Barnier warns of Brexit ‘cliff edge’ as transition period begins

UK premier Boris Johnson has said a no-deal scenario will happen at the end of the 11-month transition period if the EU side continues to insist on a “level playing field” in any future deal.
credit: PA Images

By Martin Banks

03 Feb 2020

Michel Barnier, the EU’s chief Brexit negotiator, has warned there is a “real risk” of a Brexit “cliff edge” unless the trade talks between the two sides are conducted “in a spirit of mutual respect.”

Speaking in Brussels on Monday, Barnier said the EU was ready to make an “exceptional offer” but warned that the UK and EU will “need more time” to reach full agreement than the 11 months until 31 December 2020.

Addressing the possibility of the UK and EU failing to reach a trade agreement by the end of this year, Barnier told reporters, “This will be a constraint so we must prepare for all options, including a no deal. I don’t want that and will try to avoid it because there will be a widespread cliff edge if we don’t reach a deal.”


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He warned, “If we want to make progress in these talks it is important that they are conducted in a spirit of mutual respect and professionalism. This will always be my attitude and also that of my team.”

“I will act in good faith but will also defend and promote the EU interests and those of its citizens and businesses while at the same time striving to come up with solutions that will take account the choice of the UK which remains our friend and partner.”

Barnier, setting out the EU’s position for the upcoming trade talks, which are due to start next month, said, “It is important to understand that, even if do achieve a best-in-class agreement it cannot be business as usual. We will have two separate markets instead of one and new customs formalities will apply.”

He warned that the import of goods into the EU from the UK will, in future, have to “comply with EU rules” and will be “subject to regulatory checks.”

“We must prepare for all options, including a No Deal. I don’t want that and will try to avoid it because there will be a widespread cliff edge if we don’t reach a deal” Michel Barnier

“These are some of the mechanical consequences of the UK choice to leave so businesses must adapt now, I repeat now, to this new reality. The more we have common standards the better the agreement will be, but this is up to the UK to decide.”

“It is up to UK to decide on how closely this alignment is. This issue will be fundamental to our future relationship.”

His comments contrast sharply with those by Johnson who, also speaking on Monday, set out the UK’s negotiating stance.

He said once again that Britain will resist accepting any EU rules on social protections and the environment in the post-Brexit trade talks with the bloc.

Three days after the UK ended its 47-year membership of the EU, the Prime Minister used his first major speech since the decisive general election victory to set out his hard-line position to the post-Brexit talks.

As of midnight on Friday, Britain entered the “transition period” with the bloc and will continue to abide by the EU’s rules over the next 11 months, while officials in London and Brussels attempt to hammer out a future relationship.

Johnson has already vowed not to extend the negotiating period, and if no deal is agreed by 31 December then the UK could be forced to rely on WTO trading terms with the EU by 2021.

“It is important to understand that, even if do achieve a best-in-class agreement it cannot be business as usual. We will have two separate markets instead of one” Michel Barnier

Barnier, however, said he was determined to “defend EU interests”, adding, “We are clear that in any future deal we wish to have reciprocal access to fishing waters and a level playing field. This will be inextricably linked to a trade deal.”

He pointed out that Johnson has ruled out an extension to the transition period, adding, “That means that in a very short space of time we must make progress in these talks. This will not be easy so we need mutual trust. Mr Johnson has paid a lot of attention to every word and comma in the WD text to which he has committed.”

“One thing is for sure: you will not be able to accuse the EU of lacking ambition in these talks.”

Asking to comment on Johnson’s comments, he said, “The last 3 years have been marked by statements on both sides but I will listen to what people have to say and repeat that I want a fair deal.”

“We want to avoid unfair competition but it is up to him [Boris Johnson] to decide on this. For me, I will keep a cool head and stay calm. I will show respect and expect that in return. It is important that we are not overwhelmed by the things people might say.”

“I will not get involved in polemics or make judgements on what Mr Johnson or UK ministers are saying.”

He spoke of the “very sombre moment and very emotional moment” when the UK exited the EU on Friday, adding “but this is also a chance for a new start and a new relationship. The objective from now on is to construct with this great ally a new partnership and we must do this in the same spirt of trust and with the same transparency as we have done in the last three years.”

He said the draft negotiating directive, or “mandate for the future” had been adopted by the Commission earlier on Monday.

“This has been prepared for a while now so there won’t be any real surprise in it for anyone and it should be seen in the context of Council guidelines adopted by Council on 27 April 2017 and also the political declaration, a joint document which was approved by Boris Johnson on 17 Oct 2019.

“The aim is an ambitious partnership with the UK but we will remain clear headed. The most ambitious partnership is the one we had with the UK in the EU. You cannot have as favourable a position if you are not a member so we must address the UK’s choice to leave.”

“As I understand the UK will leave the single market and customs union in December so the UK can no longer benefit from the rights and advantages which are the preserve of an EU member.”

He outlined the “3 main chapters” of the draft - economic, security and governance issues - saying that there was the chance of zero tariffs on all goods entering the single market from the UK and an “ambitious FTA in services with wide sectoral coverage.”

“We are ready to offer all this even if we know there will be strong competition between the EU and UK in the future. But competition is normal.”

“Because of our geographical proximity and inter-dependence, this exception offer is conditional on two things. First, ensuring that competition is and remains open and fair and avoiding unfair competitive advantages.”

“We must now agree on the specifics that will guarantee a level playing field over the long term. That means upholding the highest standards in things like social and labour protection and state aid. Second, any FTA must include a deal on fisheries and providing for continue reciprocal access to our markets and waters.”

“If we can agree on this we will achieve an ambitious FTA.”

He said he will present the draft to Parliament on Wednesday and hopes it will be adopted at the EU summit on 25 February.

“We will have to make the best possible use of our time until 31 December, which is the date chosen by the UK to leave the single market. These are the conditions for what are an extraordinary set of talks but which will be subject to time constraints.”

“The consequences of a No Deal means that we will have to move forward more quickly in areas where there is the greatest of risk of a No Deal. However, will still be vigilant in ensuing that the 600 page WD is fully and properly implemented including the issue of citizens’ rights. I will issue, at regular intervals, reports on this.”

In order to boost transparency in the talks, he said he will also “step up dialogue with all stakeholders, unions and national parliaments and regularly publish all negotiating documents.”

Barnier said, “We must respect what is a very demanding framework for the talks. This has never been done before and it will be a real challenge to do it in 11 months, including a possible trade deal like those signed with Canada, South Korea and Japan. Of course, such FTAs also come with rights and obligations.”

The EU will take into account the “UK red lines” and added, “I believe that where there’s a will there is a way. We have the will but we will also be constrained by the decision of Mr Johnson to leave the single market and customs union at end of the year. He must decide if the UK leaves with or without a deal. There is a risk of the most serious cliff edge without a deal.”

Barnier conceded that any talk of “alignment” was a “red rag to the UK” but added, “the UK is asking for access to a market of 450 million and with zero quotas  but this won’t happen for nothing.”

He defended the role and importance of the ECJ, and added, “We favour free trade but we are not going to be naïve. Also, this is not just about trade but a lot of other issues too such as security and strong cooperation on data exchange and extradition.”

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