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In the Brexit Home Stretch there are Only Three Possibilities

by John Brian Shannon

In the Brexit home stretch it looks like nobody is happy, which is a situation that negotiators and their backers often encounter and no one should extrapolate any great conclusions from the recent commentary or resignations of leading actors in the Brexit play, for the simple reason that when emotions run high common-sense usually runs out the window.

Even MP’s in cabinet can get jittery nerves, while others can suddenly lack the necessary conviction to see it through to its inevitable conclusion — or they decide they can’t trust their leader which seems to be the flavour of the week, this week.

But it’s important to remember that Article 50 was lawfully triggered and Brexit will occur and by process of deductive reasoning we find there are only three remaining Brexit scenarios:

  1. A ‘Good Deal’ Brexit proposal is one that the UK cabinet can read, understand, and have access to the legal paperwork. But it will still need to pass through the House of Commons before it can become law.
  2. A ‘Bad Deal’ Brexit proposal is one that the UK cabinet can read, understand, and view the legal paperwork on, but it’s one that might trigger an exodus of cabinet ministers while providing an opportunity for Theresa May to get the cabinet she needs to get Brexit done and dusted. Along with plenty more negotiations to gain either a ‘Good Deal’ Brexit — or if time runs out — default to a ‘No Deal’ Brexit.
  3. A ‘No Deal’ Brexit proposal (through no fault of Theresa May because it takes two to tango and Theresa May has surely done her part in the long-running negotiations) is one that would need to be explained to the British public and would need a high level of oversight to prepare for and implement over the next 4-months.

In the case of the Good Deal Brexit proposal, all sides in the Brexit negotiations would celebrate and find themselves starring in hundreds of fawning interviews that would work to build their political credentials allowing them to go on to ever-brighter futures. Why this isn’t the #1 default option for everyone involved in the Brexit process is beyond the ability of civilized human beings to fathom.

In the case of a Bad Deal Brexit proposal that Theresa May would share with her cabinet colleagues, it would be a case of carefully considering each chapter and verse on its merits and then offering counter-proposals to the Prime Minister that she could subsequently present to EU negotiators. A Bad Deal Brexit proposal in essence, becomes a cabinet brainstorming session to counter EU concerns and objections. Simply put, a Bad Deal proposal means negotiations aren’t over yet.

And in the case of a No Deal Brexit proposal it means that negotiations have ended and Theresa May’s government — with great sense of purpose and speed — must take all necessary actions to help UK citizens, businesses, and all levels of government prepare for a No Deal Brexit scenario.


Legitimate Items of Concern

  • As the Prime Minister begins to finalize the eventual ‘Good Deal’ Brexit proposal — you know, the one that is 95% ready and approved by both sides and just needs a solution to the Northern Ireland border question — it’s completely legitimate that Theresa May’s cabinet wants more details and wants to see the legal briefings on the ramifications of such a deal. That interest should be welcomed by the Prime Minister once she presents that proposal to cabinet. However, her cabinet Secretaries and Ministers mustn’t take that as license to interfere in Brexit negotiations. Rather, it means they should be warmly invited by the PM to read, discuss, question, and even challenge points within any Brexit proposal presented by her to the cabinet in the spirit of creating a better Brexit document.
  • Theresa May has valiantly travelled Europe for the past 2-years selling her version of Brexit to EU leaders and negotiators. Sometimes that can have the effect of the leader becoming too attached to the work-in-progress and over time, the leader can lose their objectivity. This isn’t a knock against Theresa May it’s a knock against all human beings, for it is a uniquely human failing to fall in love with the policy you’re promoting — even if the other side has made alterations to it or has chosen to interpret it differently than its primary authour. While Theresa May should receive plenty of latitude from her cabinet (and even moreso from her non-cabinet caucus) for as long as negotiations continue, when it comes time to evaluate the Brexit deal she presents to her cabinet let’s hope she doesn’t try to bully the document past her cabinet, but instead chooses to allay their concerns using logic and reason.
  • If the EU’s tactic is to delay and delay — the more Theresa May and her government are seen to be preparing for a ‘No Deal’ Brexit — the sooner the CEO’s of Mercedes Benz, BMW and Volkswagen, etc., will prevail upon EU negotiators to gain a proper Brexit agreement. As long as the Prime Minister ‘gets that’ the UK can’t lose. Let’s hope Theresa May is bright enough to see it for what it is and has the internal fortitude to drive EU negotiators right to the deal she wants. I can’t help but feel that Theresa May sees this tactic as her weakest hand when in reality it is her strongest hand.

As long as Prime Minister Theresa May stays strong the UK will enjoy a ‘Good Brexit’ but if she weakens — either by her own party tearing her apart or by the EU draining her confidence — the UK (and the EU corporate world and EU consumers) will suffer for many years on account of a substandard Brexit deal.

Therefore my Brexit friends; Strengthen your team captain to ensure her success and her success will be your success. Or, her failure will be your failure and you will surely wear it at the next election.

Theresa May: United Nations Speech September 2018

UK Prime Minister speech to the UN General Assembly: September 26, 2018

Prime Minister Theresa May spoke on behalf of the UK at the UN General Assembly 2018

Transcript

On behalf of the United Kingdom let me begin by paying tribute to an outstanding leader of this United Nations, who sadly passed away this summer.

Kofi Annan was one of the great Secretaries General, a tireless campaigner for peace and progress, and a champion of human rights and human dignity – whose influence will continue to be felt around the world for years to come.

Over the course of his lifetime he witnessed the extraordinary progress that we as a community of nations have made since this organisation was founded.

Progress in which we have more than halved the number of people living in extreme poverty in this century alone.

Progress in which the number of people killed in conflicts has fallen by three-quarters in just over three decades.

And progress in which millions of our citizens lead healthier and longer lives and where – thanks to advances in human knowledge – in medicine, in science and in technology – we are presented with huge opportunities in the years ahead.

Yet today – many are concerned about whether this progress will continue, and fearful about what the future holds.

For the end of the Cold War did not – as many once believed – lead to the inevitable supremacy of open economies and liberal democracies co-operating on the global stage for the common good.

Today instead we face a loss of confidence in those very systems that have delivered so much.

The belief in free markets has been challenged by the financial crisis of 2008, by the concerns of those feeling left behind by globalisation, by the anxieties about the pace and scale of technological change and what that will mean for jobs, and by the unprecedented mass movements of people across borders with all the pressures that can bring.

And after the military interventionism at the beginning of the century, people question the rationale – and indeed legitimacy – of the use of force and involving ourselves in crises and conflicts that are not ours. While at the same time being repelled by the slaughter in Syria and our failure to end it.

These doubts are entirely understandable. So too is the demand for leadership. So those of us who believe in inclusive societies and open economies have a duty to respond: to learn the lessons of the past, to meet people’s concerns with practical actions not beguiling illusions and to renew our confidence in the ideas and values that have done so much to benefit so many for so long.

For be in no doubt, if we lack the confidence to step up, others will.

In the last century – whether in the rise of fascism or the spread of Communism – we have seen those on the extreme right and extreme left exploit people’s fears, stoke intolerance and racism, close down economies and societies and destroy the peace of nations. And today once more we see worrying trends in the rise of these movements in Europe and beyond.

We have seen what happens when countries slide into authoritarianism, slowly crushing the basic freedoms and rights of their citizens.

We have seen what happens when corrupt oligarchies rob their nations of the wealth, resources and human capital that are so vital to unlocking a brighter future for their citizens.

We have seen what happens when the natural patriotism which is a cornerstone of a healthy society is warped into aggressive nationalism, exploiting fear and uncertainty to promote identity politics at home and belligerent confrontation abroad, while breaking rules and undermining institutions.

And we see this when states like Russia flagrantly breach international norms – from the seizing of sovereign territory to the reckless use of chemical weapons on the streets of Britain by agents of the Russian GRU.

We have to show there is a better way to meet the concerns of our people.

That way lies in global cooperation between strong and accountable states based on open economies and inclusive societies.

That ensures strong nation states provide the bonds that bring citizens together and ensures power remains accountable to those it is there to serve.

That celebrates free markets and has the confidence to reform them when they need to work better.

And that demonstrates that delivering for your citizens at home does not have to be at the expense of global cooperation and the values, rules and ideals that underpin this.

Indeed cooperation and competition are not mutually exclusive.

Only global cooperation based on a set of agreed rules can ensure competition is fair and does not succumb to protectionism, with its certain path to lost jobs and international confrontation.

And it is only global co-operation which can harness legitimate self-interest towards common goals, producing agreements on global challenges such as climate change, proliferation and increasing inclusive economic growth.

We see this cooperation here today at this UN, as we also saw it at the Commonwealth Heads of Government meeting earlier this year.

And here today – as Chair-in-Office of the Commonwealth – I deliver a clear statement on behalf of the Heads of Government of its fifty-three equal and independent member states. We reaffirm our shared commitment to work together within a rules based international system to address shared global challenges and foster a fairer, more secure, more sustainable and more prosperous future. This commitment takes account of the special requirements of least developed countries, and of small and otherwise vulnerable economies, and it benefits all our citizens and the wider world.

But it is not enough for us merely to make the case for cooperation. We need action, at home and in the community of nations, to show how our ideas and values can deliver practical benefits for all our people in all parts of the world.

We must recognise the legitimacy of people’s concerns and act to build a global economy that works for everyone.

We must invest in the patient work of building open societies in which everyone has a stake in the future.

And we must act to uphold the international rules based system – and stand up for our values by protecting those who may suffer when it is violated.

Let me take each in turn.

First, we must respond to those who feel that the global economy is not working for them.

The pace of globalisation that has left too many people behind.

The fear that our children and grandchildren may lack the education and skills to secure the jobs of tomorrow.

And the risk that technological change could become a source of inequality and division rather than the greatest opportunity in history.

In the UK we are driving investment in industries of the future to create new jobs – from low-carbon technologies to Artificial Intelligence.

We are investing in education and skills so that workers are ready to make the most of the opportunities that lie ahead.

And we are making sure people play by the rules – so that business and innovation is celebrated for creating jobs not demonised because of grievances over tax not paid or rights not respected.

And while we strive to make our own economies work for all our people – we should do the same at a global level.

In an increasingly global economy, it is not enough to ensure people play by the rules at home.

We need global co-operation to set and enforce fair rules on trade, tax and the sharing of data.

And these rules need to keep pace with the changing nature of trade and technology.

So we need to give the World Trade Organisation a broad, ambitious and urgent mandate to reform. This must address the areas where it is not functioning effectively; deal with issues that are not currently covered; and maintain trust in a system which is critical to preventing a return to the failed protectionism of the past.

Fair and respected rules are essential for business to flourish and drive growth. But recent history shows that this cannot be sustained without deeper partnerships between governments, business, international financial institutions and civil society to ensure that growth delivers for everyone.

That is why I recently visited Africa – along with British businesses – to promote trade and investment, and encourage a new partnership based on shared prosperity and shared security.

It is why at this General Assembly I co-hosted an event with Prime Minister Trudeau, Prime Minister Kagame and President Akufo-Addo calling for more support for investment and job creation for young people in the continent.

It is why the United Kingdom will maintain our commitment to spend 0.7 per cent of gross national income on official development assistance. And we will put our development budget at the heart of our international agenda, and do more to create jobs, improve skills and increase investment in emerging economies – in both our interests and theirs.

For the best way of resisting protectionism is to ensure that this century is defined by open markets that really deliver for all our people.

Second, we must build countries, not only economies, that work for everyone – inclusive societies where every citizen has a stake in the future.

These are the firm foundations on which strong and accountable nations are built. And history has consistently taught us that giving people a stake in society is the best way to ensure stability, security and economic growth.

There is no one right way to do this.

Every country must choose its own path.

But the basic tenets are common across the world.

They include a government that is transparent and accountable.

An independent judiciary to enforce the rule of law.

Free and fair elections and a free and open media.

The freedom of expression, a right to redress and property rights that are reliably enforced.

And equality, freedom of thought, opinion, religion and conscience – all found in the United Nations Universal Declaration of Human Rights, signed 70 years ago.

Those of us who believe in these tenets must set an example in defending and strengthening them at home and abroad.

That is why we must call out hate speech, anti-Semitism, Islamophobia and all forms of prejudice and discrimination against minorities wherever we find it.

Like many leaders, I suspect, I do not always enjoy reading what the media in my country writes about me. But I will defend their right to say it – for the independence of our media is one of my country’s greatest achievements. And it is the bedrock of our democracy.

So too, will I defend objectivity and impartiality in the face of those who treat truth as just another opinion to be manipulated.

This challenge has only become more complex with the rise in social media, and online information. That is why we agreed at the G7 Summit in June to step up our efforts to respond to disinformation. And why, together with our partners, and with tech companies, we are leading efforts to reclaim the internet from terrorists and others who would do us harm.

And just as we must stand up for the values that we adhere to, so we must support countries and leaders who choose to take the often difficult steps towards a more inclusive society.

The United Kingdom will use all the levers at our disposal to do so.

Through our aid budget and commitment to the Sustainable Development Goals we will not only protect the most vulnerable but also bolster states under threat and help others sustain their progress.

Through global campaigns we will help countries to end scourges such as modern slavery and sexual violence in conflict.

And we will mobilise wider support through our alliances and membership of multilateral organisations – not only the UN, but also international financial institutions, the G7, the G20 and NATO.

And just as there is no single recipe for an inclusive society, so there is no single model for balancing the democratic demands of our public with the imperative to co-operate internationally.

The vote by the British people to leave the European Union was not a rejection of multilateralism or international co-operation. It was a clear demand for decisions and accountability to lie closer to home.

I believe the role of leadership in these circumstances is clear: it is delivering on the democratic wishes of our people and international cooperation working with allies and partners in pursuit of our shared values.

Third, we must have the will and confidence to act when the fundamental rules that we live by are broken.

This is not about repeating the mistakes of the past by trying to impose democracy on other countries through regime change.

But we should not allow those mistakes to prevent us from protecting people in the face of the worst violations of human rights and human dignity. We should not allow those mistakes to paralyse the international community when its long-established norms are violated. And we should not let our inability to prevent some of the worst conflicts today stop us from making every effort to ensure they do not happen again in the future.

For if we stand back, we allow the world to become divided into spheres of influence in which the powerful dominate the weak, and in which legitimate grievances go unaddressed.

This is not just a moral imperative. It is also a matter of self-interest. For when barbarous acts and aggression go unchecked – dictators and terrorists are emboldened.

So, we must have the confidence to act.

When the Syrian Regime used chemical weapons on its people again in April, it was Britain together with France and America who took military action to degrade the Syrian regime’s chemical weapons capability and deter their use.

And when earlier this year, Russia used a toxic nerve agent in a sickening attack on the streets of Salisbury, the UK with our NATO, EU and other allies took action, expelling over 150 Russian intelligence officers: the largest collective expulsion ever.

In Burma, following the damning report of the United Nations fact-finding mission, we should show the same confidence to hold accountable those responsible for the appalling atrocities repeatedly inflicted by the Burmese military on the Rohingya, Shan and Kachin peoples since 2011.

Similarly we should gather evidence of Daesh’s crimes worldwide, so ensuring justice for their victims and deterring those who might conduct such crimes in the future.

But accountability alone is not enough. We must do more collectively to prevent such atrocities in the first place, and address the causes of instability that can give rise to them.

The United Nations has a critical role to play. And it has a wide range of levers to do so from sanctions – which show the leaders of Iran and North Korea that they cannot act without consequence – to peacekeeping missions such as that in South Sudan, which is helping to prevent suffering and the collapse of law and order.

But to be able to draw effectively on these levers, the Security Council must find the political will to act in our collective interest. The UN’s agencies must deliver the reforms that the Secretary General has started – to become more agile, more transparent and better coordinated on the ground. And to support these reforms, we must also ensure proper funding is targeted specifically at those parts of the UN that deliver results.

70 years ago the General Assembly agreed the Universal Declaration of Human Rights. Today we must renew the ideals and values on which that Declaration was founded.

In doing so, we must learn the lessons of the past and show through our actions how co-operation between strong and accountable states with open economies and inclusive societies can best deliver security and prosperity for all our people.

As Kofi Annan said at the start of his second term as Secretary General: “I have sought to turn an unflinching eye to the failures of our recent past, in order to assess more clearly what it will take for us to succeed in the future.”

In that spirit, let us show unflinching resolve to renew the promise of freedom, opportunity and fairness.

A promise which has delivered for more people, in more places than at any other period in our history.

And let us ensure that promise can be fulfilled for our children and grandchildren – and for every generation to come.

Thank you.


Published 26 September 2018

Transcript courtesy of GOV.UK

Theresa May Mansion House speech: March 2, 2018


Full transcript of Theresa May’s Mansion House speech (March 2, 2018) on the UK’s post-Brexit relationship with the EU


“I am here today to set out my vision for the future economic partnership between the United Kingdom and the European Union.

There have been many different voices and views in the debate on what our new relationship with the EU should look like. I have listened carefully to them all.

But as we chart our way forward with the EU, I want to take a moment to look back.

Eighteen months ago I stood in Downing Street and addressed the nation for my first time as Prime Minister.

I made this pledge then, to the people that I serve: I know you’re working around the clock, I know you’re doing your best, and I know that sometimes life can be a struggle.

The government I lead will be driven not by the interests of the privileged few, but by yours. We will do everything we can to give you more control over your lives. When we take the big calls, we’ll think not of the powerful, but you. When we pass new laws, we’ll listen not to the mighty but to you. When it comes to taxes, we’ll prioritise not the wealthy, but you. When it comes to opportunity, we won’t entrench the advantages of the fortunate few. We will do everything we can to help anybody, whatever your background, to go as far as your talents will take you.

We are living through an important moment in our country’s history.

As we leave the European Union, we will forge a bold new positive role for ourselves in the world, and we will make Britain a country that works not for a privileged few, but for every one of us.

That pledge, to the people of our United Kingdom is what guides me in our negotiations with the EU.

Five tests

And for me that means five things:

First, the agreement we reach with the EU must respect the referendum. It was a vote to take control of our borders, laws and money. And a vote for wider change, so that no community in Britain would ever be left behind again. But it was not a vote for a distant relationship with our neighbours.

Second, the new agreement we reach with the EU must endure. After Brexit both the UK and the EU want to forge ahead with building a better future for our people, not find ourselves back at the negotiating table because things have broken down.

Third, it must protect people’s jobs and security. People in the UK voted for our country to have a new and different relationship with Europe, but while the means may change our shared goals surely have not – to work together to grow our economies and keep our people safe.

Fourth, it must be consistent with the kind of country we want to be as we leave: a modern, open, outward-looking, tolerant, European democracy. A nation of pioneers, innovators, explorers and creators. A country that celebrates our history and diversity, confident of our place in the world; that meets its obligations to our near neighbours and far off friends, and is proud to stand up for its values.

And fifth, in doing all of these things, it must strengthen our union of nations and our union of people.

We must bring our country back together, taking into account the views of everyone who cares about this issue, from both sides of the debate.

As Prime Minister it is my duty to represent all of our United Kingdom, England, Scotland, Wales and Northern Ireland; north and south, from coastal towns and rural villages to our great cities.

So these are the five tests for the deal that we will negotiate.

Implementing the decision of the British people; reaching an enduring solution; protecting our security and prosperity; delivering an outcome that is consistent with the kind of country we want to be; and bringing our country together, strengthening the precious union of all our people.

Crucial moment

We are now approaching a crucial moment.

There is no escaping the complexity of the task ahead of us. We must not only negotiate our exit from an organisation that touches so many important parts of our national life. We must also build a new and lasting relationship while, given the uncertainty inherent in this negotiation, preparing for every scenario.

But we are making real progress. At the end of last year, we agreed the key elements of our withdrawal.

We are in the process of turning that agreement into draft legal text. We have made clear our concerns about the first draft the Commission published on Wednesday – but no-one should be in any doubt about our commitment to the Joint Report we agreed in December.

We are close to agreement on the terms of an implementation period which was a key element of December’s deal. Of course some points of difference remain – but I am confident these can be resolved in the days ahead.

Both the UK and the EU are clear this implementation period must be time-limited and cannot become a permanent solution. But it is vital to give governments, businesses and citizens on both sides the time they need to prepare for our new relationship.

With this agreed, I want both sides to turn all our attention and efforts to that new relationship.

But before we can do that, we need to set out in more detail what relationship we want, building on my Lancaster House and Florence speeches.

So last month, I spoke in Munich about the security partnership we seek. And today, I want to talk about the other pillar of that relationship: how we build our economic partnership.

Not Norway nor Canada

In my speech in Florence, I set out why the existing models for economic partnership either do not deliver the ambition we need or impose unsustainable constraints on our democracy.

For example, the Norway model, where we would stay in the single market, would mean having to implement new EU legislation automatically and in its entirety – and would also mean continued free movement.

Others have suggested we negotiate a free trade agreement similar to that which Canada has recently negotiated with the EU – or trade on World Trade Organisation terms.

But these options would mean a significant reduction in our access to each other’s markets compared to that which we currently enjoy.

And this would mean customs and regulatory checks at the border that would damage the integrated supply chains that our industries depend on and be inconsistent with the commitments that both we and the EU have made in respect of Northern Ireland.

This is a wider issue in our negotiations and I want to dwell on this for a minute.

Successive British governments have worked tirelessly – together with all the parties in Northern Ireland and with the Irish Government – to bring about the historic achievement of peace.

This is an achievement that we should all be proud of, and protect. That is why I have consistently put upholding the Belfast Agreement at the heart of the UK’s approach.

Our departure from the EU causes very particular challenges for Northern Ireland, and for Ireland. We joined the EU together 45 years ago. It is not surprising that our decision to leave has caused anxiety and a desire for concrete solutions.

We have been clear all along that we don’t want to go back to a hard border in Ireland. We have ruled out any physical infrastructure at the border, or any related checks and controls.

But it is not good enough to say, ‘We won’t introduce a hard border; if the EU forces Ireland to do it, that’s down to them’. We chose to leave; we have a responsibility to help find a solution.

But we can’t do it on our own. It is for all of us to work together. And the Taoiseach and I agreed when we met recently that our teams and the Commission should now do just that.

I want to make one final point. Just as it would be unacceptable to go back to a hard border between Northern Ireland and Ireland, it would also be unacceptable to break up the United Kingdom’s own common market by creating a customs and regulatory border down the Irish Sea. My personal commitment to this is clear.

As prime minister of the whole United Kingdom, I am not going to let our departure from the European Union do anything to set back the historic progress that we have made in Northern Ireland – nor will I allow anything that would damage the integrity of our precious Union.

Hard facts

So existing models do not provide the best way forward for either the UK or the EU.

But before I turn to what a new and better model might look like, I want to be straight with people – because the reality is that we all need to face up to some hard facts.

We are leaving the single market. Life is going to be different. In certain ways, our access to each other’s markets will be less than it is now. How could the EU’s structure of rights and obligations be sustained, if the UK – or any country – were allowed to enjoy all the benefits without all of the obligations?

So we need to strike a new balance. But we will not accept the rights of Canada and the obligations of Norway.

The second hard fact is that even after we have left the jurisdiction of the ECJ, EU law and the decisions of the ECJ will continue to affect us.

For a start, the ECJ determines whether agreements the EU has struck are legal under the EU’s own law – as the US found when the ECJ declared the Safe Harbor Framework for data sharing invalid.

When we leave the EU, the Withdrawal Bill will bring EU law into UK law. That means cases will be determined in our courts. But, where appropriate, our courts will continue to look at the ECJ’s judgments, as they do for the appropriate jurisprudence of other countries’ courts.

And if, as part of our future partnership, Parliament passes an identical law to an EU law, it may make sense for our courts to look at the appropriate ECJ judgments so that we both interpret those laws consistently.

As I said in Munich, if we agree that the UK should continue to participate in an EU agency the UK would have to respect the remit of the ECJ in that regard.

But, in the future, the EU treaties and hence EU law will no longer apply in the UK. The agreement we reach must therefore respect the sovereignty of both the UK and the EU’s legal orders. That means the jurisdiction of the ECJ in the UK must end. It also means that the ultimate arbiter of disputes about our future partnership cannot be the court of either party.

The next hard fact is this. If we want good access to each other’s markets, it has to be on fair terms. As with any trade agreement, we must accept the need for binding commitments – for example, we may choose to commit some areas of our regulations like state aid and competition to remaining in step with the EU’s.

The UK drove much of the policy in this area and we have much to gain from maintaining proper disciplines on the use of subsidies and on anti-competitive practices.

Furthermore, as I said in Florence, we share the same set of fundamental beliefs; a belief in free trade, rigorous and fair competition, strong consumer rights, and that trying to beat other countries’ industries by unfairly subsidising one’s own is a serious mistake.

And in other areas like workers’ rights or the environment, the EU should be confident that we will not engage in a race to the bottom in the standards and protections we set. There is no serious political constituency in the UK which would support this – quite the opposite.

Tensions

Finally, we need to resolve the tensions between some of our key objectives.

We want the freedom to negotiate trade agreements with other countries around the world. We want to take back control of our laws. We also want as frictionless a border as possible between us and the EU – so that we don’t damage the integrated supply chains our industries depend on and don’t have a hard border between Northern Ireland and Ireland.

But there are some tensions in the EU’s position too – and some hard facts for them to face as well.

The Commission has suggested that the only option available to the UK is an ‘off the shelf’ model.

But, at the same time, they have also said that in certain areas none of the EU’s third country agreements would be appropriate.

And the European Council’s Guidelines aspire to a balanced, ambitious, and wide-ranging deal, with common rules in a number of areas to ensure fair and open competition.

This would not be delivered by a Canada-style deal – which would not give them the breadth or depth of market access that they want. And it is hard to see how it would be in the EU’s interests for the UK’s regulatory standards to be as different as Canada’s.

Finally, we both need to face the fact that this is a negotiation and neither of us can have exactly what we want. But I am confident we can reach agreement.

Future partnership

We both want good access to each other’s markets; we want competition between us to be fair and open; and we want reliable, transparent means of verifying we are meeting our commitments and resolving disputes.

But what is clear is that for us both to meet our objectives we need to look beyond the precedents, and find a new balance.

As on security, what I am seeking is a relationship that goes beyond the transactional to one where we support each other’s interests.

So I want the broadest and deepest possible partnership – covering more sectors and co-operating more fully than any Free Trade Agreement anywhere in the world today. And as I will go on to describe we will also need agreements in a range of areas covering the breadth of our relationship.

I believe this is achievable because it is in the EU’s interests as well as ours.

The EU is the UK’s biggest market – and of course the UK is also a big market for the EU. And furthermore, we have a unique starting point, where on day one we both have the same laws and rules.

So rather than having to bring two different systems closer together, the task will be to manage the relationship once we are two separate legal systems.

To do so, and to realise this level of ambition, there are five foundations that must underpin our trading relationship.

First, our agreement will need reciprocal binding commitments to ensure fair and open competition.

Such agreements are part and parcel of any trade agreement. After all, why would any country enter into a privileged economic partnership without any means of redress if the other party engaged in anti-competitive practices?

But the level of integration between the UK and EU markets and our geographical proximity mean these reciprocal commitments will be particularly important in ensuring that UK business can compete fairly in EU markets and vice versa.

A deep and comprehensive agreement with the EU will therefore need to include commitments reflecting the extent to which the UK and EU economies are entwined.

Second, we will need an arbitration mechanism that is completely independent – something which, again, is common to Free Trade Agreements.

This will ensure that any disagreements about the purpose or scope of the agreement can be resolved fairly and promptly.

Third, given the close relationship we envisage, we will need to have an ongoing dialogue with the EU, and to ensure we have the means to consult each other regularly.

In particular we will want to make sure our regulators continue to work together; as they do with regulators internationally. This will be essential for everything from getting new drugs to patients quickly to maintaining financial stability. We start from the place where our regulators already have deep and long-standing relationships. So the task is maintaining that trust; not building it in the first place.

Fourth, we will need an arrangement for data protection.

I made this point in Munich in relation to our security relationship. But the free flow of data is also critical for both sides in any modern trading relationship too. The UK has exceptionally high standards of data protection. And we want to secure an agreement with the EU that provides the stability and confidence for EU and UK business and individuals to achieve our aims in maintaining and developing the UK’s strong trading and economic links with the EU.

That is why we will be seeking more than just an adequacy arrangement and want to see an appropriate ongoing role for the UK’s Information Commissioner’s Office. This will ensure UK businesses are effectively represented under the EU’s new ‘one stop shop’ mechanism for resolving data protection disputes.

And fifth, we must maintain the links between our people.

EU citizens are an integral part of the economic, cultural and social fabric of our country. I know that UK nationals are viewed in entirely the same way by communities across the EU. And this is why at every stage of these negotiations, I have put the interests of EU citizens and UK nationals at the heart of our approach.

We are clear that as we leave the EU, free movement of people will come to an end and we will control the number of people who come to live in our country.

But UK citizens will still want to work and study in EU countries – just as EU citizens will want to do the same here, helping to shape and drive growth, innovation and enterprise.

Indeed, businesses across the EU and the UK must be able to attract and employ the people they need. And we are open to discussing how to facilitate these valuable links.

Market access

Reciprocal commitments to ensure fair and open competition, an independent arbitration mechanism, an ongoing dialogue, data protection arrangements and maintaining the links between our people. These are the foundations that underpin the ambition of this unique and unprecedented partnership.

It will then need to be tailored to the needs of our economies.

This follows the approach the EU has taken with its trade agreements in the past – and indeed with its own single market as it has developed.

The EU’s agreement with Ukraine sees it align with the EU in some areas but not others. The EU’s agreement with South Korea contains provisions to recognise each others’ approvals for new car models, whereas their agreement with Canada does not. Equally, the EU’s agreement with Canada contains provisions to recognise each others’ testing on machinery; its agreement with South Korea does not.

The EU itself is rightly taking a tailored approach in what it is seeking with the UK. For example, on fisheries, the Commission has been clear that no precedents exist for the sort of access it wants from the UK.

The fact is that every Free Trade Agreement has varying market access depending on the respective interests of the countries involved. If this is cherry-picking, then every trade arrangement is cherry-picking.

Moreover, with all its neighbours the EU has varying levels of access to the Single Market, depending on the obligations those neighbours are willing to undertake.

What would be cherry-picking would be if we were to seek a deal where our rights and obligations were not held in balance. And I have been categorically clear that is not what we are going to do.

I think it is pragmatic common sense that we should work together to deliver the best outcome for both sides.

Trade in goods

Let me start with how we do this for goods.

This is the area where the single market is most established and both the UK and the EU have a strong commercial interest in preserving integrated supply chains that have built up over forty years of our membership.

When it comes to goods, a fundamental principle in our negotiating strategy should be that trade at the UK-EU border should be as frictionless as possible.

That means we don’t want to see the introduction of any tariffs or quotas. And – as the Secretary of State for Exiting the European Union set out in his speech in Vienna last week – we must ensure that, as now, products only need to undergo one series of approvals, in one country, to show that they meet the required regulatory standards.

To achieve this we will need a comprehensive system of mutual recognition.

The UK will need to make a strong commitment that its regulatory standards will remain as high as the EU’s. That commitment, in practice, will mean that UK and EU regulatory standards will remain substantially similar in the future.

Many of these regulatory standards are themselves underpinned by international standards set by non-EU bodies of which we will remain a member – such as the UN Economic Commission for Europe, which sets vehicle safety standards. Countries around the world, including Turkey, South Africa, South Korea, Japan and Russia, are party to the agreement.

As I said in my speech in Florence this could be achieved in different ways.

Our default is that UK law may not necessarily be identical to EU law, but it should achieve the same outcomes.

In some cases Parliament might choose to pass an identical law – businesses who export to the EU tell us that it is strongly in their interest to have a single set of regulatory standards that mean they can sell into the UK and EU markets.

If the Parliament of the day decided not to achieve the same outcomes as EU law, it would be in the knowledge that there may be consequences for our market access.

And there will need to be an independent mechanism to oversee these arrangements.

We will also want to explore with the EU, the terms on which the UK could remain part of EU agencies such as those that are critical for the chemicals, medicines and aerospace industries: the European Medicines Agency, the European Chemicals Agency, and the European Aviation Safety Agency.

We would, of course, accept that this would mean abiding by the rules of those agencies and making an appropriate financial contribution.

I want to explain what I believe the benefits of this approach could be, both for us and the EU.

First, associate membership of these agencies is the only way to meet our objective of ensuring that these products only need to undergo one series of approvals, in one country.

Second, these agencies have a critical role in setting and enforcing relevant rules. And if we were able to negotiate associate membership we would be able to ensure that we could continue to provide our technical expertise.

Third, associate membership could permit UK firms to resolve certain challenges related to the agencies through UK courts rather than the ECJ.

For example, in the case of Switzerland, associate membership of the European Aviation Safety Agency means that airworthiness certifications are granted by its own aviation authority, and disputes are resolved through its courts. Without its membership, Swiss airlines would need to gain their certifications through another member state or through the Agency, and any dispute would need to be resolved through the ECJ.

Fourth it would bring other benefits too. For example, membership of the European Medicines Agency would mean investment in new innovative medicines continuing in the UK, and it would mean these medicines getting to patients faster as firms prioritise larger markets when they start the lengthy process of seeking authorisations.

But it would also be good for the EU because the UK regulator assesses more new medicines than any other member state. And the EU would continue to access the expertise of the UK’s world-leading universities.

And, of course, Parliament would remain ultimately sovereign. It could decide not to accept these rules, but with consequences for our membership of the relevant agency and linked market access rights.

Customs partnership

Lastly to achieve as frictionless a border as possible and to avoid a hard border between Northern Ireland and Ireland, we also need an agreement on customs.

The UK has been clear it is leaving the Customs Union. The EU has also formed a customs union with some other countries.

But those arrangements, if applied to the UK, would mean the EU setting the UK’s external tariffs, being able to let other countries sell more into the UK without making it any easier for us to sell more to them, or the UK signing up to the Common Commercial Policy.

That would not be compatible with a meaningful independent trade policy. It would mean we had less control than we do now over our trade in the world. Neither Leave nor Remain voters would want that.

So we have thought seriously about how our commitment to a frictionless border can best be delivered. And last year, we set out two potential options for our customs arrangement.

Option one is a customs partnership between the UK and the EU. At the border, the UK would mirror the EU’s requirements for imports from the rest of the world, applying the same tariffs and the same rules of origin as the EU for those goods arriving in the UK and intended for the EU.

By following this approach, we would know that all goods entering the EU via the UK pay the right EU duties, removing the need for customs processes at the UK-EU border.

But, importantly, we would put in place a mechanism so that the UK would also be able to apply its own tariffs and trade policy for goods intended for the UK market. As we have set out previously, this would require the means to ensure that both sides can trust the system and a robust enforcement mechanism.

Option two would be a highly streamlined customs arrangement, where we would jointly agree to implement a range of measures to minimise frictions to trade, together with specific provisions for Northern Ireland.

First, measures to ensure the requirements for moving goods across borders are as simple as possible.

This means we should continue to waive the requirement for entry and exit declarations for goods moving between the UK and the EU. And we should allow goods moving between the UK and the rest of the world to travel through the EU without paying EU duties and vice versa.

Second, measures to reduce the risk of delays at ports and airports. For example, recognising each other’s “trusted traders” schemes and drawing on the most advanced IT solutions so that vehicles do not need to stop at the border.

Third, we should continue our cooperation to mitigate customs duty and security risks. And fourth, measures to reduce the cost and burden of complying with customs administrative requirements, including by maximising the use of automation.

And recognising the unique circumstances in Northern Ireland, and our shared commitments to avoiding a hard border, we should consider further specific measures.

80% of North-South trade is carried out by micro, small and medium sized businesses. So for smaller traders – who as members of the community are most affected but whose economic role is not systemically significant for the EU market – we would allow them to continue to operate as they do currently, with no new restrictions.

And for larger traders we would introduce streamlined processes, including a trusted trader scheme that would be consistent with our commitments.

Both of these options for our future customs arrangement would leave the UK free to determine its own tariffs with third countries – which would simply not be possible in a customs union.

I recognise that some of these ideas depend on technology, robust systems to ensure trust and confidence, as well as goodwill – but they are serious and merit consideration by all sides.

So to conclude on goods, a fundamental principle in our negotiating strategy is that trade at the UK-EU border should be as frictionless as possible with no hard border between Northern Ireland and Ireland.

We believe this can be achieved via a commitment to ensure that the relevant UK regulatory standards remain at least as high as the EU’s and a customs arrangement.

We recognise this would constrain our ability to lower regulatory standards for industrial goods. But in practice we are unlikely to want to reduce our standards: not least because the British public would rightly punish any government that did so at the ballot box.

Farming and fishing

This approach to trade in goods is important for agriculture, food and drinks – but here other considerations also apply.

We are leaving the Common Agricultural Policy and will want to take the opportunity that brings to reform our agriculture and fisheries management.

The UK has among the highest environmental and animal welfare standards of any nation on earth. As we leave the EU we will uphold environmental standards and go further to protect our shared natural heritage. And I fully expect that our standards will remain at least as high as the EU’s.

But it will be particularly important to secure flexibility here to ensure we can make the most of the opportunities presented by our withdrawal from the EU for our farmers and exporters.

We are also leaving the Common Fisheries Policy. The UK will regain control over our domestic fisheries management rules and access to our waters.

But as part of our economic partnership we will want to continue to work together to manage shared stocks in a sustainable way and to agree reciprocal access to waters and a fairer allocation of fishing opportunities for the UK fishing industry. And we will also want to ensure open markets for each other’s products.

Trade in services

Just as our partnership in goods needs to be deeper than any other Free Trade Agreement, so in services we have the opportunity to break new ground with a broader agreement than ever before.

We recognise that certain aspects of trade in services are intrinsically linked to the single market and therefore our market access in these areas will need to be different.

But we should only allow new barriers to be introduced where absolutely necessary.

We don’t want to discriminate against EU service providers in the UK. And we wouldn’t want the EU to discriminate against UK service providers.

So we want to limit the number of barriers that could prevent UK firms from setting up in the EU and vice versa, and agree an appropriate labour mobility framework that enables UK businesses and self-employed professionals to travel to the EU to provide services to clients in person and that allows UK businesses to provide services to the EU over the phone or the internet.

And we want to do the same for EU firms providing services to the UK.

And given that UK qualifications are already recognised across the EU and vice versa – it would make sense to continue to recognise each other’s qualifications in the future.

There are two areas which have never been covered in a Free Trade Agreement in any meaningful way before – broadcasting and, despite the EU’s own best efforts in the Transatlantic Trade and Investment Partnership, financial services.

But we have some ideas for how we can do this – and it is in all our interests to explore these.

On broadcasting, we recognise that we cannot have exactly the same arrangements with the EU as we do now. Currently, because of the “country of origin” principle, a company based in the UK can be licence by Ofcom and broadcast into any EU member state and vice versa.

The relevant directive will not apply to the UK, as we leave the EU, and relying solely on precedents will hurt consumers and businesses on both sides.

The UK’s creative hub leads to the development of products that European consumers want – the UK currently provides around 30% of the channels available in the EU. But equally, many UK companies have pan-European ownership, and there are 35 channels and on-demand services, which are offered in the UK but licensed in the EU.

So we should explore creative options with an open mind, including mutual recognition which would allow for continued trans-frontier broadcasting – recognising the enriching role that British broadcasters and programme makers play, not only in British – but more broadly in our common European – culture.

Financial services

Similarly, on financial services, the Chancellor will be setting out next week how financial services can and should be part of a deep and comprehensive partnership. We are not looking for passporting because we understand this is intrinsic to the single market of which we would no longer be a member. It would also require us to be subject to a single rule book, over which we would have no say.

The UK has responsibility for the financial stability of the world’s most significant financial centre, and our taxpayers bear the risk, so it would be unrealistic for us to implement new EU legislation automatically and in its entirety.

But with UK located banks underwriting around half of the debt and equity issued by EU companies and providing more than £1.1 trillion of cross-border lending to the rest of the EU in 2015 alone, this is a clear example of where only looking at precedent would hurt both the UK and EU economies.

As in other areas of the future economic partnership, our goal should be to establish the ability to access each others’ markets, based on the UK and EU maintaining the same regulatory outcomes over time, with a mechanism for determining proportionate consequences where they are not maintained.

But given the highly regulated nature of financial services, and our shared desire to manage financial stability risks, we would need a collaborative, objective framework that is reciprocal, mutually agreed, and permanent and therefore reliable for businesses.

There are many other areas where the UK and EU economies are closely linked – including energy, transport, digital, law, science and innovation, and education and culture.

On energy, we will want to secure broad energy co-operation with the EU. This includes protecting the single electricity market across Ireland and Northern Ireland – and exploring options for the UK’s continued participation in the EU’s internal energy market.

We also believe it is of benefit to both sides for the UK to have a close association with Euratom.

On transport, we will want to ensure the continuity of air, maritime and rail services; and we will want to protect the rights of road hauliers to access the EU market and vice versa.

On digital, the UK will not be part of the EU’s Digital Single Market, which will continue to develop after our withdrawal from the EU.

This is a fast evolving, innovative sector, in which the UK is a world leader. So it will be particularly important to have domestic flexibility, to ensure the regulatory environment can always respond nimbly and ambitiously to new developments.

We will want our agreement to cover civil judicial cooperation, where the EU has already shown that it can reach agreement with non-member states, such as through the Lugano Convention, although we would want a broader agreement that reflects our unique starting point.

And our agreement will also need to cover company law and intellectual property, to provide further legal certainty and coherence.

The UK is also committed to establishing a far-reaching science and innovation pact with the EU, facilitating the exchange of ideas and researchers. This would enable the UK to participate in key programmes alongside our EU partners.

And we want to take a similar approach to educational and cultural programmes, to promote our shared values and enhance our intellectual strength in the world – again making an ongoing contribution to cover our fair share of the costs involved.

In all these areas, bold and creative thinking can deliver new agreements that are in the very best interests of all our people – both in the UK and across the EU. And in the face of a worrying rise in protectionism, I believe such agreements can enable us to set an example to the world.

A beginning, not an ending

For the world is watching.

We should not think of our leaving the EU as marking an ending, as much as a new beginning for the United Kingdom and our relationship with our European allies.

Change is not to be feared, so long as we face it with a clear-sighted determination to act for the common good. Nor is Brexit an end in itself.

Rather, it must be the means by which we reaffirm Britain’s place in the world and renew the ties that bind us here at home. And I know that the United Kingdom I treasure can emerge from this process a stronger, more cohesive nation.

A United Kingdom which is a cradle for innovation; a leader in the industries of the future; a champion of free trade, based on high standards; a modern, outward-looking, tolerant country, proud of our values and confident of our place in the world.

This is an optimistic and confident future which can unite us all.

A Global Britain which thrives in the world by forging a bold and comprehensive economic partnership with our neighbours in the EU; and reaches out beyond our continent, to trade with nations across the globe.

The approach I have set out today would: implement the referendum result, provide an enduring solution, protect our security and prosperity, helps us build the kind of country we want to be, and bring our country together by commanding the confidence of those who voted Leave and those who voted Remain.

It is an approach to deliver for the whole of our United Kingdom and our wider family of overseas territories.

I am in no doubt that whatever agreement we reach with the EU, our future is bright. The stability and continuity of centuries of self-government, our commitment to freedom under the rule of law, our belief in enterprise and innovation, but above all, the talent and genius of all our people – and especially our young people – are the seeds of our success in the future, as they have been the guarantors of our success in the past.

I look forward to discussing our future partnership with our European friends.

Because although we are leaving the EU – and in that regard we will become separate – we are all still European and will stay linked by the many ties and values we have in common. And because it is only by working together that we will find solutions that work for all our peoples.

Yes, there will be ups and downs in the months ahead. As in any negotiation, no-one will get everything they want. We will not be buffeted by the demands to talk tough or threaten a walk out. Just as we will not accept the counsels of despair that this simply cannot be done.

We will move forward by calm, patient discussion of each other’s positions. It is my responsibility as Prime Minister to provide that leadership for our country at this crucial time. By following the course I have set out today, I am confident we will get there and deliver the right outcome for Britain and the EU.

A generation from now what will be remembered is not the rough and tumble of negotiation but whether we reached an enduring solution cast in the interests of the people we are all here to serve.

So my message to our friends in Europe is clear.

We know what we want.
We understand your principles.
We have a shared interest in getting this right.
So let’s get on with it.”


Transcript courtesy of BBC