Brexit 5: It goes on and on and on…

The United Kingdom will remain in the EU — for now, at least.

EU leaders, acting on a request from Prime Minister Theresa May, have once again postponed the deadline by which the UK will leave the EU. The new date has been set for 31 October – Halloween. It’s a day where people share long drawn-out horror stories, but the question of whether a Halloween Brexit date is considered a trick or treat remains, as ever, up for interpretation. But before you reach for your spooky Common Fisheries Policy costumes, the conditions of the extension are flexible. This means that if an agreement is decided beforehand, the UK could leave the EU much sooner than we think.

Meanwhile the Government is continuing to hold talks with the Labour Party which are aimed at achieving a consensus on how to break the deadlock in Parliament. Mrs May said: “Reaching an agreement will not be easy, because to be successful it will require both sides to make compromises. It is incumbent on both frontbenches to seek to work together to deliver what the British people voted for.”

In response, Mr Corbyn asserted: “The second extension in the space of a fortnight represents not only a diplomatic failure but another milestone in the government’s mishandling of the entire Brexit process.”

With chaos and cracks in the political system, the question hangs in the balance on whether it will be Remain or Leave that, ultimately, takes bat control.

Brexit chess

With all the Brexit shenanigans, surely the last thing we want to be thinking about is a drawn-out Conservative party leadership contest. Isn’t it? In fact, the new delay to Brexit has only reinvigorated those wanting to topple and replace the Prime Minister.

Remarks this week from the Governor of the Bank of England that a managed no-deal is less costly than crashing out have emboldened hard-line members of parliament for whom a no deal Brexit is the optimum outcome. Steve Baker MP, Deputy Chair of the pro-Brexit European Research Group and de facto Chief Whip, has taken to the airwaves to set out his preferred candidates: former Brexit Secretaries David Davis and Dominic Raab; former Foreign Secretary Boris Johnson; and former Pensions Secretary Esther McVey. All fervent Brexiteers who quit the Prime Minister’s cabinet in protest at her handling of Brexit.

Meanwhile, Remain supporting MPs within the Conservative Party are mobilising to ensure that none of Baker’s preferred candidates end up in Number 10 and are rallying behind contenders including current Foreign Secretary Jeremy Hunt, Home Secretary Sajid Javid, and current Pensions Secretary Amber Rudd.

Despite all these manoeuvres there’s one thing we should not forget; the incredible staying power of the Prime Minister.

Election fever

With the new Halloween deadline, the UK will be required to compete in EU elections if a deal is not reached before 22 May. Theresa May hopes that this will scare MPs into backing her deal with the alternative being an inevitably messy and expensive European election in the UK.

The various political parties are required to submit their candidates to the elections watchdog by 25 April. This will be an unnecessary drain on local party finances as political wannabees around the nation eye up a payout of EU funds. Running for European election is quickly becoming the most attractive temp job in the UK.

Nigel Farage triumphantly launched his new Brexit Party on twitter and its bid for European elections. Looking to replace UKIP, Mr Farage blamed his former party for letting the far-right take over, while UKIP countered this saying that the new party is just a vehicle for Farage to be reelected to the European Parliament. Many do not realise that all this time Nigel Farage has remained an MEP, looking for reelection, while simultaneously calling for his unemployment…

La Résistance

While many EU countries seemed eager to extend Article 50 for up to a year to avoid a hard Brexit, one notable exception fought hard against delaying it past October. Emmanuel Macron led the resistance against a long delay in this week’s EU summit where he insisted that further extensions would be detrimental for both sides. “It’s true that the majority was more in favour of a very long extension. But it was not logical in my view, and above all, it was neither good for us, nor for the UK” declared the French President.

The EU has demanded a series of conditions for the finally agreed six-month extension, such as the understanding that the EU will not reopen the withdrawal agreement (only the political declaration) and for the UK to hold European Parliament elections in May.

Earlier in the week it was reported that France had the support of Spain and Belgium to defend a brief extension of just a couple of months after 12 April if the UK had not come up with a new proposal by then. But in the end France and Belgium stood alone in their demand for a short extension. And with good reason, some estimates showed that Spain was facing as much as €1 billion in losses due to a likely decrease in tourism if a no deal-Brexit had taken place on 12th April, right before the summer season.

Brexit boost for the economy

The UK Office for National Statistics (ONS) has released new data showing that the UK’s GDP grew by 0.3% in the three months to February 2019, confounding the expectations of economists in the City.

The reason? According to the ONS’s qualitative evidence, it’s because of the intense stockpiling that has been taking place in the lead up to the original Brexit date of March 29th. The ONS showed that corresponding with that, the total trade deficit for goods and services imported versus exported widened by £5.5 billion in the three months to February.

Separately, the International Monetary Fund (IMF) this week published its World Economic Outlook, April 2019 forecasting that a no deal Brexit would severely damage the UK’s economy and could put the country into a two-year disruption with only a 0.8 % GDP growth in the first years after leaving the Union. It concludes that if a deal is ratified between the UK and the EU, the UK can expect modest growth of 1.2% for this year.