U.K.'s Tortuous EU Exit Is a Lesson to Bloc's Members: Don't Try This at Home
December 15 2019 - 9:29AM
Dow Jones News
By Marcus Walker
As Britain's vote launches the country's exit from the European
Union into a new and difficult phase, the bloc is cementing a top
goal: Halting more EU defections.
The bruising 3 1/2 -year Brexit process has been so negatively
viewed by European voters that even EU-skeptic parties on the
Continent have mostly dropped talk of leaving the bloc or the euro.
Instead, nationalist politicians such as Italy's Matteo Salvini and
France's Marine Le Pen now speak of changing the EU from within
while reassuring voters that their countries will remain in it.
That could change if the U.K. secures a trade deal with the EU
that gives it greater national sovereignty without hurting its
economy and Brexit comes to be seen as a success for Britain. But
the likelihood is that Prime Minister Boris Johnson's new
government will confront painful trade-offs after its EU membership
ends on Jan. 31.
"Perhaps the cloud is lifting a bit, but the U.K. will still
have a steep hill to climb to work out a new economic and political
relationship with its most important trading partner," said Mujtaba
Rahman, head of Europe at political-risk consulting firm Eurasia
Group. "Concluding and ratifying a trade agreement will be very
difficult, and the U.K. will ultimately have to make big
concessions while getting less access than it has now. That will
continue to color people's perceptions in Europe that exit is a
painful process."
Mr. Johnson's strong Conservative election victory means he can
now ratify his divorce agreement. Under the deal, the U.K. will
continue to apply EU laws and regulations until at least the end of
2020, after which a new trade treaty is supposed to be ready.
Without one, economic chaos could follow.
In trade talks, the EU will again use the same bargaining power
over the smaller U.K. it used ruthlessly to limit the U.K.'s
options for its divorce deal. The U.K. could face a tricky choice
between losing vital access to European markets and accepting EU
rules over which it will no longer have a say.
Some Britons who want continued close relations with the EU
complain that the bloc has been driving too hard a bargain in the
negotiations, risking a bitter and lasting alienation of the U.K.,
which remains one of Europe's most important economies and military
powers.
But ever since Britons voted to leave in a June 2016 referendum,
the EU's other 27 countries put another goal above good relations
with London: the bloc's survival.
In 2016, many European political elites feared a great
unraveling of European integration if a wave of populist movements
overthrew the broadly centrist establishment in Western Europe.
After the surprise British referendum result, and President Trump's
election, Ms. Le Pen looked like a strong contender to win the
French presidency. At the time, she spoke of dismantling the euro
and the treaties underpinning the EU.
Germany's political elite feared that losing France, its
longtime partner at the heart of European integration, would doom
the experiment.
Smaller EU countries warned German Chancellor Angela Merkel
against being too accommodating toward Britain to avoid encouraging
anti-EU forces back home. Led by Ms. Merkel, EU leaders soon united
around the priority of defending the bloc and preventing Brexit
from setting a risky precedent.
"From the point of view of the worst fears in 2016, the EU's
negotiating strategy has been a success," said Sara Hobolt,
professor of European politics at the London School of Economics.
"They have managed to stay united, and there has been no domino
effect."
The most important part of the EU's tough stance concerns the
long-term economic relationship. The bloc will warn the U.K. that
the more it diverges from EU economic regulations and standards,
the less access it will gain to Europe's large markets for goods
and services. That puts the U.K., which is more dependent on Europe
than vice versa, at a disadvantage.
Failure to reach a trade deal risks battering the U.K. economy.
But agreeing to one will likely require Mr. Johnson to accept a
"level playing field" of economic regulations. That could reassure
business but anger lawmakers and voters who want a radical break
with the EU.
The form that Brexit takes could also test the U.K.'s
territorial integrity over time. Mr. Johnson's divorce deal leaves
the U.K. province of Northern Ireland inside the EU's customs union
-- but facing customs controls vis-à-vis mainland Britain.
Thursday's U.K. elections were also a victory for Scottish
nationalists, who want to leave the U.K. and stay in the EU.
What's more, the U.K. must also renegotiate many economic
relationships with the rest of the world that were previously
handled via Brussels. "The idea of a global Britain will be
postponed, because first you have to reorganize the Britain that's
already global," said Sergio Fabbrini, director of the LUISS School
of Government in Rome. "The U.K. will be taken up for years and
years by this."
Write to Marcus Walker at marcus.walker@wsj.com
(END) Dow Jones Newswires
December 15, 2019 09:14 ET (14:14 GMT)
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