UK-EU plan fails to offer ‘frictionless trade’ after Brexit

Theresa May’s draft plan for a post-Brexit trading arrangement with the EU has been met with a frosty reception from MPs across the political spectrum.

The prime minister had hoped last minute concessions on issues such as the Irish backstop, fishing and Gibraltar might have won over some Tory rebels, but her claim that her deal was one that would deliver the Brexit people voted for was rebuffed, “striking a potentially fatal blow to her chances of steering it through parliament”, says The Times.

What does the ‘political declaration’ say?

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Number 10 has confirmed that the prime minister’s much-maligned Chequers proposal has been ditched or rather superseded by the more open-ended political declaration.

“While the document is long on ambition it puts off many of the most difficult issues until after Britain leaves the bloc on 29 March,” says The Times.

In a nod to her plan for alignment on goods, the document says the two sides “envisage having a trading relationship on goods that is as close as possible”, but the EU and the UK would be separate markets with inevitable barriers to trade, and there is no reference to a common rulebook.

The Independent says a leaked draft of the document “shows the EU has agreed to soften some of its language”, but “the overall shape of the agreement, which lays the groundwork for Britain’s relationship with the EU for decades to come, is mostly unchanged – with warnings of border checks and new bureaucracy that the prime minister said she wanted to avoid”.

The political declaration “fails to offer any hope of frictionless trade, said to be vital to the British economy,” agrees The Guardian, “but provides Theresa May with arguments to bolster her hopes of selling the deal to Brexiters in parliament”.

Unlike earlier drafts, the final document explicitly states “freedom of movement” will end, “but if the freedoms are indivisible, that means the UK cannot have free movement of goods, services and capital. That contradiction is not solved by the rest of the document”, says John Rentoul in The Independent.

On the contentious issue of a customs union backstop, the prime minister appears to have secured language that could be used to convince her critics it may not be the only long-term solution.

The document claims that “facilitative arrangements and technologies will also be considered in developing any alternative arrangements for ensuring the absence of a hard border on the island of Ireland on a permanent footing”.

So what has the reaction been?

This olive branch to Brexiteers was roundly rejected by the harline European Research Group of Tory MPs who said: “The political declaration is not legally binding, vague, aspirational and little more than a smokescreen to cover up the fact that the permanent relationship is the customs union backstop.

The prime minister also found scant support for her agreement among other factions in the Commons.

Pro-Remain Tory MP Anna Soubry described it as a “syrup of warm sweet words about our future relationship” which would not match up to what Leave voters were promised, and was a “major step away” from the deal the UK currently has with the EU.

Meanwhile, Eurosceptic Tory MP Mark Francois described it as a “fig leaf”, which was not legally binding and was “26 pages of political camouflage designed to take people's eye off the withdrawal agreement and try to persuade them to vote it through”.

With one eye on the parliamentary arithmetic, Downing Street will also be worried about the noises coming from Scottish Tories, who are concerned the declaration will not protect the interests of the UK fishing industry.

By contrast, business groups have broadly welcomed the declaration. Josh Hardie, deputy director-general of the business lobbying group the CBI, told the BBC: “It appears that we're on the cusp of a much-needed agreement”.

“The progress made is a credit to both sets of negotiators. But hard work lies ahead. A 20-page vision needs to become a 2,000-page agreement that secures trade and jobs before the spectre of no deal can be put to rest.”

Markets also responded positively, with the pound rising sharply “on relief among investors that 18 months of tense negotiation were bearing fruit, keeping Britain close to its biggest market and ensuring nothing much will change for at least two years”, reports Reuters.

Agreement of the text paves the way for a special summit on Sunday at which the prime minister and the EU27 leaders will formally agree both the withdrawal agreement and political declaration.