Brexit starting blocks | Financial Times


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Ursula von der Leyen visits London this morning to prepare the ground for marathon negotiations that will need to be conducted at sprint speed. 

A spokesman for the European Commission said that future relationship talks between the EU and UK will not begin on Thursday in Downing Street. Instead, the two leaders “will look forward to the year ahead in all of its dimensions”.

But behind the black door, each leader will bring a reality check for the other. Ms von der Leyen will emphasise the impossibility of having a complete future partnership in place by the end of this year, when Britain’s post-Brexit transition period expires. She will also redouble warnings that there will not be any deal unless Britain accepts a stringent level playing field of regulatory standards. 

Mr Johnson also has some clear messages for Brussels. Both Ms von der Leyen and Phil Hogan, her trade commissioner, have in recent days questioned whether the prime minister will stick to his refusal to prolong Britain’s post-Brexit transition period beyond the end of 2020.

Mr Johnson will emphasise that the deadline is the deadline (not least because extending it would require Britain to hand over more money to the EU).

While the high-level diplomacy is in full swing in London, the grunt work will intensify in Brussels. 

Officials from the EU’s remaining 27 countries will on Wednesday hold the first seminar on the future relationship talks — the start of a series of meetings that will fill up their diaries for the next couple of weeks. The near-daily sessions will cover everything from criminal justice co-operation to trade and common defence.

Time is of the essence, given that Brussels wants the EU to be ready to begin negotiations with Britain on March 1.

Officials said that the seminars would be an opportunity to set priorities for the negotiations. They will also delve into the practical challenges of maintaining crucial co-operation with a country that will be outside the entire EU system.

One difficult area is security and defence, where the EU and UK will seek to maintain close ties, but Britain will be outside key bodies such as the union’s Political and Security Committee.

Brussels also sees the sessions as a chance to strengthen EU27 unity ahead of testing times.

A particular concern is fish. The EU has made clear that trade negotiations will be imperilled if Britain does not rapidly concede access to its waters for European fishermen, but this is a concern for only around eight countries, among them France. 

The EU is also grappling with what to do if parts of the future relationship cannot be agreed in time. Brussels has mapped out areas where it can take unilateral measures to prevent a breakdown in essential links — such as air transport. Officials have also suggested that market access for services could be an area of ongoing work in 2021. 

The start of the negotiations may only be weeks away, but there is a lot of hard thinking to be done between now and then. 

Chart du jour

Inflation in the eurozone has reached a six-month high. Still, the European Central Bank has largely failed to achieve its primary objective of price stability, defined as a rate of inflation “below but close to 2 per cent”. This has led the new ECB president, Christine Lagarde, to launch a strategic review of the ECB’s monetary policy. But before analysing any proposals, the central bank must better understand the reasons why it systematically missed its target over the recent years. (FT)

European round-up

Digital tax fight
France and the US have given themselves two weeks to resolve a bitter trade dispute over a new French digital tax targeting big technology companies such as Google and Amazon. Bruno Le Maire, the French finance minister, said both countries had “agreed to redouble the effort in the coming days to find a compromise on digital tax in the framework of the OECD”. (FT)

Win for Sánchez 
Pedro Sánchez has become the first leader in modern Spanish history to head a coalition government. He portrayed the new government as a break with four years of political instability in which Spain held four general elections and lacked a strong government. “There are only two options: either a progressive coalition or a continuing impasse for Spain,” he said. (El País)

Iran stampede deaths
Foreign ministers from the UK, Germany and France met in Brussels for emergency talks on the Iranian crisis as more than 50 people were killed in Iran in a stampede on the fourth and final day of the funeral proceedings for military commander Qassem Soleimani. Soleimani’s assassination in targeted American air strikes last week has pushed the Islamic Republic to the brink of an all-out conflict with the US. (FT)

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