Brexit negotiations will be ongoing for next decade

Almost exactly 12 months on from the result of the Brexit referendum, formal negotiations between the UK and the EU got under way this week. Both parties are entering into discussions knowing that neither will be in a position to claim a successful outcome. Whatever agreement is put in place, we can be sure that it will not be as beneficial to either party as the one that already existed. It is a strange point to be starting from in any set of negotiations.

Nevertheless, the start of negotiations is a positive development in that the scope for political grandstanding has now been significantly reduced. The increased accountability has already led to a shift away from much of the rhetoric of the past few months as the reality of what Brexit means starts to dawn – particularly within Westminster. The negotiation process should for the first time give British voters a sense of what they stand to lose from Brexit and the benefits of the existing arrangement.

Hope

Of course, some continue to cling to the hope that the aspirations outlined in Theresa May’s speech back in January, where she charted a path that would secure Global Britain free access to the EU market while outside both the single market and customs union, can somehow still be delivered. Most accept that what was presented to the British public was unrealistic.

The extent to which the ground has shifted in recent weeks is reflected in remarks by British Chancellor Philip Hammond on Tuesday. In a speech clearly aimed at reassuring an increasingly nervous UK business community, he highlighted the benefit of foreign workers to the UK economy and the need for Britain to maintain existing customs arrangements with the EU until a long-term system can be established.

Realistic view

While there is an expectation that this will be a 16- to 18-month negotiation process, a more realistic view would be that both parties would agree to maintain existing trading arrangements in order to facilitate a much longer phased transition. This could be agreed and implemented over a much longer 10-to 15-year period – if at all.

Colm McCarthy outlines the potential for Britain to exit the EU while remaining in both the customs union and the single market. This would be an ideal solution for Ireland, but one that would be a tough sell for British politicians – largely due to the fact that they naively raised the expectations of the British public as to what was achievable from the negotiation process. A free trade agreement that would give the UK free access to the EU single market without adhering to EU rules was never a reality.

So how can Ireland use its influence over the next 18 months to help bring the expectations of the British voter back to reality?

Interestingly, some are advocating that Ireland seeks to persuade the UK to change its mind about leaving the EU and, if unsuccessful, focus on selling the merits of remaining within the single market or remaining inside the customs union.

Of course, at the same time Ireland cannot afford to take its eye off the ball at EU level. Former Taoiseach Enda Kenny was successful in putting the challenges facing Ireland centre stage at EU level – but mostly in the context of protecting the Good Friday Agreement. This week, newly appointed Minister for Foreign Affairs Simon Coveney said Ireland would refuse to sign any Brexit deal that undermined stability in the North.

Challenges

Minister Coveney is of course well aware of the challenges facing our agri food sector from Brexit. He should therefore be in no doubt that farmers expect the same tough stance to be adopted in Brussels when it comes to safeguarding the future prosperity of rural Ireland.

Danny McCoy, IBEC CEO, once again presents the very real risk to our agri food sector from Brexit. He highlights the need for the negotiation process to deliver a smooth exit along with comprehensive transitional arrangements that gives industries time to adjust.

While there is disagreement as to what can be negotiated at what time in the Brexit negotiations, there is nothing preventing Ireland negotiating with the EU a package of measures that will protect the Irish economy and agri-food sector from the fallout of Brexit– whatever form it takes.