Is Hard Brexit Getting Closer? Britain fails to agree with EU on terms of exit

British Prime Minister Boris Johnson and European Commission President Ursula von der Leyen have agreed to continue negotiations on the terms of Brexit beyond their Sunday deadline.

On Saturday, the negotiations continued until late at night, but the parties could not bring their positions closer together – the conditions put forward by Brussels are considered unacceptable in London.

According to the source, any agreement between Britain and the EU must be “honest and reflect the official position of the UK, the essence of which is that in three weeks the country will be completely sovereign.”

Irish Prime Minister Mehol Martin said that he believed the abandonment scenario “would be very bad news for all of us” and “a horrific government failure” on both sides.

Joint statement

The parties released a joint statement by Prime Minister Boris Johnson and Head of the European Commission Ursula von der Leyen, which says that the negotiations will continue.

“We had a helpful phone call this morning. We discussed the main unresolved issues. Our negotiating teams have been working day and night in recent days,” the statement said.

The statement said that despite the fact that the negotiations, which lasted for almost a year, took a lot of energy from the parties, it was decided to continue them after the deadline on Sunday.

“We have instructed our teams to continue negotiations and see if an agreement can be reached even at this late stage,” the statement said.

Ursula von der Leyen added that negotiations will continue in Brussels.

“At this point, I’m afraid our differences on some key issues are still very high. But hope dies last, and we will continue negotiations to understand what we can do. The United Kingdom will certainly not leave the negotiations.” Boris Johnson told the BBC on Sunday.

Why the negotiations were extended
Yuri Vendik, BBC Russian Service:

From behind the closed doors of the Brussels offices where the British and EU delegations work, almost nothing leaks out. Therefore, those who are not involved in the negotiations can only guess why they were extended again.

The short joint statement by Ursula von der Leyen and Boris Johnson this time does not say about any deadline, control date until which negotiations can continue – although there are only 18 days left until the actual Brexit.

The sides have not recently spoken of any fundamental changes in their positions, either officially or through “leaks” – rather, on the contrary, they have repeatedly confirmed that fundamental differences remain.

Maybe the delegations did find some kind of compromise, maybe someone decided to make concessions, just doesn’t want to publicly admit it yet.

Maybe the parties saw an opportunity to conclude, as some experts have long suggested, some kind of interim agreement of limited action, which will buy time and avoid a landslide Brexit on New Year’s Eve.

Or maybe it’s just that no one – neither London nor Brussels – wants to take on historical and political responsibility and be the first to declare: everything, negotiations are meaningless, chaos in trade is inevitable from January 1, we disagree and get ready.

Why can’t we agree

The talks are about future UK economic relations with the EU. Brussels’s position is that Britain should not receive an unfair advantage over countries that remain in the union – that is, it cannot simultaneously maintain free access to the internal EU market and at the same time disobey European regulatory bodies.

The situation is similar with fisheries. The European Union insists that if European fishermen are unable to fish in the territorial waters of Great Britain, the British side will not be allowed to sell fish products to the EU as a retaliatory measure.

London is not ready for concessions. Johnson insists that Britain will independently decide who to let in its waters and how to regulate economic processes on its territory. The British side has already announced that in the event of a breakdown in negotiations, the country’s fleet is ready to start fighting illegal fishing.

“Our friends in the EU insist that they have the automatic right to punish us or take retaliatory measures if they adopt some new law in the future, and we in our country will not comply with it or will not adopt the same one. Second, they demand that Britain be the only country in the world that does not have sovereign rights to its fishing grounds. I think no prime minister of our country would agree to this, “Johnson said earlier.

Britain formally withdrew from the European Union on January 31 of this year. However, in fact, until December 31, it continues to coexist with the EU on practically the same terms.

It was expected that during these 11 months the parties would be able to resolve the controversial issues of their separation and reach an agreement on free trade with each other – in practice, this did not work out.

The three weeks left before the UK’s actual exit from the EU is definitely not enough for the agreement, if it can be reached, to be approved by the parliaments of all EU member states.

What threatens “hard Brexit”

If no agreement can be reached, Britain and the EU will switch to trade on the terms of the World Trade Organization, that is, with tariffs and quotas.

The average EU tariff on imports of grain, vegetables and fruits from countries with which the union does not have free trade agreements is 11.1%, for meat – 15.7%, and for dairy products – 35.4%.

Britain’s huge auto industry could be subject to 10 percent tariffs, amounting to around 5.7 billion euros per year. But this, of course, does not mean that British car factories will lose these 5.7 billion euros: with cars that, due to duties, will be about three thousand euros more expensive than European ones, they may lose the entire market.

The main component of the British economy is the service industry, including financial.

Because of Brexit, the City of London is completely at the mercy of Brussels: if the financial institutions of the EU countries have enough licenses in their country to operate on the entire European market, then the European Commission allows foreigners access to the EU market at their discretion, on the basis of the so-called “equivalence” (third country rules to EU rules), and may revoke authorization.

True, the British hope that the City is too important for the financial stability of all of Europe to “cut off” it from the market, and the European Commission, in fact, has already given some British-based financial institutions the right to operate on the continent in advance – precisely for these reasons.

Bank of England Governor Andrew Bailey said on November 24 that in the long term, breaking with the EU without an agreement could cost Britain even more than the coronavirus pandemic.

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