Opinion

Brexit will change millions of lives. Our leaders must do more than posture

From the land border with Ireland to expats’ pension rights, there is much to negotiate.

By: and Date: May 8, 2017 Topic: Macroeconomic policy

This blog post was originally published in The Guardian.

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Brexit negotiations have got off to a bad start: that much at least is clear. The leaking of details about May and Juncker’s dinner conversation was unhelpful. Domestic elections in the UK, France and Germany leave negotiations trapped in a damaging cycle of tail feather-shaking. But it will soon be time to move beyond the absurdities and negotiate on what really matters.

Contrary to the claims of the commission president, English will remain an important language of Europe. And despite accusations by the UK prime minister, the EU is not maliciously meddling in the general election. Rhetorical attacks might seem harmless, but goodwill is a precious resource in these negotiations.

At least the ensuing war of words and public emotion shows that both sides realise just how much is at stake. The truth is that the upcoming negotiations will be incredibly complicated, for both technical and political reasons.

For example, how can we deal with the land border in Ireland? The new arrangements will have major implications for business and trade but also for the hundreds of thousands of people in the north with a passport from the republic. Nearly 20,000 workers commute across the border. These are not technical issues but questions with far-reaching political consequences, including for the peace process.

And Northern Ireland is only one of many such issues, where technical complexity meets political tension. Perhaps most important is the need to reach a deal that defines the rights of expats on both sides. But which rights should these migrants keep? A British citizen living in Spain currently has the right to vote in local elections. Should this be preserved? What about the French student who pays domestic rates at a London university? And how do we process the pension rights accrued by a Polish worker who spends six years in the UK but then leaves? The EU has mechanisms for these situations, and lives were planned around the existing rules.

Whatever the agreement on citizens’ rights, they must be enforceable and protected. So who will watch over them, and what will be the relevant jurisdiction? Theresa May talks of escaping oversight by the European court of justice (ECJ), while the EU wants the ECJ to adjudicate. All of these questions are technically fraught and politically charged, but both sides have repeatedly insisted that citizens’ rights are a priority. So now they must deliver. The UK and European public rightly expect politicians to sort out the mess and minimise the damage to people’s lives.

A second issue is future trade relationships. On a technical level, this should actually be easy to agree. We are not talking about a trade deal between two vastly different economies: on the contrary, the Great Repeal Act will translate the current body of EU law into British law. Thus, on the day of Brexit, standards and regulations will essentially be identical. The questions here are whether either side imposes tariffs, and how to deal with future regulatory divergence. These are standard topics, often negotiated in trade agreements, and they are less complex than the fine detail of migrant citizens’ lives.

With political will, a sensible trade agreement is in reach. A deal that primarily covers goods, rather than investment and services, could easily be passed on the EU side. More elaborate agreements would require unanimity, and the recent near-collapse of the EU-Canada Ceta agreement shows that this can be tricky to achieve. But still, it is in both sides’ interest to avoid a no-deal scenario and a fallback to WTO rules.

A final big issue is the infamous “Brexit bill”. Although economically insignificant, politically this might be the most toxic issue. It is important to understand that even a sum of €60bn would not be at all threatening to the UK’s economic fortunes – it is around 3% of UK GDP, and it would be spread over a number of years. But for politicians the bill is extremely explosive, mostly because of the emotional headlines it will trigger on both sides.

After Brexit, economic and political links between the EU and the UK will be weaker. But the UK will still be the EU’s closest neighbour and an important ally. It is time to discuss in earnest how to soften the damage of Brexit for citizens and business on both sides. And it is time to explore how to structure future cooperation in fighting terrorism. Brexit will not be a success, but aiming for failure serves no one. Goodwill and a sense of perspective are the way to protect the EU and UK alike.


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