do.”
More and more this looks like a risk the EU is also more willing to take than to give in on its core issues. “The single market is our biggest plus point and won’t sacrifice it for the sake of these negotiations,” Barnier said. “The U.K. cannot pick and choose the most attractive elements of the single market without meeting obligations even EU members must meet.”
“The probability of a no-deal Brexit is increasing.” — EU diplomat
The bloc even seems ready to move to the side of the road and watch the U.K. drive itself off the cliff.
The EU has repeatedly stressed that the U.K. has much more to lose in a no-deal scenario then the EU, even though a disorderly Brexit at the end of the year would be a major blow for the EU economy as well, especially when it coincides with the recovery from the corona crisis. The EU, too, would then be unable to do anything to tame the competitor on its doorstep, should the U.K. wish to undercut the bloc.
But at his press conference, Barnier said the EU is ready for a no deal and will step up preparations. According to one EU diplomat, that’s not just bluff. “The probability of a no-deal Brexit is increasing. That once seemed like our worst nightmare. But with this corona crisis, it’s just not on top of the political agenda anymore.”
Charlie Cooper contributed reporting.