A long thread on my paper below. There is a lot of work to do both on policy and on process/structure ahead of next phase. UK could get a FTA done with the EU by the end of 2020. But it would be a narrow and shallow one. Issues outside the FTA (security etc.) may take longer 1/
First step ahead of the next phase is learning the lessons from the last phase. I’ve already covered this in a separate thread below. This is such a huge issue for the future of the UK it is important we all think critically about what we can do better 2/
Lots of policy decisions to be taken. Political Declaration is high level with many potential outcomes. e.g. there is little ambition on services. Does UK want something more ambitious? If so, given few FTAs cover cross border services provision could mean a longer negotiation 3/
Once the UK has taken more decisions on the detail of the policy it should quickly work to turn these into legal text or at least detailed policy proposals it can make public in the talks. This will help it get on the front foot and be clear about what it wants. 4/
Needs to be a clear strategy ahead of time. Not only looking at individual policy decisions but also how those fit together & overall picture. Includes considering ahead of time the trade offs that might need to be made & fallback positions 5/
So far, too much focus on just the FTA. Future relationship about much more, incl: security co-operation; data protection & sharing; aviation; energy and mobility. Decisions need to be made on how ambitious to be which will impact how long negotiations could take 6/
A key decision will be whether to seek a ‘mixed agreement’ which would need to be ratified by all EU states. Hard to see how such an agreement could be in place by end of 2020 7/
If UK wants to stick to its current timetable it means aiming for an agreement which falls under EU exclusive competence only – this would further limit the depth and breadth of any FTA 8/
The UK and the EU will also need to consider how they want the future relationship to be structured, will it be a single overarching agreement or a series of agreements linked by a broad governance structure. Both have pros and cons when it comes to leverage in talks 9/
On the process side, Whitehall is not currently set up to run such a wide ranging negotiation or implement the outcome. There will need to be machinery of Govt changes. DExEU should be wound down. 10/
There are broadly three options for how to set up Whitehall to run the negotiation:
1.Narrow central unit in No 10/CO
2.Broad central unit in CO
3.Combined DIT/DExEU
All can work, though option 2 seems the most sensible approach to me 11/
1.Narrow central unit in No 10/CO
2.Broad central unit in CO
3.Combined DIT/DExEU
All can work, though option 2 seems the most sensible approach to me 11/
Key decision will be how involved the PM is day to day. Does he lead negotiations or delegate more? Must have clear reporting lines & not create the same problem as
at start of DExEU. Also need a new centralised decision-making structure covering both EU & RoW negotiations 12/
at start of DExEU. Also need a new centralised decision-making structure covering both EU & RoW negotiations 12/
Four steps which need to be completed next year – securing mandates on both sides, negotiating the deal, ratifying the deal & implementing it. A large majority helps on mandate & ratification front but there is a lot to do to negotiate and implement a deal by end of 2020 13/
As well as the short time frame encouraging a narrow & shallow FTA based on exclusive EU competence, it will create some difficult strategic choices 14/
How much time should the UK spend seeking to negotiate with the EU over its positions on difficult areas such as level playing field, fisheries & geographical indicators? There may come a point where a trade off between speed & accepting certain EU demands has to be made 15/
This leads to even bigger choice. Does deal deliver sufficient benefit to outweigh political cost of accepting certain EU demands? Existence of this choice means chance UK leaves transition period w/out agreement is probably higher than some expect, though still not likely 16/
For this reason, short timeline also means EU will have to calibrate its opening positions carefully. If it aims too high on its asks in certain areas such as level playing field & fish, there is greater chance of derailing talks given the limited time for both sides to move 17/
Implementation a real challenge for Govt & business. Details of any deal won’t be known until late next year. Means businesses will start preparing w/out knowing fully what they are preparing for. Could lead to preparing for worst case – reduces some benefits of the deal 18/
Govt should consider whether there can be a phased process of implementation &/or more time for certain agreements to be implemented. But to have value this would have to be signaled early in negotiation so businesses can be sure of when they need to start making changes 19/
One option might be to secure a quick FTA & build on it over time. While worth considering, it has a big drawback. Businesses will make a single step to new status quo. Even if agreement changes over time they are unlikely to make more costly changes to their operating models 20/
There is much work for UK to do now. There is still time but it is short. I am optimistic that there is still a path to a positive future relationship between the UK & the EU but work needs to happen now to engage with the trade offs ahead. Best of luck to all involved! 21/ ENDS
