Liam Fox, UK international trade secretary, arrives for a meeting of the Brexit War Cabinet at number 10 Downing Street in London, UK. (SIMON DAWSON / BLOOMBERG)
Prime Minister Theresa May’s ministers are ratcheting up warnings that Brexit talks risk ending in failure, with International Trade Secretary Liam Fox on Sunday predicting a messy split from the European Union.
The UK government has increased the pressure on the EU in recent weeks. Part of the UK strategy involves giving greater visibility for no-deal planning
“The intransigence of the commission is pushing us towards no deal,” Fox told the Sunday Times. “We have set out the basis in which a deal can happen, but if the EU decides that the theological obsession of the unelected is to take priority over the economic well-being of the people of Europe, then it’s a bureaucrats’ Brexit - not a people’s Brexit,” and “there is only going to be one outcome.”
The UK government has increased the pressure on the EU in recent weeks, urging the bloc to loosen its red lines and come to an accommodation over Brexit. Part of the UK strategy involves giving greater visibility for no-deal planning.
Fox said there’s now a 60 percent likelihood of a no-deal outcome as the clock ticks down to Britain’s scheduled departure in March. It follows a warning last week by Foreign Secretary Jeremy Hunt that “we potentially face the prospect of a no-deal by accident,” and comes as the government steps up no-deal preparations.
May’s office said it’s “confident” of striking a deal, while Brexit Secretary Dominic Raab told France’s Les Echos on Friday that he sees no alternative to striking a deal.
Preparing for no-deal
The prime minister has said she plans to publish some 70 technical notes in August and September outlining contingency plans for different sectors in the event Britain tumbles out of the bloc without a deal.
“It’s essential that ‘no deal’ looks credible to the EU,” Fox said. “If our message on ‘no deal’ is becoming more credible and resonating with those we are negotiating with in Europe, then our negotiating hand is getting stronger every day and we shouldn’t do anything to undermine that.”
It’s not a prospect business and markets relish, though. The pound tumbled below US$1.30 on Friday after Bank of England Governor Mark Carney told the BBC that the odds of a no-deal Brexit are were “uncomfortably high.” Aircraft maker Bombardier Inc. on Monday told the Press Association that it may have to stockpile parts at a cost of 30 million pounds (US$39 million) to mitigate for a no-deal Brexit that disrupts trade and supply chains.
Meanwhile, Chancellor of the Exchequer Philip Hammond has warned financial services companies that France is leading an attempt to encumber them with new rules after Brexit that’ll make it harder for them to operate in the EU, according to a report on Monday in the Financial Times. Hammond told a meeting of City executives that while the bloc will initially minimize disruption, it’s likely to pass regulation over time that hampers UK banks, according to the paper.
May hopes to conclude a divorce deal and the broad outline of a future trade agreement by October, giving the UK and European parliaments until Britain’s scheduled departure in March to debate and vote on the package. Ministers have warned the EU its own Lisbon Treaty obliges it to “develop a special relationship” with its neighbors, the Telegraph reported on Monday.
May’s office said in an emailed statement Sunday that while the government is “confident” of securing a deal, “it is the job of a responsible government to prepare for all scenarios.”
May on Friday cut short her holiday in Italy for a meeting with French President Emmanuel Macron. After she finally devised a plan for the post-Brexit economic partnership with the EU last month, Europe’s lead negotiator, Michel Barnier, pushed back against its centerpiece - a proposal for Britain to collect tariffs at EU rates at its borders to maintain a “frictionless” boundary with the bloc.
That’s left May with little room to maneuver, because Brexiteers in her party already say the strategy offers too many concessions to the bloc. Former Brexit Minister David Jones used an article in the Sun on Sunday to condemn May’s plan, enshrined in a so-called White Paper, as “Brexit in Name Only,” or “Brino.”
Another critic of May’s strategy, former International Development Secretary Priti Patel, wrote in the Sunday Telegraph that the plan fails “by any reasonable standard” to reflect the result of the 2016 EU referendum or to “provide for our future economic prosperity.”
“Our negotiating advantages are meaningless without leadership brave enough for the task,” wrote Patel, often touted in the UK press as a potential contender in any future leadership contest to succeed May.
Former Foreign Secretary Boris Johnson, another Tory with ambitions to succeed May, is debating either addressing a rally for Brexit or setting up an organization to promote his leadership credentials in September, the Sunday Times reported. Johnson’s popularity among the party grassroots has risen since he quit May’s cabinet last month because he rejected her Brexit White Paper.