Brexit trade challenge in focus as Conservative MPs vote again for leader

British Interior Minister Theresa May leads the Conservative Party race to become the next British Prime Minister.
Conservative lawmaker Andrea Leadsom told reporters that she was 'delighted' to have made 'an-female shortlist' in the Tory leadership race.
Theresa May leaves 10 Downing Street after attending a Cabinet meeting in London, on July 5, 2016.
Theresa May leaves 10 Downing Street after attending a Cabinet meeting in London, on July 5, 2016.PHOTO: EPA

LONDON (REUTERS) – Britain will have to ask “friendly governments” to provide some of the trade negotiators it lacks as it starts the process of extricating itself from the European Union, Foreign Secretary Philip Hammond said on Thursday (July 7).

The acknowledgement underlined the extent to which the government was wrongfooted by last month’s referendum to sever ties with the EU, a process fraught with uncertainty for businesses and investors.

Hammond also said it would be a mistake to start immediate divorce proceedings with the EU, partly because a successor to Prime Minister David Cameron will not be in place until the results of a vote to replace him are revealed on Sept 9. 

Conservative lawmakers were holding a second round of voting on Thursday to select the final two candidates for that ballot.

“For the moment we are not in a position to begin substantive negotiations immediately and therefore it would be unwise to start the process ticking by triggering Article 50,” he said, referring to the legal clause that would launch the process of withdrawing from the 28-nation bloc. 

“The government will have to acquire additional trade negotiation resources ... We will look to friendly governments to assist us, as well as seeking to hire the best resources available on the open market,” Hammond told a committee of lawmakers. He added it was unlikely the government would have a large budget to do so.

Hammond was speaking as Conservative leadership hopefuls Theresa May, Andrea Leadsom and Michael Gove awaited the outcome of the second ballot of MPs, which will decide which two of them should face off in the race for prime minister.

Cameron has said he stepped down after voters, many of them swayed by concerns over high immigration and a desire to reclaim‘independence’ from Brussels, rejected his entreaties to keep Britain in the EU and his warnings that leaving would spell economic disaster.

Investor concerns about the impact of ‘Brexit’ have mounted in recent days, with asset managers suspending trading in commercial property funds worth billions of pounds after too many people rushed to withdraw their money at once.

GRASSROOTS VOTE 

Interior minister May, who has emphasised her experience in one of the toughest portfolios in government, is seen as the front-runner among the leadership candidates.

In a first round of voting on Tuesday, she had the support of half of the parliamentary party, leading Leadsom, a junior energy minister, and justice minister Gove.

But her victory is not guaranteed. Tactical voting may skew the outcome on Thursday, expected around 1530 GMT (11.30pm Singapore), and the two remaining candidates will then compete for the votes of largely eurosceptic grassroots Conservative members, who will have the final say.

That could favour Leadsom or Gove, who both campaigned forcefully for a Leave vote during the acrimonious referendum campaign, while May was in favour of staying.

Leadsom, who entered parliament only six years ago and unlike her two rivals has not served in cabinet, said on Thursday her top priority would be to guarantee tariff-free trade with the EU after leaving.

Against a background of widespread uncertainty, she sought to present herself as the candidate of hope, declaring: “Let’s banish the pessimists.” 

Leadsom has put her 25 years’ experience working in financial services at the centre of her campaign to become leader, having spent a decade working at Barclays Bank and fund manager Invesco Perpetual.

But some of her career credentials are being called into doubt. Reuters spoke to five former Invesco colleagues, including four in senior management positions, who said Leadsom did not have a prominent role or manage client money.

She told the BBC that questions about her career record were“ridiculous” and her CV was “all absolutely true”.

Justice minister Gove, who previously ran the education portfolio, is seen as an intellectual and political heavyweight.

He shocked his party last week by abruptly withdrawing his support for former London mayor Boris Johnson, previously seen as the leadership front-runner, and effectively forcing him from the race.

But Gove’s own ambitions may suffer from what was widely portrayed as an act of political treachery, and after media published past interviews in which he had said he was neither interested in the prime minister’s job nor well suited to it.