Brexit Update!

2019-09-19 16:00    HotForex
Brexit Update! Institution Opinions
UK

The French and Finnish prime ministers have told the UK government to put forward detailed written proposals for alternative arrangements intended to mitigate the need for an Irish border backstop, which has been the major sticking point of Brexit, by September 30 or talks will be “over.”

As some political media pundits have been pointing out, EU time frames and deadlines have a history of being flexible; the 30-day period stated by Germany’s Merkel for UK PM Johnson to deliver proposals, for instance, expires on Friday. The Finish PM, it should be noted, currently holds the rotating presidency of the EU, so the new deadline may have some weight.

It has become apparent lately that Johnson, famous for bluster and while a leading champion of the Brexit cause is not a true ideologue (like Brexit Party leader Nigel Farage), is in fact quite serious about a getting a deal. Talks have been ongoing between the UK government and Brussels, and the EU is aware of the broad outline of Johnson’s proposals, though details and written documents have been lacking so far.

Sources cited on BBC radio say that Johnson believes that it has just one shot at getting a deal approved by Brussels, and believes that presenting them in mid October, either at or just ahead or at the October-17 summit, would be a better tactic than presenting them earlier. The problem for Johnson is that he has to strike a deal by October 19 before legislation that would delay Brexit until January 31 kicks in.

The outline of the UK government’s proposals is understood to include an agri-food customs arrangement between Northern Ireland and the EU and a high-technology solution for other goods passing through the border (which apparently would take three years to implement, so there would be a lengthy transition phase).

Whether these proposals would satisfy the EU’s demands of maintaining the integrity of the single market and the Good Friday Peace Agreement will be the major questions.

 

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Andria Pichidi

Market Analyst

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