The pound has been under the spotlight lately, and it’s not just because of the upcoming elections. Here are Brexit-related updates you need to know about:
Conservative Party released its manifesto
Last week Prime Minister Theresa May and her Conservative Party launched a manifesto that paints a picture of what a Tory-led Britain would look like.
The 88-page manifesto also gave us glimpses of what May’s stance on Brexit would look like:
The Conservative Party is happy that leaving the EU would allow the U.K. to “reduce and control the number of people who come to Britain from the European Union, while still allowing us to attract the skilled workers our economy needs.”
No grey lines about staying in the single market! In the document, May’s party noted that “As we leave the European Union, we will no longer be members of the single market or customs union.”
Instead, May will seek a “deep and special partnership including a comprehensive free trade and customs agreement” and “strike trade deals with old friends and new partners” around the world.
Paying the EU
The party isn’t that averse to loosening its purse strings to get out of the EU. In the manifesto, the party noted that “There may be specific European programmes in which we might want to participate and if so, it will be reasonable that we make a contribution.”
It’s also willing to negotiate, sharing that “We will determine a fair settlement of the UK’s rights and obligations…in accordance with the law” but warned that “the days of Britain making vast annual contributions to the European Union will end.”
Recall that Chancellor Philip Hammond has threatened to turn the U.K. into a tax haven if the EU squeezes Britain out of the single market.
Seems like the Conservatives have already started as they pledge to lower Corporation Tax to 17% by 2020 to “help to bring huge investment and many thousands of jobs to the UK.”
Britain ready to “walk away” from negotiations?
Over the weekend, Brexit Secretary David Davis warned that Britain will walk out of Brexit talks if the EU sticks to the €100-billion price tag for leaving the union.
If you recall, the EU is demanding the U.K. to fulfill its monetary obligations – which includes farming subsidies and EU administration fees – as part of its conditions to exit the union.
European Commission (EC) President Jean-Claude Juncker suggested it was €60 billion back in February, while other analysts think it could go as high as €100 billion. Unfortunately, Davis thinks even “£1bn as a lot of money.”
Davis also sees negotiations becoming “fairly turbulent” as he would reject a schedule that would require discussing issues such as citizen rights and Northern Ireland’s borders before getting to the trade deals part.
He shared that “The first crisis or argument is going to be over sequencing.”
In an interview with The Sunday Times, he also threatened that “We don’t need to just look like we can walk away; we need to be able to walk away.” Yikes!
The European Commission just published its Brexit mandate
After a two-hour meeting in Brussels the EU member states have drafted a more detailed plan for Brexit talks, which Chief negotiator Michel Barnier said will commence “very quickly after the election.”
Here are takeaways from the EC’s 18-page release:
Michel Barnier is the official EU27 negotiator
His nomination was already welcomed by the European Commission – the EU’s official negotiator – back in December, but Barnier just officially became the Chief Negotiator for the EU27 last Monday.
Official date for Britain’s exit
The EC wants the agreement to specify the U.K.’s official exit at 00:00 on March 30, 2019 at the latest, unless both the EC and the U.K. decide to extend the period in accordance with Article 50 of the Treaty on the European Union.
3 priorities for the “first phase” of negotiations
The EC wants to tackle three main issues before moving forward with any other discussions:
Rights of U.K. and EU27 citizens
The EC wants effective, enforceable, non-discriminatory and comprehensive guarantees that protect “the status and rights of citizens – EU27 citizens in the UK and UK citizens in the EU27 – and their families.”
Specifically, it wants the agreement to detail the definition of the persons as well as the rights covered by the agreement.
Financial settlement of the UK’s obligations
The EC wants “a single financial settlement” that (1) respects the EU and U.K.’s obligations resulting from the U.K.’s membership, (2) contains a schedule of payments, and (3) is priced in euro.
New external borders of the EU
Just like in any divorce, the EC wants to detail how the EU and the U.K. will divvy up their assets.
This includes the movement of goods and services placed in the markets before the Brexit, its law enforcement cooperation procedures, and rights and ownership to output from European organizations such as the European Atomic Energy Community.
Transparency policy for Brexit negotiations
The EC detailed that “documents which are shared with EU Member States, the European Council, the European Parliament, the Council, national parliaments, and the United Kingdom will be released to the public.”
These include (but are not limited to) agendas for negotiating rounds, EU position papers, non-papers, and EU text proposals.
First official negotiations to start a week after the U.K. elections
In a presser yesterday, EU27 Chief negotiator Michel Barnier shared that he expects first official Brexit talks with London to start on Monday, June 19, a few days after Britain holds its elections.
Barnier emphasized the importance of tackling the rights of citizens as well as financial settlements first, stating that “We will need to make sufficient progress on this first phase if we are to move to phase two as quickly as we can at the end of this year and the beginning of next.”