“A little over six months ago”; began Theresa May in her most defining speech on Brexit to date. It feels like a very long six months; filled with buzz words and vacuous catch-phrases such as ‘hard Brexit’ and ‘soft Brexit’ and worst of all, ‘red, white and blue Brexit’. As the reality of the British people’s decision comes to fruition the opportunities to obfuscate and delay by the UK are diminishing.
So Theresa May’s speech today was a perfect occasion to set out her stall and the UK’s negotiating position in front of a curious and somewhat concerned global audience.
The Prime Minister talked about a global Britain striking trade deals with old colonies around the World and the EU, but also trying to have some level of membership of the EU Customs Union. Surely this is an impossible proposition of trying to negotiate new trade deals while having a presence in the EU where external tariffs are set. Expect the EU to take a hard line on this proposal.
May talked about the importance of the CTA (Common Travel Area) with The Republic of Ireland while also underlining the importance of immigration controls. She spoke at a macro level of a practical solution regarding the 500km border while maintaining the CTA. But macro it remained, without any specifics. Maintaining a CTA with no hard Irish/U.K. border, while simultaneously controlling immigration, is an agenda item that will test the negotiating teams.
While outlining the UK’s twelve point plan for Brexit; there was a lack of clear detail that underscored Britain’s own vision and certainty on what the future holds.
To cap it all off; Prime Minister May said that any final agreement would be put to a vote of both the House of Commons and the House of Lords. So when and if any deal is done; it will go to the British Parliament for approval, again there is no certainty that Westminster will approve a final deal.
May’s speech was well delivered and tactically she has set out the broad parameters of the UK’s wish list first. The markets received the speech well, with Sterling having its best single day for almost a decade.
Attention now shifts to the EU's response. Expect Brussels to take a polite but firm stance; especially given May’s closing, where she made thinly veiled economic threats against the EU.
Don’t expect Brexit to take two years; this entire process will be complex from an economic and political perspective and perhaps lead to in the medium term to some societal un-surety; especially for foreign nationals living in the UK and British citizens living across the EU.
The only certain thing is that there will be no quick or simple Brexit; but the long goodbye has definitely begun.