Economy

In search of middle ground on Brexit border

The EU has long said the UK is either in or out of the single market

Many wise voices are continuing to warn about the difficulties ahead in finding common ground and warning of a hard Brexit

Sat Mar 31 2018 - 05:24

Serious work is under way on the issue of the Irish Border ahead of the next EU summit in June, we are told. But if this is to be fixed it is likely that not only the UK but also the EU will have to agree to cross what they have presented as red lines.

The likely outcomes might now be put into three separate pots. One is that the UK rows back on its commitment to leave both the EU single market and customs union. Were it to stay in both there would be no Border problem, and even retaining membership of the customs union – or “a” customs union – would help. At the far end of the spectrum, many wise voices are continuing to warn about the difficulties ahead in finding common ground and warning of a hard Brexit.

And here is where we start to look at the middle ground where a solution might be found. Politico reported this week that the UK would put forward a plan which would see all of the UK remaining in the EU single market for goods after Brexit. It would also involve a new customs arrangement between the EU and UK. Together, London would claim, the Border issue would be solved.

Well, not quite. And here we get to the red lines. The UK remaining in the single market for goods would be a neat solution to part of the problem, removing potential divergences in rules and regulations which would necessitate border checks. But the EU has long said that the UK is either in or out of the single market, and may see this as “ cherry-picking”.

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In the customs area, however, it is the UK which needs to rethink and abandon one of its red lines. It seems the emerging plan still involves the UK applying different tariffs to goods coming in through UK ports but designed for the EU market, along with technological methods to track the movement of these goods. It has never been done anywhere before, and is likely to meet extreme scepticism from the EU.

But any other route involves the UK conceding it cannot do new trade deals with third countries on its own terms after Brexit.

Despite all the talking so far, the red lines remain. Businesses would be right to remain sceptical.

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