Theresa May’s speech in Florence – My analysis

Also read in this blog: Theresa May’s Florence speech – My comments


Hard Brexit wrapped up into a soft Transition

The Brexit negotiations are in a critical phase. The British negotiator believes that there is some progress, the EU has the impression, that there is far too little movement on the basic issues for the first phase: there is still no clear picture of how the rights of EU citizens in Britain will be guaranteed – embarrassing actions of the Home Office in London did not help to trust British politicians; there is still no clear regognition, that the divorce bill is about obligations and not subject to haggling over numbers; and the fact that the Northern Irish border will be a hard customs and travel border automatically, as long as Britain does not come up with a workable alternative instead of fantasies, is just denied.

So everybody hoped that Theresa May may break the deadlock with her speech in Florence on Friday, September 22, 2017. The speech was greeted by other EU leaders for the cooperative tone, but a closer view shows that there was no real change compared to the Lancaster House speech. The tone was moderate and friendly, the facts were different. The British Prime Minister now wants a hard Brexit wrapped up into a soft transition for two years. This was not unexpected because business in London had warned the Prime Minister that they would just fall off the cliff edge if they had not enough time to adapt. And the British government had already wasted a lot of time after the referendum.

Theresa May has finally recognized some facts: There is no way to break up the resolve of the 27 to keep the EU intact based on the four indivisable freedoms of goods, services, capital and movement of people. Since Britain is unwilling to accept all four freedoms, it was clear that there will be no free access to the single market. Since Britain wants to be fully sovereign third country outside the EU, negotiating its own trade agreements, it was clear that there will be no customs union.

The Prime Minister dismissed models for closer links to the EU like the EEA. The United Kingdom would love to have the same access to the single market, that the EEA has now, but does not want the obligations coming with that.

The message was: we want the hardest Brexit, full sovereignty, no more pooling of sovereignty, instead going our way alone as a global player, free to make bilateral treaties with everybody. Boris Johnson and Liam Fox must have been content with their Prime Minister.

The Prime Minister found a very positive tone when describing the shared values, the great cooperation and the great achievements Britain and the EU share. So I ask myself: why the devil does anybody to leave the EU?

All talk about a transition is only about making the jump from the cliff easier for business, but it remains a cliff edge scenario – only the date of the show should be postponed. Theresa May believes that two years will be enough to prepare for the jump. The example she chose was significant: For Theresa may the benchmark is, if the Border Agency and the Home Office can establish all their torturing instruments before the real Brexit happens. If this is the goal, why should the EU go with that? What is the attraction for the EU to have such a transition – or is it only a kind of protracted bankruptcy? Any transition needs the democratic consent of the European Parliament, recently snubbed by the Prime Minister, when she rejected an invitation to speak in the Plenary.

In my view a real transition needs ten years and should be done in the form of EEA-membership. Then everybody has time to adapt and there may even be a chance to ask the people in another referendum what they think after the desastreous performance of the Brexiteers. But Theresa May may be right that this is impossible, not because the people would not tolerate it, but because the right-wing Tories would cut her into pieces.

Theresa May is right to say that the European Union has never taken root in Britain as it has in most continental countries. She could have mentioned that British tabloids and Tories never gave Europe a chance. De Gaulle is vindicated in having believed that Britain will not become a convinced member of an integrated Europe. It is important to remember this, because some in Britain do as if the EU has forced Britain to become a member: The accession in 1973 was indeed voluntary vindicated by the people’s will in the referendum of 1975.

So perhaps we should accept the two-year transition because this will also give the continental cities more time to prepare for the bankers, doctors, nurses, plumbers and cleaners who will leave Britain to work on the continent. We will need more international schools, more housing and better regulation to keep pace with the Brexit-fallout. So that kind of transition may be needed.

Did the Prime Minister advance the actual negotiations?

Not really. She mentioned that EU citizens and their loved ones were welcome – the Ministry of Love, called Home Ofice seems to differ. She admitted that British courts could take into account judgments of the European Court of Justice when judging on the rights of EU-citizens who up to now are legal residents in Britain. That is no big commitment. The EU citizens will not feel reassured. However, the treatment of EU citizens will have a deep impact on our future relations.

Theresa May admitted that Britain will honour its financial obligations to the EU, but failed to make clear that this really IS AN OBLIGATION and not something to negotiate. What can be discussed is only, what is part of thet obligation, but not the obligation itself. Therefore all the debates in Britain about the sums are misleading. The Prime Minister did nothing to clarify this.

On Northern Ireland there was nothing new: the British government continues to be in denial of the facts. It is Brexit, that causes automatically a hard customs and people’s border between Eire and Northern Ireland. And it is the British government – fearing their DUP supporters – doing as if this is just not happening. There was a big hole where real politics should have replaced futile fantasy and denial. To expect that Britain can keep its borders under control and the EU must not is hypocritical. Theresa May failed on this topic which is essential for peace in Northern Ireland.

The Prime Minister once again tried to link these three questions, where the EU expects progress before any other topics can be discussed, to the future relationship. The speech in Florence did not help to get the deadlock lifted – under such circumstances the EU will rather postpone the next phase when the new partnership can be discussed.

A new bespoke economic partnership?

If you go to a bespoke tailor you may have to wait quite a long time until you get your bespoke suit. If you buy from the shelve it may be much easier. But in both cases you have to look what is on offer.

If you exclude the EEA type relationship as well as a free trade agreement like the one with Canada, there is not much choice left.

Tariffs will come automatically after Brexit day, the EU will then apply exactly the same tariff-book that the British customs officers do now and until Brexit day apply on imports from third countries outside the EU. In a free trade agreement most tariffs will put to zero, there may be exceptions, and services are not normally included in the agreement. There will be some promises to avoid non-tariff barriers, but that is a tricky business. Goods must be accompanied with papers proving how much of their content really comes from the partner country – if it is less than a certain percentage, customs duties have to be paid. Goods must also be accompanied by papers proving that all rules and standards of the EU are implemented before anything can be sold in the EU. Sanitary and health standards have to be proven or your cats and dogs must prepare for some months of quarantine. Travellers will have to show their suitcases and have to pay for everything beyond rather small allowances.

The EEA makes all this rules much easier and gives virtually all access to the single market with very few exceptions. However, even then proof of origin must be shown to avoid customs duties. Normally travellers will pass borders without control (EEA members joined the Schengen free travel area) and without opening their luggage.

Theresa May expressed the hope that the fact that Britain starts out still having common rules and common standards with the EU could help to make borders frictionless. But this is an illusion, because even common standards will only be recognized if there is also a reliable common control over them. Since neither the Commission nor the ECJ will have competences on the British side, the control has to be done on the EU side of the border – and that is not at all frictionless.

Even now the traveller from the continent has no frictionless access to Britain. Border controls are tedious and sometimes excessive, when children under 12 have to wait over an hour at border control, as I experienced in Luton on September 9, 2017.

Britain wants to be free to negotiate trade agreements with third countries. That implies that the goods from these third countries crossing from Britain into the EU must be controlled at the EU border. This explicitly excludes any EU-British customs union. A customs union would already be the lowest level of a special partnership. If the bespoke agreement is less it may serve for nothing to Britain and the EU. Why should expensive negotiators be asked to negotiate such a bespoke non-starter?

Conflict resolution is part of most free trade agreements and any other frameworks. If Britain is leaving all structures of our common efforts it can certainly avoid the ECJ jurisdiction, but that jurisdiction is still valid inside the EU and will have to be observed by all EU institutions, also when dealing with Britain. If expensive special courts could be established also depends if it is worthwhile for the purpose. The rather less expensive arbitration systems included in many agreements are at this time extremely unpopular in most European countries (being one of the reasons of resistance against TTIP and CETA), there may be no political wil to establish any of them.

It was interesting that Theresa May said nothing on the financial sector, where the fear of a cliff edge Brexit runs high in the City of London. It seems she has recognized that this important sector of the British economy can possibly not be saved. Even if part of the industry stays in Britain the country as a stand-alone will be too small for big finance, so that „Iceland on Thames“ could become a real threat.

Anything new in the security partnership?

Theresa May this time resisted the temptation to make security cooperation a bargaining chip for the future relationship to the EU. However, defence is mainly a NATO affair. Where the EU built up its rather small own forces and some command structures, Britain obstructed this wherever possible. NATO first was always the British view. With the United Kingdom outside of the EU, relations with Britain should consequently go through NATO channels. The EU should take the oppoertunity of Brexit to further develop own defence structures, but these should work mainly with NATO as a whole and through NATO with individual countries.

Fighting terror and crime has been a priority of EU home and justice affairs for more than a decade. Much progress was made especially through having an European Arrest Warrant, Europol, and Eurojust. It was the Home Secretary Theresa May who wanted to opt out of the full cooperation with the EU structures. Only after huge pressure from the terrified leaders of the security establishment, the secret services and the anti-terror-officers, the Home Office decided to re-opt-in in most of the cooperation schemes. This opt-out /opt-in had been explicitly conceded to Britain when the according treaties were signed. But this is not an option for non-members.

Home and justice affairs involve executive activities that may infringe in citizens rights. Therefore they must act in accordance with the European Human Rights Charter and EU and national laws, therefore they must be controlled by the judicial system, especially by the European Court of Justice. Since Britain does not want any ECJ involvement, that cooperation can only be very limited. Data protection is another point where EU law is involved. Even if Britain shares these laws, the scrutiny of the ECJ cannot be excluded.

Cherry-picking the nice and pretty EU-programs

Erasmus is a very popular program supporting European students to study in other EU countries. There are important programs for scientific cooperation in many fields of research and development. These programs were devised to promote an ever closer union in Europe. They were not open to non-members. International scientific and university cooperation is nonetheless very important, because science is global. Britain is a great nation in scientific research, many German and other EU citizens do research in the United Kingdom, many companies also develop innovations in Britain.

In the future this may be more limited. In an unfriendly,sometimes even xenophobic climate EU citizens may leave the UK, however the EU should do everything to keep cooperation with the UK intact. But this will not be the case where the EU is subsidizing programs for EU citizens. A country that explicitly does not want to be part of the ever closer union it would be strange if it wants to cherry-pick those programs only for its own benefit.

Interesting enough: Theresa May did not even mention Euratom, an important part of the European Union, founded together with the other institutions to further atomic energy. Euratom has an important role in controlling nuclear fuel cycles in Europe. There had been warnings in the UK that leaving Euratom could damage the position of Britain in the nuclear economy. While nuclear energy in Germany andsome other countries is soon to be phased aout, Britain still believes in this energy – so leaving Euratom could hit the UK more than others.

A tone of trust

As the Prime Minister said, a tone of trust is the cornerstone of any relationship. A Brexit campaign full of lies and slender, the childish tactics and the incompetence of the negotiators, the insolent tone coming from the Foreign Secretary, the incredible tone coming from the Home Office, and the unclear and up to now unreliable position of the British government did not build up any trust.

The starting point on the EU side was one of good will and trust into British pragmatism and sense of fairness. We were sad of Britain leaving. The good will has been gambled away, the trust damaged.

It is not too late to rebuild trust – but it will cost an effort. There are individuals in the British government who will certainly not be able nor willing to rebuild trust. Some sat in front of the Prime Minister during her speech, some may have spoilt her speech until it was as unhelpful as it became. Theresa May must decide if she will go on with that team. That will be the proof if she is in power or just in office.