The Straits Times says

Hard road lies ahead to Brexit

Britain was geographically linked to Europe some 450,000 years ago, before the waters rose - perhaps because of the melting of the ice sheet - which resulted in "Brexit 1.0", as coined in a headline in the British press. In modern times, reconnecting Britain to the continent via the Channel Tunnel took six years and billions of pounds - 80 per cent more than expected. The costs of Brexit 2.0 should also not be underestimated, as signalled by the Europeans. The partners will now have two years to arrange the political and economic divorce, following British Prime Minister Theresa May's notice to European Council president Donald Tusk of her nation's intention to trigger Article 50 of the Lisbon Treaty. Since this isn't by mutual consent, the results could be messy.

Britain, whose principal external market is continental Europe, should know that it is not approaching the looming negotiations from a position of strength. Choosing what is described as a "hard Brexit", while displaying a bit of the British bulldog spirit, Mrs May has demanded that, contrary to the EU charter, talks on a post-Brexit trading arrangement run parallel to the separation negotiations. Britain also looks poorly on the €60 billion (S$89 billion) or so the EU expects it to remit for keeping its previous commitments to the union. It thinks its liability should perhaps be half that sum. What is clear is that the road ahead will be rocky. German Foreign Minister Sigmar Gabriel and his boss, Chancellor Angela Merkel, have made clear that this will not be a walk in the park and that Britain will have to settle its exit bill before discussing future trading arrangements.

Britain needs to have a conversation with itself before it sits down with the EU. The drop in sterling's traded value, easing real estate prices, the steady movement of jobs from the financial district to elsewhere in Europe - hallowed Lloyd's was the most recent to announce a shifting of some staff to Brussels - are all signals that London risks its position as the centre of the financial world. It is not for nothing that London now has the world's busiest airport system. Further, Scottish leaders are already talking about asking for a second referendum on the question of their continued participation in the United Kingdom. Without a common vision for itself and its relationship with Europe, a botched Brexit looms.

Just about everyone in Asia - from the giant economies of China, Japan and India to others such as Singapore - had long counselled Britain to stay in the EU. Now that the turkey has got the Christmas it cried for, it is no doubt tempting for Europeans to pluck as much as they can from the British. However, it is prudent to not be vengeful but to find ways to repair whatever damage Brexit causes trading systems. Politics must not upend the economic wisdom of concluding an early and equitable accord with the wantaway isles.

A version of this article appeared in the print edition of The Straits Times on April 08, 2017, with the headline 'Hard road lies ahead to Brexit'. Print Edition | Subscribe