by Maria Savel
September 6, 2016

from WorldPoliticsReview Website

 

British Prime Minister Theresa May

arrives for a press conference

at the end of the G-20 summit,

Hangzhou, China, Sept. 5, 2016

(AP photo by Ng Han Guan).
 

Last week, U.K. Prime Minister Theresa May reiterated that "Brexit means Brexit," her formula for insisting that she will respect the outcome of the referendum in favor of Britain’s withdrawal from the European Union.

Her comments came as the Cabinet met to discuss Brexit strategy and the need to find a "unique" deal for the U.K. as it negotiates its EU exit, a proposition that is proving to be easier said than done.

The outcome of the June referendum, in which 52 percent of Britons voted in favor of leaving the EU, prompted fears that the U.K.’s economy would collapse, as well as concerns for the EU’s future.

But now that the initial shock has worn off, it seems that many people’s original fears were overblown.

The British economy, which took a significant hit in the immediate aftermath of the referendum, has recovered better than many economists expected, as highlighted by recent consumer spending reports.

Susi Dennison, a senior policy fellow at the European Council on Foreign Relations, points out that corrective action was taken to soften the economic blow. For example, the Bank of England lowered interest rates in order to avoid even greater Brexit fallout.

But even though the economic turmoil from the "yes" vote hasn’t been as severe as expected, May warned over the weekend that,

"there will be difficult times ahead."

The Brexit vote also prompted fears that Scotland would renew its bid for independence.

In the Brexit referendum, 62 percent of Scots voted to remain in the EU, and Scottish First Minister Nicola Sturgeon said shortly after the vote that a second independence referendum - the last one was held in 2014 - "was highly likely."

She added that it was "democratically unacceptable" that Scotland could be taken out of the EU against its will.

Sturgeon launched a new independence drive on Friday, but according to Dennison, another independence referendum "is off the table." There are doubts as to how strong support for independence actually is in Scotland, with a July poll showing that 53 percent of Scots wanted to remain part of the United Kingdom.

May visited Edinburgh in July for talks with Sturgeon, and it appeared that the two leaders came to an understanding.

After their meeting, May said,

"We now have the challenge... to ensure that we can get the best possible deal for the whole of the United Kingdom from the EU negotiations when the U.K. leaves the EU."

So while Sturgeon might explore the possibility of another Scottish independence referendum, it is unlikely to happen, unless the actual Brexit negotiations leave Scotland feeling like its interests aren’t being protected.

One thing is certain for now - The Brexit negotiations will happen

For now, however, it remains uncertain when the negotiations between the U.K. and the EU will actually begin.

May has avoided triggering Article 50 of the EU’s Lisbon Treaty, which sets into motion the two-year exit process, and said that she won’t do so until the start of 2017 at the earliest, giving her government time to properly develop its negotiating position.

If May waits any longer to trigger Article 50, the start of negotiations will run up against the French presidential elections and German federal elections, and,

"no one wants that level of delay," says Dennison.

May has given her ministers until the end of the year to develop a government-wide position for the talks.

She has said that all of the different options are still on the table,

• from a "hard Brexit" that would mean leaving the EU and the single market without negotiating an independent free trade deal with the bloc

• to a "soft Brexit" that would likely be built around an independent free trade deal

For the soft option, London would have to get the EU to accept two major caveats:

• limitations on the free movement of people - the U.K. is willing to accept citizens of EU member states coming to work but not those coming to look for work

• significantly reduced budgetary contributions to the EU:

"The government won’t be able to accept any deal with the EU that doesn’t show considerable changes from what the U.K. had before," Dennison explains.

Meanwhile, in Brussels, EU leaders are also still figuring out their negotiating position.

European leaders do not want to appear as though they are punishing the U.K., but the risk of Brexit contagion is real.

According to Dennison, Brussels doesn’t want to reward Britain,

"for taking this decision in the current populist environment."

To limit the possible fallout, there will likely be a push from within Brussels to simplify the EU’s functioning by focusing on core issues that citizens care about, namely,

• security

• economic growth

One thing is certain for now:

The Brexit negotiations will happen.

May is determined to follow through on the referendum outcome, and the initial court cases in Britain to block Brexit - including one the High Court is due to hear in October on whether or not May can trigger Article 50 without Parliament’s authorization - are long shots.

Moreover, as Dennison explains, British politicians,

"are reluctant to go down the referendum route again," ruling out the possibility of a second Brexit vote.

But Dennison suggests that if the final deal the British government negotiates with the EU, and the trade talks that will accompany the Article 50 negotiations, are particularly unfavorable to the U.K. or widely considered to be political and economic liabilities,

"the government would be forced to go back to Parliament," which could vote to reject an agreement.

For now, though, in both London and Brussels, Brexit still means Brexit, even if both sides are still trying to figure out what that will actually mean...