Brexit talks likely to descend into ‘fist-fighting’, says ex-ambassador

Brexit talks likely to descend into ‘fist-fighting’, says ex-ambassador

Negotiations to leave the European Union are likely to descend into “name-calling” and “fist-fighting” before any agreement can be found, the UK’s former ambassador to the EU has warned.
Sir Ivan Rogers, who quit in January after telling Prime Minister Theresa May that Brussels diplomats thought it might take 10 years to reach a deal, said there was a “humongous” amount of work to do in what would probably be the country’s largest ever negotiation.
Sir Ivan told the House of Commons European Scrutiny Committee that he did not leak his advice to Mrs May, which sensationally became public ahead of a key European Council summit in December.
“I never leak, I never have, I never would,” said the diplomat. “I can categorically deny and rebut that.”
Sir Ivan denied that he had ever said that he personally believed a post-Brexit trade deal would take 10 years.
But he said his private memo to Mrs May detailed the “street wisdom among the senior players” in Brussels and EU capitals, who thought trade negotiations would not start until late 2017 at the earliest and would not be concluded and ratified until the “early-mid 2020s”.
Sir Ivan told the cross-party committee the separate talks on withdrawal from the EU and Britain’s future trading relationship with its former partners would be “an unprecedentedly large negotiation covering large tracts of Whitehall … on a scale we haven’t experienced probably ever and certainly since the Second World War”.
He added: “This is going to be on a humongous scale. We are going to have enormous amounts of business running up various different channels and then involve difficult trade-offs for Her Majesty’s Government and difficult trade-offs for the other 27 on the other side of the table.
“Obviously, I would expect us and the 27 to be coming at this from very different angles and with very different objectives, but negotiations ultimately only culminate in deals if there is a determination on both sides of the table to make progress.
“That involves generating a momentum and generating an atmosphere so that even when we get into name-calling and an extremely feisty atmosphere – and we undoubtedly will in both exit negotiations and future trade and economic negotiations – there is still an atmosphere to proceed and finalise agreement.”
Sir Ivan said the UK and EU were currently in a “phoney war situation” and could be expected to make “pious” pronouncements at this stage about the need for agreement on free trade.
But he warned that talks “usually end up in a fairly mercantilist fist-fight” before finally resolving themselves in a deal of some sort.
Senior insiders in Brussels and other EU capitals universally believed the process of negotiating a free trade deal and getting it ratified by the European Parliament and national and regional assemblies across the continent would take until “the early-mid 2020s”, he said.
“I never used ’10 years’,” he said. “What I did – which I think is what ambassadors are partly there for – is to report what I was getting from the most senior voices around Brussels.”
He added: “I have been saying to people it is possible to go much faster with the UK.”
Sir Ivan said he had “no doubt” that the UK will be able to negotiate trade deals with non-EU states more swiftly after withdrawal.
“One of the key cases for leaving is the nimbleness and agility we would have (when) not a member state, on our own, to negotiate at speed with only our own priorities on the table,” he told MPs.
“I have no doubt that we will negotiate FTAs (free trade agrements) with other partners outside the EU faster than the EU can do it. No doubt at all.
“The question is then the negotiating heft you have at the table in comparison with being part of a wider bloc. The advantage of being in the EU is not speed or nimbleness …. it is the size of the market. Why are the Canadians or South Koreans or others interested in the EU market? It’s the size and scale.”
Sir Ivan predicted that details from the negotiations are likely to be copiously leaked during the two-year process of withdrawal under Article 50 of the EU treaties.
Sir Ivan said reports that Brussels officials were preparing an “exit bill” of 40 billion to 60 billion euros (£34 billion-£51 billion) for the UK were “genuine”.
He said senior EU figures believe the costs of crashing out without a deal are so great that Britain cannot afford to refuse.
“The view of many will be that the implications for the UK of walking away without any deal on the economic side and without any preferential arrangement and walking into a World Trade Organisation-only world are – from their perspective, which may be a misreading of us – so unpalatable that we won’t do it,” said Sir Ivan.
From the EU’s point of view, UK withdrawal will “explode a bomb” under its seven-year budget, costing poorer countries as much as 10%-12% of the structural funding they receive from Brussels and putting richer states like Germany and France under pressure to make up the shortfall.
Although each of the 27 states will have its own interests and priorities in negotiations, “one thing they can all agree on is that we are the rogues who have ceased to pay our dues”, he said.
An exit payment can be expected to be a major priority for the EU side in negotiations, alongside the rights of EU citizens living in the UK, the relocation of EU agencies based in Britain, the status of international treaties signed by the EU on the UK’s behalf and transitional arrangements for a new relationship.
Sir Ivan backed the Government’s position that future trade relationships must be negotiated alongside the withdrawal, but he warned that most EU figures thought the Brexit deal must be concluded before talks on trade.
The former permanent representative said departure from the single market would mean the UK financial services sector losing “passporting” rights to operate in the rest of the EU.
One of Britain’s priorities must be to persuade the other 27 that “it is not in their interests to cut off their own noses” and that they should offer an “unprecedented” deal allowing UK financial services businesses wide-ranging market access, he said.
Sir Ivan said the EU was likely to demand payments from the UK for pensions for officials who served in Brussels during its membership of more than 40 years.
The other 27 countries might say “your liabilities don’t cease … you can’t just walk away from your liabilities and say you have no liabilities after 2019”, he said.
And he told the committee: “I’m not saying this is right or wrong. I think there will be a lot things the other side will argue that will be profoundly wrong and will be trying to present us with a much larger bill than we would ever want to pay or think legally justified.”
International Trade Secretary Liam Fox dismissed the suggestion the UK could face a bill from the EU as “absurd”.
He told MPs on the International Trade Select Committee: “I find it bizarre because the UK is using a legal power that we have under the Lisbon Treaty, a provision that was freely entered into by all our European partners.
“Why should they then turn round to say that we should pay their costs for a process that everybody equally entered into at the time? So it seems to me an absurd argument.”

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