EU agrees Brexit deal... now for the hard part

EU leaders agree to Teresa May's Brexit deal but the PM now has the harder task of getting the UK parliament's support whilst new reports forecast negative economic impacts.

Two girl cross Tower Bridge holding a Unit Jack flag
Agreement by EU27 leaders of the terms for the UK's withdrawal from the bloc has now left Prime Minister Theresa May with an even greater challenge: convincing the House of Commons to approve the deal.The 27 other EU leaders backed the Brexit terms at a summit on Sunday, along with a document that, in very vague terms, sets out the guidelines for negotiations of a trade deal between the EU and UK once the transition period ends, probably at the beginning of 2021.

Domestic politics threaten to undermine deal

However, while the rest of the Europe might be happy with the withdrawal agreement, Mrs May faces opposition from every other party in parliament and many of her own Conservative MPs, both those who favour a 'hard' Brexit and those who want to remain in the EU.A crucial vote on the deal is expected to be held on December 12 and, in the Commons on Monday, Mrs May launched her campaign to convince MPs to back the withdrawal terms, saying rejecting them would lead to "division and uncertainty"."Our duty as a parliament over these coming weeks is to examine this deal in detail, to debate it respectfully, to listen to our constituents and decide what is in our national interest," she said.The choice, she maintained, was backing the withdrawal arrangements so that the country could "move on to building a brighter future of opportunity" or rejecting them and "go back to square one".But Jeremy Corbyn, leader of the Labour Party, has described the agreement as representing "the worst of all worlds" while Northern Ireland's DUP, which the Tories rely on for a parliamentary majority, is threatening to withdraw its support from the government over the 'backstop' agreement that they fear could effectively force Ulster into a permanent customs union with the Republic.Meanwhile, pro-Brexit Conservative MPs object to the plan saying it gives the EU too much influence over the UK during the transition period and will restrict the UK's ability to strike free trade deals with other countries. For their part, pro-remain Tories object to it because they fear it will not guarantee frictionless trade with the EU.

Reports forecast negative economic impacts for both deal and no deal

Mrs May's case did not seem to be helped by a report on Monday from the National Institute of Economic and Social Research which concluded the withdrawal deal could leave the UK £100 billion worse off by 2030 than if it had remained in the EU.However, the report also said that if there was an 'orderly, no deal' Brexit, which some hardliners favour, GDP could be reduced by £140 billion by 2030.This latter scenario remains the worst as far as business leaders are concerned. Stephen Martin, director-general of the Institute of Directors, said the agreement by the EU on a withdrawal deal "marks a significant moment in the Brexit process".He added, "After what has seemed like slow progress over the last few months, many businesses began to fear that the UK and EU might never reach a deal on the terms of our exit.“However, this step on its own does not resolve the uncertainty for business. It is still far from clear how the UK parliament will decide to act. The deal the EU approved today provokes a wide range of reactions across the political spectrum, and indeed among business leaders, but the steer from our members is that avoiding 'no deal' must be the main priority.“This means that politicians of all parties must be clear about the consequences of their choice when it comes to vote. The EU has reiterated today they will not reopen the agreement. The possibility of a second referendum splits our members, with no majority either way. There is no perfect choice in this situation, only a balance of risks and trade-offs. Ratifying a withdrawal deal is currently the surest way to deliver certainty about the immediate future when the Article 50 timeline runs out next March, as is written into UK law.”
Follow the think for official communication explaining the UK Government's Brexit Deal.


Exhausted business want clarity

Adam Marshall, director-general of the British Chambers of Commerce, said: “While this is a milestone in the political process of Brexit, and a significant personal achievement for the prime minister, it’s just one more step on a long road for businesses exhausted by three years of nonstop political debate and growing uncertainty.“If the agreement clears the political hurdles ahead, there can be no pause for breath, and no let-up in the negotiations.“The fact is that businesses still need clarity and precision on the terms of trade they will face with the EU and many other countries within a matter of months. Firms need clarity and precision on who they can hire, what rules they need to follow, and what more the government will do to support them through this period of change.“The businesses that power our communities do not want to face the chaos of a messy and disorderly exit from the EU next March. As companies across the UK evaluate what this agreement means for them, parliamentarians must keep the millions of firms and families trying to plan for the future at the forefront of their minds.”

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