So where do Brexit negotiations stand & is deal likely? Lots of conflicting signals. Lots of challenges. But it seems @BorisJohnson & @LeoVaradkar have basically decided they want to get it done. Thread following chats with senior UK, EU & Irish officials over the weekend 1/
There's competing views between UK & Irish sides as to why there's now momentum for a deal. Senior UK sources say Irish have moved - away from principles to their actual bottom lines. Senior Irish sources say it's because BJ has conceded on customs & consent. The different 2/
interpretations may be about both sides positioning themselves to sell a deal. Both worth exploring. Senior UK sources argue Dublin's absolute bottom line is now to ensure “tariffs are off table on the north-south border for all time”. This is where talk of a “partial” FTA has 3/
come from. Senior UK sources argue that as FTA could take tariffs to zero for originating goods between the two contracting parties, a commitment to a future zero-tariff UK-EU trade deal could address Ireland’s concern. 3 problems. 1/ @EU_Commission won't agree to zero tariff 4/
UK-EU FTA as part of divorce as A50 legal base won't allow it. 2/ @BorisJohnson reluctance to accept level playing field conditions will make 27 less willing to offer London zero-tariff trade. The best UK could hope for is language in political declaration. 3/ For goods that 5/
don’t originate from two contracting parties, traders would still need to comply with rules of origin or pay a tariff. So key question for UK side is whether Irish want to eliminate *all tariffs* on N-S border or just those related to trade between 2 parties to deal? 6/
If latter, it could be argued Irish have softened, as implication is they would be willing to accept some customs process related to RoO on island of Ireland, albeit away from N-S border. One senior UK official asks: “Are the Irish signalling real acceptance of this or hoping 7/
the Commission will push back?” Senior Irish sources disagree with this interpretation. They argue BJ offered @LeoVaradkar 3 major concessions & that's what has convinced Dublin to re-engage: “We didn’t say anything about tariffs; perhaps the political 8/
framing and language of an FTA is necessary for London to sell the deal.” According to my chats, BJ has moved in 3 major ways. 1/ BJ believes DUP could accept a “type of customs border” in Irish Sea as Govt has already conceded regulatory border. This is where May’s customs 9/
partnership for Northern Ireland comes into play. 2/ BJ has accepted that unionists can't have upfront veto. 3/ BJ has accepted that consent can't be “a rolling process.” A senior Irish official continues: “The mechanism that is being discussed now will just happen once and 10/
that’s it. It will be a one-off political event that decides definitively if the North stays aligned to the Single Market and the customs union. In or out. That’s it. Start is in. There’s a question of when that mechanism will be litigated.” If correct, BJ has addressed all 11/
EU & Dublin's concerns. Despite that @BorisJohnson is still confident he can deliver the DUP. Senior officials in Dublin are much more cautious: “Boris thinks he can bring the DUP on board; we don’t know why he has this confidence.” UK officials concur that the deal that is 12/
taking shape looks good for Varadkar: “In the models that are being discussed, most of the customs processes are east-west as opposed to north-south.” However, the fact there could possibly be some N-S RoO checks (if you believe UK interpretation) might be important for BJ to 13/
sell the deal: “The question is what % of the process can be shifted east-west versus north-south? It used to be 0-100. Now we might be at 20-80” says senior UK source. Besides politics in Westminster & DUP - which are BIG challenges - there's lots of other obstacles too 14/
Senior UK & Irish sources agree the first will be overcoming resistance from Taskforce 50, which is signalling more caution than the Council. “This deal will be ugly, messy, sui-generis and bespoke. That’s why Taskforce 50 won’t like it”, says one senior Irish official. 15/
Another problem is limited time. UK officials believe the legal and technical hurdles of the customs partnership present negotiators with at least “three months of very hard work.” Some suggest a staggered timetable to allow progress to be demonstrated when necessary. Others 16/
point to a second Council in last week of October. “It’s all rather chaotic, Tusk must be quite agitated as he has to decide what next week’s Council is going to be about” says one senior source. After all, a leaders discussion about no deal & an extension is very different 17/
than a deal. & EU leaders won't want to negotiate detail. The time constraint does create risks, as to alleviate pressure & ensure any deal is legally operable, the Commission might try & edge UK towards “a structure that is not completely innovative and can be approximated 18/
by stuff that’s already out there.” But the more the deal begins to resemble the Northern Ireland-only backstop, the less likely it is Boris will sign on line. However, despite all substantive, legal, political & time-related problems, what's seems clear to me is that Johnson 19/
& Varadkar both now want a deal. One big calculation seems to be that addressing Brexit fatigue will give each leader a big political dividend in elections they'll both soon face. One senior Irish source told me: “Varadkar won’t use next week’s Council to sell the deal but he 20/
will be of the view there’s a deal to be done. This is probably why noises from Council are a tad more optimistic than Taskforce 50. The senior Irish source continues: “Varadkar always knew that he would have to compromise on the backstop. He always knew that. After Theresa 21/
lost 3 MVs he was very clear about that in private but couldn't say it in public. It's better to modify the backstop than go to no deal.” I'm told finance minister @Paschald has also always been on this line; @simoncoveney more hawkish views don't reflect their thinking 22/
Of course, in Dublin's interpretation, @LeoVaradkar is not conceding v much at all. This is one major reason why Irish chose to re-engage. “Our incentives were always to wait him out.” Officials believe the Benn Act would have forced BJ to compromise further. “But now Boris 23/
has moved on customs, there's nothing else for him to compromise.” So macro political factors in UK & Dublin are pushing @BorisJohnson & @LeoVaradkar to do a deal. Senior EU & Irish officials believe if Varadkar supports it, the other 26 will as well. The technical and legal 24/
challenges then become details TF50 & others have to work out, as leaders have decided the politics now favour an agreement. Perhaps. But there's still big hoops to jump through, not least for @BorisJohnson. The deal % are certainly rising, but we're probs not there just yet ENDS
