Brexit Update - 8th January 2020

Wake Smith chairman John Baddeley looks at the latest Brexit news...

As we launch into the new year, Brexit is way down the media agenda with rising tensions in the Middle East making the headlines.

However, we are rapidly approaching the 31st of January, the date upon which we formally leave the EU and start negotiating on the framework of a deal.

The Prime Minister is facing increasing pressure of his own creation if he is to stick to his pledge not to extend the negotiation period beyond the 31st of December deadline, which leaves precious little time to actually formulate a working agreement for future trade with the EU.

Aside from the basics of a trade deal, Boris Johnson will also need to make clear how the UK will align, if at all, with the EU on matters including workers' rights and ways of protecting industry from EU tariffs and regulatory hurdles.

The ever present threat of a no deal Brexit is still in the offing and this continues to hold many industries and investors back until there is greater clarity and a more measurable outcome.

Opposition parties are already tabling amendments to the Prime Minister's withdrawal agreement including yet more efforts to delay the UK's exit from the EU if an agreement cannot be formalised by the middle of June.

The Conservative majority means that these amendments are unlikely to be successful, but the EU has also expressed 'serious concerns' over negotiating the future UK/EU deal within an eleven month timeframe.

Within all of these machinations, Boris Johnson has remained steadfast that the UK will leave the EU customs union, exit the single market and terminate the overall legal power of the European Court of Justice in UK matters.

This creates quite a bitter pill for the EU to swallow, having had the upper hand in all of the negotiations prior to Boris Johnson taking the Conservative party lead and it raises the question of how much they might finally concede to retain trade of significant value with the UK.

For now at least, the UK Government is playing a determined game of brinksmanship with European counterparts. Whether there is a plan B or not remains to be seen...

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