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Brexit: A divorce is sealed

After 47 years of sometimes troubled relations, the United Kingdom is leaving the European Union at midnight on 31 January

Manal Lotfy , Thursday 30 Jan 2020
A divorce is sealed
UK Prime Minister Boris Johnson (photo: AFP)
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At the stroke of 11 pm on 31 January (midnight in Brussels), the UK will officially leave the European Union and cease to be a member state. The divorce will be sealed, and Friday will be a point of no return for the UK and the EU.

The moment will be a source of joy and celebration for some, but it will also be a source of pain and despair for others. Nonetheless, no one will notice immediate changes. The UK will enter an 11-month transition period to negotiate a new relationship with the EU.

Nothing will change during 2020, as the UK will be staying in the EU single market, its customs union and paying into its budget. It will also continue to follow EU rules but have no say in making them. The real change on 31 January is legal and institutional. The Article 50 process to leave will be over and non-reversible.

“I think I’ll cry. At 11 pm on Friday 31 January, I will no longer be a European citizen, only a British one. My children and I will not be entitled to reside or work in the European Union countries. We will have to get visas for tourism and freedom of movement will stop. These are the tangible repercussions that we will feel after the transition period ends, and they scare me,” said Kat Robinson, the owner of a small business in the UK making hand-made accessories and organic candles.

She told Al-Ahram Weekly that she was still in the dark regarding importing materials from the European Union after Brexit, since possible new tariffs might affect the cost of what she produces and the competitiveness of her business.

Under the terms of the Withdrawal Agreement from the EU, the UK will enter a transitional period that will allow businesses and government to prepare for new post-Brexit arrangements and prevent sudden changes to trade rules and immigration regulations.

The period will be used to negotiate what the new UK-EU relationship will look like. During the transition period, things will continue as they are now.

EU citizens arriving in the UK and UK citizens arriving in the EU will enjoy the same freedom of movement. The UK will still be part of existing EU trade deals but will be able to negotiate future trade deals with the US and other countries. The UK will also remain in the customs union and single market and will not be subject to special EU regulations.

Security co-operation will continue between the UK and the EU. The UK will still be subject to EU law and the rulings of the European Court of Justice. It will also effectively stay part of the EU Common Fisheries Policy.

But UK citizens will no longer be EU citizens. British passport holders will continue to be able to travel and work in the EU because the country remains in the single market for the transition period up to 31 December 2020, and the freedom of movement of goods, people, services and capital applies until then.

The British government says it wants to reach a trade agreement with Brussels by the end of this year. But experts are sceptical that there will be enough time to conclude a comprehensive deal that goes beyond narrow matters of trade in goods and covers arrangements including science, education, data exchange and security, the latter including approximately 40 EU measures on policing and judicial cooperation.

Michel Barnier, the EU’s chief negotiator, has emphasised that not everything can be done in 11 months. His officials will prioritise some topics ahead of others, likely to be trade in goods, security and fishing rights.

The UK government has the option before 1 July 2020 to ask for an extension of the transition period for one or two years. Even though British Prime Minister Boris Johnson has made this illegal under domestic law, the statute could be repealed if necessary.

However, if the UK government changes its mind and seeks a transition extension after 1 July, the door will be locked. At a private meeting with EU27 diplomats this week, EU lawyers said there could be no extension after 1 July 2020.

Britain thus has to make up its mind and decide before July whether it will need to extend the negotiations or not, otherwise it risks the failure of the talks. This would mean that trade between London and Brussels would take place according to the rules of the World Trade Organisation (WTO).

Beside talks about the future relationship with the EU, the UK government must pass new legislation in four key areas to implement its vision of Brexit, with new immigration laws to replace freedom of movement and new legislation on agriculture, the environment, and trade, all of which are substantially regulated by the EU.

In the queen’s speech before parliament earlier this year, the UK government promised bills on fisheries, financial services and international law.

 

ON THE AGENDA: Top of the list is a trade deal to ensure the tariff and quota-free flow of goods between the EU and UK.

But the EU will only agree to zero tariffs and zero quotas if the UK pledges zero dumping – that is, not lowering social and environmental standards to outcompete the EU.

The negotiators will almost certainly clash over the EU’s refusal to bring services into the trade deal, leaving the City of London reliant on a patchwork of market-access agreements that can be withdrawn at any moment.

Another early fight will be over fish, as the EU seeks to link the trade in goods to maintaining the status quo on access to British waters, a demand seen as outrageous in London.

Even before the start of the talks, tension has been evident. Days after Johnson said there would “emphatically” be no checks on trade across the Irish Sea, the EU rejected his claims that there would be no checks on goods going from Great Britain to Northern Ireland after Brexit.

The EU’s chief negotiator told an audience in Belfast that the UK had agreed to these as part of a “creative and flexible” solution to the Irish border question.

“The text is very precise. I always tell the truth,” Barnier said in response to questions on whether checks could be lifted. When asked how he felt about Johnson’s repeated claims there would be no checks, he replied that “I know what is written in the text,” referring to the withdrawal agreement.

 “I understand the fears of negative economic fallout expressed by some about these checks, but Brexit unfortunately has consequences that we must manage,” he said. He added that it was the UK’s decision to quit the single market and customs union and that this “makes checks indispensable.”

Barnier expressed his perplexity at UK chancellor Sajid Javid’s remark in a Financial Times interview that the UK would not be aligned to EU rules post-Brexit. He said he hoped “our UK friends are reflecting carefully” on the matter because the EU would not agree to a close neighbour trying to seek unfair advantage through subsidies to industry or a removal of stringent standards to cut costs.

“The UK cannot expect high-quality access to our single market if it insists on competing on state aid or social or environmental standards,” he said.

The long road to the new relationship between the UK and the EU has begun, and it may be bumpy and difficult.

The Brexit timetable

- 11 pm on 31 January: The UK leaves the EU under the terms of a deal agreed by UK Prime Minister Boris Johnson. The transition period begins, during which the UK is still in the customs union and single market.

- 25 February: The EU is expected to agree a mandate for trade negotiations with the UK.

- 1 July: The EU and UK aim to agree on fishing quotas for 2021. Deadline for the UK to request a transition-period extension. If extra time is requested, the UK will have a one-year extension by a deadline of 31 December 2021 or a two-year extension ending on 31 December 2022.

If extra time is not requested, the transition period will end on 31 December 2020. New trading relations will begin based on the new trade agreement, but if the UK cannot reach an agreement with the EU, it will trade with the EU on WTO terms.

 

*A version of this article appears in print in the 30 January, 2020 edition of Al-Ahram Weekly.

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