Ha! So those continentals have blinked, as we Brits always knew they would! Boris Johnson demanded a “fundamental change” in the EU’s approach to the Brexit negotiations, and Michel Barnier has duly hauled up the white flag, confessing to the European Parliament the need for “compromises on both sides”. But let’s be generous in victory, and make allowances for the well-known fact that Europeans have always been a bit slow on the uptake: as the Daily Express headline has it, “Brexit breakthrough: Penny drops as EU agrees to respect UK sovereignty”.
So is a deal now in the bag? The money markets certainly seem to assume that it is more likely than not. And how could either side rationally accept the economic damage that a breakdown would inflict on both, on top of the covid-19 disaster? (You might imagine that that thought would weigh especially heavily on the British side, given that the ravages of the coronavirus have reminded us of just how much our economy depends upon the hospitality industry – serving each other food and drink – while the shrunken sectors that actually earn foreign currency – aerospace, automotive, agriculture – are just those that would be hardest hit by a no deal.)
Of course, compromise will be awkward to sell, on both sides of the Channel. Governance and state aid solutions will be complex, so can probably be fudged in presentation; fisheries less so. The sector may be trivial in economic terms, but it is wonderfully telegenic: and, since neither side will get 100 per cent, accusations of a sell-out are inevitable on both. Emmanuel Macron has a well-known problem here: but, like Johnson, he can always try to mollify offended fishing communities with cash – and Macron can also point to the £6 billion annual surplus in bilateral goods trade with the UK that a deal should protect.
On the British side, the considerations will be somewhat different. Here, the politics are not some awkward-to-manage consequence of striking a deal that, overall, serves the national interest; the politics are the only thing that matter. So, as I have argued elsewhere, Johnson will not make up his mind on whether to sign until the last possible moment – with his final calculus based entirely on how the outcome will make him look.
On the one hand, accepting a deal – any deal – will likely be condemned as betrayal by the Murdoch press, and the Europhobe Brexiteers who have taken over the Conservative Party, and with whom Johnson has filled his government. And the media will flock to the fishing ports. Walking away, by contrast, would fit well with Johnson’s Churchillian self-image. Nor will the “disaster averted” line be available to sell a deal, given how vigorously the government has talked up the attractions of no deal, which is a “good outcome for UK” according to the prime minister, and one which will actually improve British security according to one minister, Michael Gove, in a remarkable parliamentary exchange with ex-premier Theresa May.
On the other hand, Johnson could find himself pressed about the promise of an “oven-ready deal” with which he won last December’s general election. And chaos at the Channel ports on 2 January (the government is building a network of massive lorry parks to accommodate the 7,000 trucks that could be held up) could soon take the gilt off the show of heroic national defiance, as vital supplies of food and medicines run short in the middle of the pandemic. 2 January might be too distant a prospect normally to register on the Johnson radar, but it does seem to be getting closer by the day.
On the third hand, what if there is chaos anyway – including with a deal? British industry has proved resistant to government exhortations to get with the programme and embrace all the new opportunities that Brexit will afford them, preferring, it seems, to whinge on about national lack of preparedness for the end of transition. Road hauliers have been particularly disobliging about the continuing absence of basic arrangements – clear processes, IT systems, trained customs agents – that will be needed to handle trade into the single market, even if a no-tariffs, no-quotas deal is struck. If that is the prospect, surely better to crash out now and blame the new year shambles on vindictive continentals? Gove, as minister in charge of Brexit preparedness, must be sweating over this in particular.
Indeed, Gove has already had the foresight to take some pressure off himself by decreeing back in June that EU goods can initially be waved through, without full UK import controls in place for the first six months. Which suggests the thought – what if the EU were to offer a reciprocal breathing space, a sort of “administrative bedding-in period” for the first half of 2021, to make the spectre of “deal followed by new year chaos anyway” go away? If my analysis of the real British calculus is correct (and I am very much afraid it is) then such a move could well be decisive in bringing Johnson on board for a deal. It would, of course, require the EU side to bring to the table all the imagination and forbearance that averting a mutually damaging outcome will require. But then, they must be inured to that by now.
The European Council on Foreign Relations does not take collective positions. ECFR publications only represent the views of their individual authors.