As talks in Brussels grind on, voters in the Surrey town of Staines-upon-Thames, part of the constituency of Spelthorne which backed leaving the EU by 60 to 40 last summer, are flummoxed about why the Brexit process has taken so long. Sue Shaw, a school worker, said she had expected Brexit by last Christmas. “A lot of people I work with thought we would be out within a week, they thought that it we voted leave we would get on and leave,” she said as she walked her dog near the river Thames. “It’s been very slow. Personally, I thought we would be out in six months.” Dave Matthews, a retired accountant, echoed her view. “The government has been too slow and a bit too weak in the negotiations,” he said as he filled in a crossword on a bench. He partly blamed David Cameron, the former prime minister, for failing to oversee any detailed preparations for Brexit in the run-up to the June 2016 EU referendum. Now he is becoming alarmed about the idea of a “transition deal” for several years after March 2019. That would involve continued freedom of movement and payments to the EU as well as potential oversight by the European Courts of Justice — while a trade deal is finalised with Brussels. “I think if we are going to do this thing, then the sooner we go the better. Hanging on for years and years, I don’t see the benefit of that quite honestly,” he said. Many Leave voters wanted to quit the EU because they thought excessive immigration had driven down wages and put pressure on public services, said Mr Matthews. “Carrying on with that is not acceptable.” As David Davis, Brexit secretary, tries to pick his way through the complex negotiations, the patience of Leave voters appears to be wearing thin. Confusing messages emerging from the government have not helped. Julie Oropallo, a retired hairdresser, admitted that the Brexit process had not been what many voters had expected when they voted Leave. “I voted to come out, but it seems to be taking a lot longer, I imagined it would be over in two years or so, but it’s turned out to be incredibly complex.” Meeting the public’s expectations could also pose problems for the government, with interviewees in Staines puzzled over several details, including why Britain should pay a multibillion pound “divorce” settlement. Several people agreed with Boris Johnson, the foreign secretary, who said the EU could “go whistle” if they expect a large payment. “Boris was right, we shouldn’t pay a penny,” said Margaret Blythe, a retail worker. “Think how much we’ve given them over the years . . . they probably owe us don’t they?” Anthony Wells, politics director at YouGov, believes the final figure for the divorce bill could trigger a backlash from angry voters. According to a survey by ICM for The Guardian newspaper this week, only 11 per cent found the idea of Britain paying “up to £30bn” “acceptable” against 72 per cent who did not. “People will think, ‘crikey’, that’s a huge amount, that’s outrageous, unless the popular media don’t express any outrage . . . which feels unlikely,” said Mr Wells. “The thing is, issues such as trade deals, City passporting, customs and so on are incredibly complicated whereas the payment of £10bn, or whatever the final figure is, is incredibly straightforward.” Mr Wells said that the figure could potentially be sold to the public if it was described as a fee for continued access rather than a fee for simply leaving the bloc. But that had not happened yet. “I don’t think the government has even started to communicate a message on this. Instead, they are still letting it be talked about as an exit fee.” The government has found it hard to communicating a clear message over Brexit without a clear idea of what kind of deal it can strike with the EU. Asked who was responsible for selling Britain’s Brexit strategy to the public, one aide replied: “The prime minister and cabinet.” Sir Craig Oliver, former head of communications for Mr Cameron, said that any public backlash against the final deal, over issues such as immigration or the divorce bill, would depend on the reaction from Eurosceptic Tory MPs and their media allies. “It all depends on what the Brexiters are willing to tolerate. If they say: ‘We’re OK with that’ then it’s harder to build up a narrative of betrayal or disaster,” he said. “If they say, ‘hold on, this is not what we were sold’, then it becomes more difficult for Number 10.” “The government’s communication strategy seems to be based on a confidence that the Leave lobby won’t complain,” said Sir Craig. “If Brexiters don’t provide a megaphone to amplify dissent, it’s less likely there’ll be a public outcry.” Chris Pratt, strategy director at Hill+Knowlton Strategies, said there was “no evidence” of a planned, deliberate communications strategy from ministers. “The government only seem able to firefight,” he said. “There is a real risk that they will fail to manage public expectations following the rhetoric of the referendum campaign and business is left with continued uncertainty.” Joey Jones, a former adviser to Mrs May, said voters seemed “pretty bored” by Brexit: but they could be “inflamed” at the drop of a hat. “The key thing for the government to do is explain that any deal requires messy compromise and concessions on the UK side not just in Brussels,” said Mr Jones, now head of public affairs at Weber Shandwick. “If ministers don’t get that across, then whatever eventual agreement is reached will be torn apart by true believers on one side or another denouncing it as a cave-in and capitulation.” Read again Staines voters lose patience with slow Brexit process : http://ift.tt/2gtxicK
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The UK must not allow itself to be blackmailed by the EU over its Brexit "divorce bill" in order to start trade talks, International Trade Secretary Liam Fox has said. He said a bad Brexit deal would damage both British and European companies. Businesses have become impatient with the slow progress of the Brexit negotiations, he added. The latest Brexit talks have stalled over the failure to reach agreement on the UK's exit settlement. Both the UK and EU have expressed frustration at the pace of the talks. The UK wants to begin trade talks as soon as possible, but Brussels insists that discussions about the future relationship after Brexit can begin only once "sufficient progress" has been made on the arrangements for withdrawal - including on the UK's "divorce fee". EU negotiator Michel Barnier said that at the current rate of progress, he was quite far from being able to recommend opening parallel talks on a future trade relationship. No figure has yet been put on the divorce payment, but European Commission president Jean-Claude Juncker has suggested it could come in at about 60bn euros (£55bn), while unconfirmed reports have put it as high as 100bn euros (£92bn). Speaking in Japan on Friday, Mr Fox said everyone would benefit from Brexit if the outcome was free trade with no tariff barriers. Asked whether it was time for the UK to name its Brexit price, he told ITV News: "We can't be blackmailed into paying a price on the first part (the divorce fee). "We think we should begin discussions on the final settlement because that's good for business, and it's good for the prosperity both of the British people and of the rest of the people of the European Union." He and Prime Minister Theresa May have been having talks with Japanese leaders about the future of trading relations between the two countries after Brexit. 'Unlock some tension'Speaking to the BBC at the end of the three-day visit, Mr Fox said: "It's very clear that businesses, not just in Europe but investors in places like here in Japan, are getting impatient and want to see what that final shape of that [Brexit] arrangement is going to be." He said a willingness by the EU to negotiate on the future trading relationship now would "unlock some of the tension". He added he thought it was a "mistake" for the EU to think a delay in talking about the economy and the trading arrangement would not potentially damage them too. Speaking on Thursday after talks in Brussels with Brexit Secretary David Davis, Mr Barnier said the UK did not feel "legally obliged to honour its obligations" after Brexit. He said "no decisive progress" had been made on key issues, following the third round of talks. Mr Davis said the UK had a "duty to our taxpayers" to "rigorously" examine the EU's demands. And he urged the EU to be "more imaginative and flexible" in its approach. Read again Brexit: UK 'must not allow itself to be blackmailed' : http://ift.tt/2wnoV8bBritain's exit from the European Union has sent bankers scurrying for Frankfurt, Dublin, and Paris — and opened up new space for savvy commercial real-estate investors, Bloombergreports. Australia’s largest pension fund AustralianSuper is looking to acquire more overseas assets and part of its revamped portfolio could come from British infrastructure and real estate investments according to Mark Delaney, the fund's chief investment officer. “Brexit may present an opportunity for us, but we will need to be patient,” Delaney told Bloomberg late August. “There are likely to be some good quality assets that become available that will be worth looking at.” He explained that as international banks hedge against Brexit by scoping office space in other European capitals, and risk adverse capital looks elsewhere, long-term buyers could snap up the freed up assets. London's older buildings, in particular, have seen prices push down. For more on Brexit, watch Fortune's video: But its not only Brexit-flight that has opened up space in London. According to Delaney, Chinese investment — which has traditionally been “the price setter” in markets like commercial real estate — is starting to dry up. That's down to new capital controls Beijing has imposed to prevent Chinese firms from making large investments abroad. Under the new rules, Chinese buyers are not allowed to make "irrational” acquisitions of assets in industries ranging from real estate to hotels and entertainment, Bloomberg reports — and that's opening up opportunities for everyone else. Read again Brexit Flight and Chinese Capital Controls Are Freeing Up London's Crowded Commercial Real Estate Market : http://ift.tt/2wrS5S4The biggest fights in the European Union are always about money, so there was never any reason to suppose that the Brexit negotiations would be any different. Last year, Treasury figures show the UK paid about £13bn to the EU, around £200 per person. Some of which then gets spent in the UK. But the European Commission is trying to calculate what the UK's outstanding financial obligation should be when it leaves. The EU argues that the UK has made a series of big financial commitments as part of the current seven-year budget that need to be paid on exit. It also says the UK needs to settle its share of what's known as the "reste à liquider". This is money that has been committed but not yet paid - in effect the EU's credit card bill. No decisive progress on Brexit - Barnier What is at stake in EU-UK talks? All you need to know about Brexit Here's the problem for the EU: the less the UK agrees to pay, the more other countries will have to fill the gap. That means that countries that are net contributors to the EU budget, like Germany or the Netherlands, will have to pay more. At the other end of the scale, the countries that are net beneficiaries, like Poland or Greece, will receive less. So when the UK argues that the EU is being unreasonable in its demands, it has no allies at all. The hard line approach adopted by the European Commission has come from pressure from other member states. They don't think, for example, that the UK should be entitled to a share of the EU's assets when financial calculations are made. Biggest net contributors to the EU Budget
Biggest net recipients of the EU Budget
Source: European Commission British officials spent several hours during this week's negotiations questioning the legal basis of the EU's proposals. But they haven't put forward counter-proposals of their own - which, in turn, is annoying European officials. How can we negotiate, they argue, when we don't know what you want? Hence the pessimistic tone of Europe's chief Brexit negotiator Michel Barnier, who again insisted that the divorce deal must be agreed before talks move on to discuss issues such as the future trade relationship. Mr Barnier claimed there had been "no decisive progress" and the negotiations were still "quite far" away from being able to move on to other issues. The EU hasn't publicly put a figure on the amount it thinks the UK should pay, but many estimates come up with a net figure of about 60 billion euros. The UK says it won't pay anything like that. Is it deadlock?One possible route out of the impasse is talk of a transition period. If the UK was still paying into the EU budget for two or three years after Brexit, that could help reduce the final exit bill considerably. It would also fill a hole in the EU budget, and generate goodwill elsewhere on the continent. Mujtaba Rahman is a Brexit expert and Managing Director at the Eurasia Group, a political risk consultancy. He says that it will be up to Theresa May to lay the groundwork in order for negotiations to progress: "In October when heads of state get together there will be an opportunity for Theresa May to make the case that she can only write a cheque if it's packaged as part of a bigger deal that gives the UK concessions on both transition and future trade terms." It is worth remembering that compared to what's at stake in renegotiating the UK's entire trading relationship with the EU and the rest of the world, even 60 billion euros or more isn't a huge amount. But politically, it's explosive. And three months after these negotiations finally began, under pressure of time, it has become the toughest nut to crack. In the end it will have to be resolved by political decisions rather than legal or technical advice. Read again Brexit talks: Why it's all about the money : http://ift.tt/2vOo1Oi UK prime minister Theresa May looked to offer reassurances about Britain’s future on Thursday, after Shinzo Abe, the Japanese prime minister, expressed concerns about the Brexit process. In a joint press conference with Mrs May on Thursday, Mr Abe said he had told the UK prime minister that many Japanese companies invested in Britain as a “gateway” to the EU. He said he had asked Mrs May for reassurances about whether similar arrangements would continue in future. “We have 1,000 companies operating in the United Kingdom,” Mr Abe said. “It is a base and they use it as a gateway to the European Union. So I have asked for greater transparency and predictability in this regard.” The Japanese prime minister said Mrs May had responded to his concerns “in a very forceful way”, but did not specify what reassurances she had offered him. Earlier on Thursday, Mrs May met Hiroaki Nakanishi, chairman of Hitachi, Takeshi Uchiyamada, chairman of Toyota, and Hiroto Saikawa, chief executive of Nissan, to reassure them that she understood the importance of providing clarity about the Brexit process. UK government officials said that Mrs May’s three-day visit to Japan had been a success, pointing to a joint “vision statement” published by the two countries’ governments on Thursday that committed them to working “quickly” to establish a new economic partnership deal once the UK leaves the EU. But the statement made clear that the “immediate priority” for Japan remained the finalising of its trade deal with the EU, which the two sides had agreed on in principle in July. Mrs May told the press conference that her trip to Japan marked the next step in strengthening Britain’s relationship with Japan. “We have agreed that as we exit the EU we will work swiftly to establish a new agreement between our two countries,” she said. But there was a marked difference in language between the two sides, with Mr Abe sounding cautious about the risks of Brexit both at the press conference and at an earlier Japan-UK business forum attended by hundreds of business executives. “In the EU exit negotiation, there has to be transparency and predictability to minimise any damage on businesses,” he told the business forum earlier on Thursday. Mr Abe stopped short of committing to a rapid new trade deal after Brexit at the business forum, saying only that the two leaders would continue to discuss the issues. “We will talk about the co-operation between these two countries,” Mr Abe said. “I look forward to that co-operation.” The UK government has seen Japan as one its most promising targets for securing a post-Brexit trade agreement. Japanese companies have £40bn of investments in the UK. The pending EU-Japan trade deal provides an up-to-date framework for a potential future agreement. Mrs May stressed on Thursday that the UK would enjoy greater freedom after Brexit to shape its trade policy, telling the business forum that Britain would be “free to engage more actively and independently”, particularly in “key Asian markets like Japan” after it leaves the bloc in March 2019. Thursday’s press conference and a banquet with Mr Abe marked the end of Mrs May’s political activities in Japan. She will have a meeting with Emperor Akihito before flying back to London on Friday morning. Read again Theresa May looks to reassure Shinzo Abe over Brexit : http://ift.tt/2iKYpADBoth the UK and EU have expressed frustration at the pace of Brexit talks amid disagreement over the size of the UK's "divorce bill". EU negotiator Michel Barnier said the UK did not feel "legally obliged to honour its obligations" after Brexit. He said "no decisive progress" had been made on key issues, following the third round of talks. But Brexit Secretary David Davis said the UK had a "duty to our taxpayers" to "rigorously" examine the EU's demands. And he urged the EU to be "more imaginative and flexible" in its approach. 'Impatient, not angry'During a joint press conference, Mr Barnier acknowledged there had been some "fruitful" discussions on the issues surrounding the relationship between the Republic of Ireland and Northern Ireland, but he struck a pessimistic tone overall. He stressed that he was "impatient… I am not angry… I am impatient and determined" about the progress of negotiations, adding that "time is flying" and the EU was willing to intensify the "rhythm" of talks. Analysis by BBC Europe Correspondent Kevin ConnollyBehind their polished podium performances, it's clear there are major gaps between the stance of Michel Barnier and David Davis which are not being bridged. Money is the big sticking point of course, although the phraseology around the issue is a little more elegant than that, and the language at these moments can give you a real feel for the underlying atmosphere. Mr Barnier says that after this week "it's clear that the UK doesn't feel legally obliged to honour its obligations". Mr Davis claims it's natural that the UK would want to "interrogate rigorously" any demand placed on its taxpayers. But he is also careful to note that Britain is a country that meets its obligations - moral as well as legal; it just expects them to be properly specified. The UK wants to begin trade talks as soon as possible, but Brussels insists that discussions about the future relationship after Brexit can only begin once "sufficient progress" has been made on the arrangements for withdrawal - including on the so-called "divorce fee". Mr Barnier said that at the current rate of progress, he was quite far from being able to recommend opening parallel talks on a future trade relationship with the UK. He cited two areas where "trust" needed to be built between the two sides - on citizens' rights and the financial settlement, stressing that 27 members of the bloc should not have to pay for obligations taken by 28. Claiming there had been a shift in the UK government's approach, he said: "In July the UK recognised that it has obligations beyond the Brexit date but this week the UK explained that these obligations will be limited to the last payment to the EU project before departure." No figure has yet been put on the payment, but European Commission president Jean-Claude Juncker has suggested it could come in at around 60 billion euro (£55bn), while unconfirmed reports have put it as high as 100 billion euro (£92bn). 'Difficult exchanges'Mr Davis defended the "rigorous" line-by-line examination of the EU's demands carried out by British officials in response to the "unspecified but undoubtedly large" sum demanded by Brussels. He added: "It will, of course, lead to difficult exchanges - nobody will pretend it was anything but a tough exchange this week - but I think the British taxpayer would expect nothing less." Mr Davis also told reporters the talks had exposed how the UK approach was "substantially more flexible and pragmatic than that of the EU". "This week we have had long and detailed discussions across multiple areas and I think it's fair to say we have seen some concrete progress, and Michel referred to one but there's more than that," he said. "However, as I said at the start of the week, it's only through flexibility and imagination that we will achieve a deal that works truly for both sides. "In some areas we have found this from the [European] Commission's side, which I welcome, but there remains some way to go." He added: "Beyond the debates about process and technicalities, at the heart of this process, must be a desire to deliver the best outcome for the people and the businesses of the European Union and the United Kingdom," he added - particularly on citizens' rights. Read again 'Divorce bill' row frustrates Brexit talks : http://ift.tt/2xOUXrzOne of the riddles of the Brexit negotiations is the rights that citizens in Northern Ireland should have after the U.K. leaves. As part of the 1998 Good Friday Agreement that brought peace to Northern Ireland, British nationals living there are also entitled to Irish (and by extension EU) citizenship -- even if they’ve never set foot south of the border. While unusual, that was straightforward enough when both countries were in the EU. Now it opens up a legal and political minefield. If you’re an EU citizen you have recourse to the European Court of Justice. But, as part of Brexit, Theresa May has vowed to end the ECJ’s jurisdiction in the U.K. So what if, after the U.K.’s withdrawal in March 2019, you’re a citizen of Northern Ireland, and therefore live in the U.K., but want to use your European citizenship to take a case to the ECJ? Like countless Brexit issues, there’s no easy answer. And in this case there’s the added worry of upsetting the fragile, and hard-won, peace. Negotiators say they’re beginning to make progress on this topic. But they reckon the Irish question will still throw up even trickier conundrums. Read again The Northern Irish Riddle Giving Brexit Negotiators a Headache : http://ift.tt/2x9CYPo[unable to retrieve full-text content] [unable to retrieve full-text content] The Brexit negotiations are deadlocked. From the large issues like Britain’s divorce bill, to the small technical ones like reciprocal health care, progress is scarce. That makes the chances of the U.K. being allowed to move on to trade talks in October increasingly slim, according to Guy Verhofstadt, the European Parliament’s Brexit coordinator. The European Union blames Britain’s reluctance to set out its positions; Britain says the EU isn’t flexible enough to compromise. "To be flexible you need two points, our point and their point," EU chief Brexit negotiator Michel Barnier told reporters on the sidelines of talks in Brussels on Wednesday. "We need to know their position and then I can be flexible." Inside the negotiating rooms of Brussels there’s frustration at the stalemate. These examples, as related by people familiar with the U.K. negotiating position, show why a deal is so elusive. The billNegotiations over the U.K.’s financial settlement have barely got started. The U.K. has refused to reveal its position because it thinks not showing its hand gives it more leverage. So far, British negotiators have restricted themselves to picking holes in the EU’s stance, the people said. While the issue is highly political, some of the disagreements are deeply technical. The EU’s budget plan is worked out over a period of seven years, with the current one starting in 2014. The EU contends that because the U.K. signed up to this plan four years ago it’s liable for the ensuing commitments. The U.K. argues that since each seven-year budget is broken down into annual portions -- which have to be agreed each year by all EU governments -- it shouldn’t be on the hook for the years after it’s left. Falling sickBritish travelers get free emergency health care in the EU if they carry a European Health Insurance Card. It means hospitals from Lisbon to Warsaw get reimbursed by the U.K.’s National Health Service for treating a U.K. citizen. And it’s reciprocal: European travelers get the same benefits when in the U.K. The U.K. wants this to continue after Brexit but says the EU won’t allow it because of what it sees as rigid adherence to regulations that say the program can only be used in their member states. Supply chainsThis was meant to be the easy bit. Both the U.K. and the EU have published positions on how to keep supply chains moving freely in the days after Britain leaves the bloc. With so many goods manufactured in more than one EU country, packaged in another and sold in yet another, an agreement is crucial. Again, British officials believe the EU’s refusal to waver from the wording of their negotiating mandate, and a narrow interpretation of the supply chain, are blocking progress. Read more: Britain’s Not-So-Sweet Options for EU Trade Deal Cross-border commutersBoth sides agree that frontier workers -- people who live in one country and commute to work in another -- should have special rights under the Brexit deal. Neither the U.K. nor the EU wants Brexit to mean that people who live in, say, Brussels, and take the two-hour train to work in London every week, suddenly have to leave their jobs. But while the negotiators have managed to agree in principle to the idea, there’s still argument over the definition of who should be classed as a frontier worker. Being judgedThe role of the European Court of Justice looms over much of the Brexit negotiations, not least how the overall deal should be enforced. But there are more technical issues too, such as what to do about proceedings concerning the U.K. that are underway but not concluded when the country leaves the EU. Britain says that while the ECJ should be allowed to rule on cases it’s already dealing with on Brexit day, it shouldn’t be able to start new ones, even if the facts occurred before the U.K.’s withdrawal. The EU argues that the ECJ should be able to deal with cases after the U.K. leaves if the facts occurred beforehand. Read again Devil in the Detail: Why Brexit Talks Are Making Little Progress : http://ift.tt/2vtmhyX |
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