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11 May 2017

Bloomberg: UK needs to wake up to Brexit dangers, top EU lawmaker warns

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Danuta Huebner, head of the European Parliament’s constitutional-affairs committee, said the British government is underestimating the difficulties of its upcoming talks on leaving the 28-nation EU and the cost of life outside the bloc.

“There is a creation of expectations that might not be fulfilled,” Huebner, whose EU parliamentary committee will recommend whether the whole assembly should endorse any Brexit deal, said in an interview in her 12th-floor office in Brussels. “These are going to be extremely difficult negotiations.” [...]


Huebner, a veteran EU policy maker from Poland, said U.K. governments have traditionally shown a detachment from the bloc that has left them less aware about how it works. May’s administration is no exception, with the difference being that the stakes for Britain are higher than ever, according to Huebner.

“It’s never too late to understand what you are going to lose,” she said. “I hope it will be a learning process, which of course might make some people rethink the whole thing.”

The Brexit talks will upend the traditional approach to international negotiations by tackling the most difficult issues at the start rather than at the end, according to Huebner, who was a European commissioner for five years before being elected to the EU Parliament in 2009. [...]

The EU decision -- as soon as October -- on whether sufficient progress has been made in these three matters to meet May’s demand for parallel talks about the U.K.’s future trade relationship with the bloc will be “political,” according to Huebner, 69, who belongs to Europe’s Christian Democratic party.

She said possible transitional arrangements to maintain the status quo after the U.K. departs in 2019 and before any post-Brexit agreement enters into force will require the British government to continue accepting the role of the EU Court of Justice in upholding the rules of the single market.

May has sent mixed signals on this legal point, which is politically sensitive in the U.K. and in her Conservative Party given the push to regain sovereignty. Huebner said Britain’s EU partners have significant leverage here.

“It’s the U.K. who needs transitional arrangements” so as “not to have on the cutoff date the end of everything,” she said.

An economist by training, Huebner said analyses of Brexit’s impact on the U.K. economy have tended to show “too much optimism.” She said such studies have focused on the country’s performance since the June 2016 referendum vote to leave rather than on the longer-term consequences of the actual departure from the European single market created 25 years ago to deepen EU integration.

Almost half of British exports of goods and services goes to the rest of the EU.

“Leaving the single market means eliminating the most powerful driver for growth and competitiveness and employment that the U.K. has had since 1992,” Huebner said. “There is close to a myth in the U.K. about how well they are doing, how competitive they are. There is this pride of being imperial.”

The U.K.’s permanent post-Brexit relationship with the EU may be determined through several agreements, including one on trade and another on financial services, she said.

“I think we will have a separate financial agreement,” Huebner said. “I don’t think it can be within trade.” [...]

Full article on Bloomberg

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