European capitals are firmly against key elements of the model for post-Brexit relations which Theresa May is seeking to negotiate by the autumn, Britain’s former top diplomat in Brussels has warned.
Sir Ivan Rogers said British hopes of finding a technological solution to keeping the Irish border open were regarded as “a fantasy land unicorn model” in Europe.
He said Brussels had already signalled a “clear and unequivocal No” to Mrs May’s hopes for so-called “ambitious managed divergence”, which would allow the British to follow EU regulations in some areas and write its own rules in others.
On the UK’s plea for mutual recognition of rules in financial markets – rather than the EU model of “equivalence” which would allow Brussels to decide whether the City of London was living up to its standards – he said: “I’ve heard any number of reactions from Berlin and Paris and Brussels which say ‘No, no way, never, Hell will freeze over”.
Sir Ivan quit as UK permanent representative at the EU in January last year, warning of “muddled thinking” over Brexit by UK politicians.
He told the Policy Exchange think tank on Thursday that London was still not approaching the negotiations with the “sophistication” of Brussels.
In the political agreement on the future relationship which is due to be sealed in the autumn, he predicted the EU will demand a “level playing field” with the UK on state aid rules, competition and mergers policy, tax policy and environment policy.
If Mrs May insists on the right to converge in these areas – which many Brexiteers regard as vital if the UK is to reap the rewards of EU withdrawal – the response from Brussels will be “sod off with your trade deal”, he forecast.
This would leave the UK with, at best, a basic free trade agreement similar to Canada’s, which would be “goods rich and services light (and) will screw the UK economy on services”, he said.
He dismissed hopes that a trade deal of any kind could be completed quickly with Brussels, saying: “The legal agreements will run to thousands of pages. It will not be a quick and dirty trade deal. There’s no such thing with the EU.”
He poured cold water on expectations of a major boost to the UK economy from new bilateral deals with giants outside Europe like the US, China and India.
“With the best will in the world, if you tot all of them up and think you can do all of them and implement them and think they have a big hit rate over the next 10 years, they don’t add a lot of quantum to the UK economy,” said Sir Ivan.
Deals which slash tariffs on agricultural products, as some Brexiteers advocate, could have negative effects on some of the poorest rural communities, he warned.
“The people who will suffer most from agricultural liberalisation will not be consumers – they will benefit from it – but will be producers, above all in the poorer areas of the UK and above all in the hillside regions,” said Sir Ivan.
“That’s Scotland and that’s Wales and that’s Lakeland hills. The fine agriculture of south-east England will be fine and competitive at world market prices, but a hell of a lot else won’t be.”