EU, Britain divided on trade but search for compromise

Both sides' positions appear irreconcilable but talks taking place to find a way forward

Just over a week after Britain left the European Union, both sides are engaged in grandstanding, staking out extravagant and unrealistic claims about the conditions which will govern their future relationship.

Yet, behind the scenes a more productive discussion is taking place, with both desperately searching for new approaches to a relationship for which there is no legal precedent.

Britain's future trade arrangement with the EU is the first priority, partly because this is the most complex challenge, but also because the negotiations over a future trade deal operate under a very tight timetable.

According to the schedule agreed between London and Brussels, all the trade talks must be concluded by the end of the year, when the current transitory arrangements, which allow both sides to trade as though no separation had taken place, expire.

In practice, the timetable is even shorter, for the trade talks are being launched only early next month, and have to conclude by November at the latest, since 28 various national Parliaments will need to ratify the deal.

And the gap between the sides is huge.

The EU naturally wants Britain to sign up to all its regulations and standards, if it is to agree to a broad free trade deal which includes manufactured goods, services and food.

In a 33 page-long policy paper released this week, Mr Michel Barnier, the EU chief negotiator, pointedly refers to the need for Britain to keep its trade regulations in lockstep with Europe. The objective, he says, is "the existence of robust provisions ensuring a level-playing field, guaranteeing competition between economic operators from both sides".

But the British reject this approach. In a speech at the start of the week - pointedly delivered in the historic rooms in Greenwich outside central London, the same location from which the commanders of the British fleet planned the defeat of European powers in past centuries - Prime Minister Boris Johnson rejected the need for Britain's formal acceptance of all EU rules and regulations, by claiming that Britain could follow EU regulations without actually accepting them.

"There is no need for a free trade agreement to involve accepting EU rules on competition policy, subsidies, social protection, the environment, or anything similar, any more than the EU should be obliged to accept UK rules. The UK will maintain the highest standards in these areas - better, in many respects, than those of the EU - without the compulsion of a treaty," he said.

Mr Johnson is reluctant to accept EU rules because he is under immense pressure from his anti-European MPs to cut any links with the European Court of Justice, the EU's highest court, which frequently rules on whether countries violate trading regulations; removing the jurisdiction of this court is seen by many British politicians as the ultimate declaration of independence from Europe.

What Mr Johnson would prefer is to give an informal British undertaking that the country's trade rules will never be inferior to those of the EU. Mr Johnson would also like to set up a special arbitration tribunal outside EU structures to resolve any future trade disputes.

But for the EU, which operates with strict regulations and established procedures, proposals such as these remain anathema, and it is difficult to see where the compromise will lie.

Besides that, there is also the thorny question of continued access to Britain's very rich territorial waters for EU fishing ships. The British government is determined to keep EU fishermen out, and this, too, has become an early sticking point between the two sides.

Yet, while trade talks appear tricky, there are tentative proposals for possible cooperation frameworks in other areas.

Mr Tom Tugendhat, the MP who chairs the Foreign Affairs Committee of the British Parliament, is pushing for the conclusion of a new bilateral security alliance treaty between Britain and Germany, similar to the one Britain already has with France, the other leading European military power.

And Mr Manfred Weber, the leader of the group of centre-right parties represented in the European Parliament, has penned a letter with colleagues from other EU member-states suggesting the creation of a new joint assembly between the British and European Parliaments in order to "provide the best opportunity to make sure the EU and the UK would remain close partners in the future, in the interests of our citizens".

For the moment, both sides prefer to present their opening positions in uncompromising terms; the discussions are expected to be arduous.

However, now that the separation is an accomplished fact, emotions have cooled down on both shores of the channel.

And although the positions of the negotiators appear irreconcilable, the room for compromise is probably greater than either side is currently prepared to admit.

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A version of this article appeared in the print edition of The Straits Times on February 08, 2020, with the headline EU, Britain divided on trade but search for compromise. Subscribe