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It’s beginning to look a lot like Brexmas

Image credit: Elias (Pixabay: Creative Commons)

The official date for Brexit – set for midnight on March 29, 2019 – is fast approaching, and although it is tempting to see 2019 as the end of the Brexit tale, it is more accurate to see this date as the end of the first book in a perilous trilogy for the UK.

The end of 2017 was a time of mixed results in the world of Brexit. It was only as recently as mid-December that an agreement was successfully struck between the parties on first phase priority issues of:

  • The rights of EU citizens in the UK

  • No hard border existing between Northern Ireland and the Republic of Ireland

  • The final settlement of the UK’s 52 billion euro divorce bill

Mid-December also saw Prime Minister May’s government being forced to accept amendments to the so-called ‘Henry VIII’ powers in the EU Withdrawal Bill, with May suffering her first Commons defeat on Brexit when 11 of her government’s MPs voted against the leadership.

Although 2017 ended with some progress finally being made on Brexit, a look forward into 2018 and beyond reveals the numerous pitfalls that the UK will soon be forced to navigate.

The EU and the UK will soon move into the second phase of negotiations, which will primarily focus on transitional arrangements post March 2019. For the UK, this will be the key period for negotiating trade arrangements between the UK and the EU common market. At this stage, it remains unclear what such trade arrangements may look like, with an arrangement similar to that existing between the EU and Canada looking to be the frontrunner option, and one which is far more palatable than a reversion to WTO standards. Meanwhile, the EU will undoubtedly be seeking to keep the UK in line with its current standards, an arrangement wherein the UK will have no say in the rules it will be subject to until the end of the transition period.

The parties will have much to talk about and act on in 2018, and not that long to do so.

Although it is tempting to think so, Brexit negotiations have not been occurring in a regional vacuum. Notably, Australia and New Zealand are already eager to commence free trade negotiations with the UK, and both nations have already begun discussions with the EU. For the UK, post-Brexit will be a precarious time wherein it will finally have the capacity to enter its own free trade arrangements, and will indeed be under pressure to conclude such agreements quickly to remain competitive on the international stage.

Compared to countries such as Australia, which has a trade negotiating team sharpened against the whetstone of many recent and ongoing trade agreements, the UK’s small and inexperienced trade negotiation team will be ill-prepared to make the most of the UK’s considerable economic strengths. In a time where investor confidence is at an all-time low, the UK is caught between the need to quickly establish favourable trade agreements, and its own inexperience that will undoubtedly make delivery of such favourable agreements a difficult task.

Every step forward has been hard fought, both in the UK and beyond, and much more progress will need to be made to ensure a clean Brexit. For May in particular, Brexit in 2017 has been a trial.

But as they say, a New Year, New May.

Dylan Hubbard is the International Trade and Economy Fellow at Young Australians in International Affairs.

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