Now that Brexit is ‘done’, what happens next?

A week ago, the United Kingdom left the European Union after membership of 47 years. In a practical sense, nothing changed because we now have a transition period but, in an emotional sense, everything changed because – depending on your point of view – either we took back or control or (my view) we stupidly cut ourself off from a huge market and a family of nations.

In the hours running up to Brexit, I was at the London School of Economics for a panel session on Brexit involving five expert commentators. A major theme of the evening was that Brexit is far from ‘done’; this is just the beginning.

The Government has talked about this being “an implementation period” but, as one panellist put it, “There is absolutely nothing to implement”. The theory is that we now have a year to negotiate the details of our future relationship with the EU , mainly trade but lots of other issues ranging from fisheries to security.

In reality, all of this month will be involved in the two parties determining their respective negotiating positions and negotiations themselves will not begin until the start of March. The transition period concludes at the end of December, but any deal has to be approved by 32 EU national and regional parliaments which means that any agreement will need to be available by September.

That means that, in truth, there will be a mere seven months to negotiate any agreement. Of course, in a rational world, there is an option of extending the transition period by up to two years, but the Government has ruled this out and, if it was to change its mind, it would have to do this as early as July.

The Government appears to favour something like the EU agreement with Canada. But a Canada-type deal is not on offer from the EU and it does not cover many areas such as energy and financial services. Another option mooted by the Government is a so-called Australia-type deal. But there is no such deal since negotiations between the EU and Oz are still in progress.

If there is no deal, the theory is that we fall back on the terms provided by the World Trade Organisation, but these are minimalist terms and would not cover major sectors such as energy and aviation.

Ivan Rogers, a former UK Permanent Representative to the EU, said “There’s big trouble ahead” and forecast “a major crisis in late 2020”. My guess is that, at the very last moment, a deal will be done but it will be what Rogers called “a skinny deal” leaving a mass of detail still to be sorted out.

Brexit is far from ‘done’. This is going to run and run and run.



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