Opinion – Martin Wolf: The UK’s ‘coward game’ on brexit will end badly

Boris Johnson won the 2019 general election with a promise that he would complete the brexit. But he is not complete. Instead of stabilizing, post-divorce relationships are getting worse. Not surprisingly, they are more fragile where responsibilities remain shared. Fishing is one of those fields of contention. But the most dangerous by far is Northern Ireland.

In October 2019, Johnson declared that he had reached “a great new deal”. Now he would like to tear it up. This is characteristic, unfortunately. But it is dangerous not just for the UK, but also for the European Union and the West in general.

In a sense, brexit couldn’t be “completed” now. The end of a marriage transforms partners’ prospects for the future. If all else remains the same, the more economically dependent partner will also suffer the most.

In its Economic and Fiscal Forecast last month, the Office for Budgetary Responsibility (OBR) concluded that “since November 2016 our forecasts have assumed that total UK imports and exports will both end up being 15% lower than if we were to stay in the EU. This reduction in trade intensity drives the 4% reduction in potential long-term productivity that we assume will ultimately result from our exit from the EU.” To put this in context, it’s twice Covid’s estimated long-term cost and, at present values, £80 billion (£594 billion) in one year.

So far, the results are close to previous predictions. UK trade with the EU is shrinking compared to what would have happened otherwise. This will not be offset by other trades, and will impose perpetual costs.

But it could be a lot worse. Suppose traders and investors, foreign and domestic, conclude that they cannot rely on the negotiated framework for relations between the UK and its most important economic partners. Even worse, suppose the British government’s credibility as a partner is destroyed. Then the losses to the UK could substantially exceed those indicated by the OBR. They would also go far beyond mere economic costs.

How realistic are these fears? In a statement over the weekend, Irish Foreign Minister Simon Coveney suggested the EU could repudiate its post-Brexit trade deal if the British government followed through with its threat to suspend parts of the Northern Ireland deal. He warned that the UK was forcing a deal it knew was impossible. The UK is indeed pushing for radical change. In a combative speech in October, Johnson’s fighting chicken Lord David Frost said: “The EU now says that the protocol — drafted in extreme haste at a time of great uncertainty — can never be perfected when it is clearly causing problems. so significant, it would be an error of historical judgment.”

This is the language of repudiation. Particularly noteworthy is the implication that this protocol — consciously and, it must be supposed, knowingly agreed to by Johnson himself two years ago — was somehow “uncertain” and was drafted in “extreme haste.” In fact, its consequences were quite predictable. That’s why Theresa May, her predecessor, rejected the idea of ​​separating Northern Ireland from the rest of the UK in this way. If Johnson didn’t understand what he was signing, he was incompetent. If he understood, but had no intention of respecting the agreement he signed, it was dishonest.

This is not to say that the administration of this protocol could not be improved. The European Commission has made important proposals on the subject. But the UK’s insistence that it could deviate from European standards on food products would certainly create problems in its trade with Northern Ireland. And indeed it did.

Now, looking for a radical change in the agreement it consciously signed, the British government proposes to take “safeguard” measures. Such measures are permitted under Article 16 of the protocol. But, explains the latter, such “measures must be restricted in terms of their scope and duration to what is strictly necessary to remedy the situation”.

The UK’s desire to withdraw the role of the European Court of Justice from defining the European law governing the single market is far from “strictly necessary”. Furthermore, the EU would have the right to take its own rebalancing measures in response to such an act by the UK. Where this cycle of retaliation between neighbors would end, no one knows.

The optimistic view is that this “coward’s game” will end, as has happened before, with a botched deal: the EU will cave in a bit and the UK won’t get everything it wants. But there are obvious difficulties with this joyful vision.

The first is that endless attempts to negotiate the most contentious part of the withdrawal have soured relations and, even worse, will continue to do so: after all, Northern Ireland, the EU and the UK will not disappear.

The second is that such a move is bound to undermine the confidence in its commitments that every government needs. The UK can no longer hope to get away with the reputation of being “the treacherous Albion”.

The last is that the “coward’s game” must end in a clash of exactly the kind Coveney suggests. Maybe that won’t happen this time. But it seems increasingly that the British government will continue to do this until the EU fully folds or the clash hits. In the long run, the latter seems much more likely.

So what happens if the core parts of the UK-EU agreements fall apart? The economic effects will certainly be harmful. But much worse would be the breakdown of trust between leading democracies and eternal neighbors at a time of enormous challenges for these countries. These are risks that no one would dare to take. This dangerous “game” needs to stop. We have to move on.

Translated by Luiz Roberto M. Gonçalves