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Stalled Brexit talks pile pressure on May to negotiate deal

Sep 01 2017 09:50
Bloomberg: Robert Hutton and Ian Wishart

London - After a third round of Brexit talks ended in acrimony, the moment could be approaching when national leaders have to step in and break the deadlock. The question is whether Theresa May has the skills to do it.

Colleagues and counterparts who have dealt with her over the years attest to May’s ability to be stubborn - "By God it was hard work," former Deputy Prime Minister Nick Clegg said last year when asked about negotiating with her - but getting agreement will require flexibility as well as toughness.

On Thursday the European Union’s negotiator, Michel Barnier, said the talks still had done nowhere near enough for there to be a prospect of moving on to trade discussions after October.

The big sticking point is money - how much the UK is prepared to pay toward commitments the European Union (EU) has made on the assumption of continued UK membership.

This is the sort of gridlock where heads of government have more latitude than appointed negotiators, so it’s possible progress could be made around the table as early as an EU summit on October 19. That may even be the plan of British negotiators who have steadfastly refused to reveal their positions - even behind closed doors - and may be intentionally stringing things out until that date, say people familiar with how the talks are progressing in Brussels.

'What it ultimately will come down to is a crunch summit at which key players will have to make decisions on what’s acceptable," said Craig Oliver, once-Prime Minister David Cameron’s former director of communications, in an interview. "Don’t underestimate the extent to which leaders don’t focus until the last minute."

Oliver is also quick to point out that most leaders don’t allow their concessions to happen until very late in the game. That means May needs to bolster her weakened position with a much-anticipated Brexit speech in September and bring Conservatives in line at her party conference in October.

Grand bargain?

The prime minister may hope the summit offers her the chance for a grand bargain. If she can bring into the discussion potential future payments to the EU as part of a transition deal that gives the UK continued access to the single market, she might manage to settle the bill issue and start talks on the future in one fell swoop.

Her Brexit emissary, David Davis, dropped heavy hints on Wednesday that the UK wants to tie what it owes to a transitional agreement: "Settlement should be in accordance with law and in the spirit of the UK’s continuing partnership with the EU."

In diplomatic speak it amounted to an admission that payment by the UK is contingent on getting something in return.

EU diplomats in Brussels say that while they’re aware of this as a possible UK tactic, it would take a huge shift for it to work. The 27 other members of the EU generally believe they have the upper hand and see no need to change their approach to suit the British.

Trade Secretary Liam Fox, on a visit to Japan with the prime minister, was more outspoken accusing the EU of attempting to "blackmail" Britain by blocking trade talks until the exit price is agreed.

"We can’t be blackmailed into paying a price on the first part," Fox told ITV News. "We think we should begin discussions on the final settlement because that’s good for business, and it’s good for the prosperity both of the British people and of the rest of the people of the European Union."

Raise your game

May is under pressure at home with Parliament back from recess next week. While many in her party oppose large payments to the EU as part of the divorce, there are enough pro-EU Tory lawmakers to harm her.

A cross-party group on Friday published a report outlining ways the UK economy will be harmed by leaving the customs union.

“The prime minister and her cabinet have got to raise their game,” London Mayor Sadiq Khan told Bloomberg Television. A member of the opposition Labour party, he said “there’s a good deal here to be done as long as we act with goodwill."

To be successful at a summit May would need to be nimble and persuasive. But this year’s election showed how the prime minister struggles to think on her feet. Her tendency to return to lines that were prepared earlier rather than shift position earned her the nickname "Maybot."

Then there is her discomfort in social situations. "She’s not a people person," said Rosa Prince, May’s biographer, describing the endless anecdotes that those who had dealt with May recounted of awkward lunches and meetings.

The election also had a deep impact on May’s authority. Having called it specifically to secure a mandate for her EU exit strategy, she came out of it a diminished figure. The effect on Brexit has been clear over the summer.

Members of her Cabinet have publicly debated the best strategy with little reference to the prime minister. In October May will learn whether EU leaders sitting around the table think she has the stature to last the distance and make things happen.

According to Prince, May’s own self-confidence has taken a knock: "She’s not the Theresa May she was. The psychological shock of what happened in the election damaged her."

A belief in herself will come into play. While negotiations at leader level are a way to work past problems, they are daunting occasions.

In 1991, during talks in the Dutch city of Maastricht, then-Prime Minister John Major hid his ambassador under the table so that he could listen in and pass on notes telling his boss what to say.

Happily for all, the advent of instant messaging means May has easier ways of seeking advice.

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world economy  |  brexit

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