Michel Barnier is facing internal pressure from the EU to soften his hardline stance
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Officials in Downing Street will enjoy a rare feeling of relief over the news today that European leaders are preparing to break away from Monsieur Barnier's unyielding line to propose at their summit next month what they see as a sensible compromise. Their desired deal would allow Britain to remain in the single market for goods while opting out of the bloc's free movement rules, despite the Frenchman making out they would have to be part of the package.
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However, European leaders would not want Britain to benefit overall by leaving their club, so the price they want it to pay is becoming clear. The White Paper fleshing out the plan Mrs May agreed at Chequers "almost gets to Jersey", the Centre for European Reform's trade wonk Sam Lowe tells me, but she would be expected to "accept that potential future divergence is not on the table" over goods.
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Although Liam Fox might not be able to agree to import things like American chicken in this scenario, he could still strike trade deals that affect services, the lion's share of the British economy, which would give him enough of a job to justify remaining in cabinet.
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The 'Facilitated Customs Arrangement' envisaged by Mrs May to save Britain from having to be in a customs union with Brussels has been pilloried widely in Westminster. She will hope that European leaders are kinder about it than Michel Barnier has been, but that looks unlikely. They would want her to "give up on the idea of a facilitated customs partnership - at least in practice - and accept the UK would be in a customs union", the CER's Sam Lowe thinks.
Her arrangement is deliberately different to a customs union, in that it allows the UK to run its own tariff regime at the border in future when systems are in place. That distinction will come under major pressure in the coming months.
As I predicted, it looks as though we will be wed to the EU on trade of goods, which only comprise 20% of our economy, and be able to strike free trade deals on services. This is all while having full control over our border policy.
For me, that's a pretty good deal. Immigration was the number one priority and the end to free movement our red line. It will satisfy remainers and
some Brexiteers, but do the hard brexiteers represent enough of the voting populace and/or parliament to stop it? I would think not. Regardless, there would be significant backlash over our subservience to the EU on goods, as many hard brexiteers have a colonial belief we'll become an exporting powerhouse and shift from a consumer-driven economy.
https://www.telegraph.co.uk/politics/2018/08/09/price-eu-leaders-want-britain-pay-brexit-deal-becoming-clear/This post was edited by dro94 on Aug 9 2018 02:22pm