Hopes of a Brexit deal appear to be plummeting by the day. As British Prime Minister Theresa May travelled to Brussels in what was initially intended as a last-ditch bid to put a deal on paper, European Council president Donald Tusk overturned hopes of a breakthrough by declaring he had “no grounds for optimism” with regards to the deliberations. May, Tusk insists, must come up with “concrete proposals” if the impasse is to be broken.
Policymakers at the summit emphasized that most parts of the agreement have been sketched out, but there are certain key sticking points which are holding up the signing of a divorce deal.
The issue of the Irish border is one of the most pertinent, with the EU calling on Britain to agree to a “backstop” or fallback position to guarantee an open border between the EU’s Republic of Ireland and the UK’s Northern Ireland if the UK and the European bloc cannot agree on a future relationship.
The Irish dilemma
With Britain leaving the EU’s customs union and the single market, checks will be required on people and products crossing the Irish frontier. Despite these imperative controls, both London and Brussels recognise the need to avoid any physical infrastructure— or “hard border”— for fear of destabilising the tentative peace achieved in the 1998 Good Friday accord which ended three decades of bloody conflict on the island of Ireland.
Businesses and residents on either side of the 500km invisible line have further highlighted the importance of maintaining a free flow of traffic— at least 30,000 people cross the border each day for work.
Enter the EU’s backstop plan, which would see Northern Ireland indefinitely remaining within the EU’s single market and customs union, retaining EU tariffs and enforcing EU rules on quality standards.
May has nixed this proposal because it would effectively draw a border in the Irish Sea: something which the Northern Irish DUP, whose 10 MPs prop up May’s government, has categorically ruled out. The British counterproposal involves a temporary customs arrangement that includes the whole of Britain and a deadline of December 2021, which Brussels has rejected.
Challenges from food security to fleeing firms
Plenty of ink has already been spilt about the potential consequences of the UK crashing out of the European Union without a deal: amid the deceptively simple cries of “Brexit means Brexit” by the Leave lobby, the UK has taken the extraordinary measure of appointing a minister to oversee the protection of food supplies throughout the Brexit process. The move took British policymakers by surprise, including Scottish leader Nicola Sturgeon, who remarked that it was the first time the UK had had to create such a post since World War II and its days of food rationing.
The appointment nevertheless seems a necessary measure, given that British citizens and retailers alike have already begun stockpiling food.
Food industry insiders have warned that delays of a mere half hour at UK ports and the Irish border will put one-tenth of British firms at risk of bankruptcy. With half of Britain’s food coming from abroad, and most of it passing through EU ports, Britain’s food security after 29 March 2019 is in genuine jeopardy.
The potential economic consequences for the UK in the wake of its great divorce from Europe are similarly huge: the pound risks tumbling to historic lows, and firms have already begun to plan their “Brexodus”. Firms in the financial services sector, long the backbone of London’s economy, have plans to move more than 1,000 people to Frankfurt by the end of April next year in preparation for the split.
Lending giant Deutsche Bank AG last month announced plans to relocate client business out of the UK, indicating as many as 4,000 jobs are set to cross the Channel— or even the Irish Sea.
Arts and culture on the chopping block
Despite the wealth of articles agonising about what will happen to the UK next March, one glaring issue has been largely overlooked in the panic over the possibility of a “no deal” scenario. Britain’s arts and cultural sector is a rapidly growing part of the UK’s economy and a key element in the nation’s international prestige. The arts and culture industry as a whole is estimated to contribute some £11.8 billion to the British economy annually. That same sector, which voted 96% remain in the EU, stands to lose critical EU funding in the coming divorce and gain barriers to musicians planning to tour abroad, as well as a host of other challenges.
The sector’s future after Brexit has British policymakers sufficiently worried that a House of Lords sub-committee has sought greater clarification over government plans to protect the sector, insisting that it is essential that British musicians, for example, retain their ability to travel to Europe at short notice. “Individuals working in the UK cultural sector are highly mobile and have thrived on collaboration with people from all over the world,” insists Lord Michael Jay, chair of the committee, “negotiators will need to be flexible...any restrictions on EU citizens wishing to enter the UK to work may be matched by reciprocal restrictions on UK workers in the EU.”
It’s not just Britain’s artists and musicians that face losing their preeminent position on the world stage if the UK crashes out of the European bloc without a deal.
London has long played a central role in the world’s art market, edging out China for the second largest volume of art sales in the world and hosting influential auction houses like Christie’s. Since the Brexit vote, however, the UK’s market share of art sales has already fallen, and New York and Hong Kong stand to steal away further business if May’s government fails to secure a favourable trade deal.
The current peril that the British arts and cultural sector find itself in is just one more reminder of how much the UK stands to lose in the coming year. Without a deal to cushion the Brexit blow, the stage is certainly set for a brutal showdown.
