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Brexit: Are We There Yet?

by John Brian Shannon

As the Brexit negotiating process drags on perhaps Theresa May has a grand negotiating strategy - leave everything 'til the end - and then, negotiate furiously.

As the Brexit negotiating process drags on, perhaps Theresa May’s grand negotiating strategy is to leave everything until the end — and then negotiate furiously. Let us hope!

As of today, we’re 286 days from the official Brexit date and much remains to be done, and for all the squallering about it, not much has happened. At least, not that the public can see.

Yes, a final Brexit date has been set, Prime Minister Theresa May has agreed to pay a £20 exit fee (or perhaps as much as 40 billion according to some reports) to the European Union, there may (or may not be) an interim period when the UK is partly in and partly out of the UK (and without EU representation during that interim period — even though the UK will continue to pay billions to the EU) no trade deal has been agreed, nor have customs issues been resolved.

And all of it built upon the principle that ‘nothing is agreed until everything is agreed’ which means that the UK has effectively nothing if negotiations go awry.

Further, the Good Friday Agreement could be endangered if the ‘no agreement’ scenario comes to pass.

Not very confidence inspiring.


Perhaps All is Not Lost

Negotiators have different ways of obtaining agreements and sometimes the most effective strategy is to wait until the end of the negotiating cycle and hit ’em hard with a deal they just can’t refuse just as the last few days tick off the calendar. Which is a legitimate negotiating plan, if, if, if, that’s what the plan is.

There’s something to be said for playing ‘defence’ (watching the other side to get familiar with their tactics and devices) as EU negotiators play ‘offense’ using all their ammunition to try to slow, obfuscate, or completely derail Brexit.

In short, it might be better for the UK to let the EU expend all of its effort — and withstand that barrage — then at the last-minute, the United Kingdom suddenly offers up a trade deal that the European Union can’t pass up.

If that’s Theresa May’s strategy to deliver Brexit to UK voters, it’s a good one. But only if she and the MP’s whose constituents voted for Brexit can withstand the ongoing negotiating and media blitz for 286 more days.

Otherwise, she will fail, and so will Brexit.

Risky (if you have a weak team) and brilliant (if your team is strong)

We shall see…

How Brexit Could Create a Better UK/EU Relationship

by John Brian Shannon

As European Union negotiators can’t see any reason to support Brexit, they will continue to keep the European Union’s best interests in mind — which is to say, they will try to stop, slow, obfuscate, or otherwise derail the Brexit process by almost any means possible.

And why shouldn’t they feel that way? The EU is a net beneficiary of £8.6 billion annually courtesy of the UK, so there’s little incentive to stop a contribution that is larger than that of all other EU-member countries except Germany.

If there are any Brexit benefits to the European Union, nobody has bothered to tell EU negotiators or EU media channels.

So how would anyone know if there will be Brexit benefits for the EU when the UK government hasn’t mentioned them once? And yet there are likely many Brexit benefits — for both sides — that just aren’t being discussed.


How to Sell a Product or Idea

When you’re trying to sell apples to a potential customer, giving them a nonstop spiel about how much *you* like apples won’t help you sell many apples!

But if you hand your potential customer a hot glass of mulled apple cider and walk them past appealing displays of fresh apples, followed by a pleasant tour through the on-site bakery bursting with the aroma of piping hot apple pies and offer them a tantalizing sample at the exact moment their interest in apples is high, you’ll sell more apples.

If you’re selling cars, you don’t spend your time telling the customer about the specifications of the car and how it can transport you here and there with ease. Any ol’ car can do that.

Instead, you answer their questions about the car, you offer a test drive so they can experience how much better it drives, sounds, and looks than their present car, all of which work together to help them fall in love with the car you’re selling.

If you’re a really smart salesperson, you’ll slap a dealer plate on the new car and let your customers take it home for the weekend so they can show it off to their comrades who will help convince them the new car is much better than their old jalopy.

And have you ever noticed that beer commercials don’t show you endless cans of beer and a quick snapshot of the brewery?

Breweries are highly experienced marketers and they want to show you good-looking people having a great time socializing with their friends and family in a picturesque setting or while engaged in enjoyable activities.

Look at that product placement! There’s the can of beer right beside those sizzling steaks on the barbecue while those great people in the background are enjoying their evening.

Considering a run to the beer store? Well yes you should — because you’re a good person, you work hard, you love spending quality time with your friends and family and you deserve a summer’s evening just like the people on that commercial. That’s the message.

Marketing types call this Feature/Benefit selling, ‘Selling the sizzle, not the steak’ which isn’t about what the product or service actually is, it’s about what it can do for you and how it can make you look or feel happier and better.


What Isn’t Theresa May Doing?

She isn’t selling the benefits of Brexit to the EU.

We know there are many benefits for Britons but even that has been under-sold.

In the early days following the Leave referendum it might’ve looked to Remainers as though Brexit could still go either way, so Theresa May was probably wise to move cautiously at first. But that time has passed. Almost every person and business in Britain wants to get beyond the present period of uncertainty and get on with creating a fresh start for the UK outside the European Union.

The right time to begin crafting a trade agreement that works even better than the present trading system has arrived. And now that we’re at this point in time, under-selling the benefits of Brexit to UK and EU citizens is not the way forward.


What Is The Way Forward?

In a word, Vision.

Theresa May needs to put on her ‘Steve Jobs hat’ and figure out what the best possible Brexit vision looks like from both the UK and EU perspectives.

Starting with a completely clean sheet; What would that look like in its entirety? What would it look like five years on?

If she doesn’t offer an inspiring vision that a majority of people on both sides of the English Channel can ‘buy-in’ to her government will be paddling upstream all day, every day, for as long as she remains Prime Minister. (And that’s definitely a no-fun lifestyle, even for a British PM)

Once the vision has been considered by Theresa May, only then should it be communicated to her Cabinet, while the Department for Exiting the European Union (DExEU) should oversee all other UK ministries and departments as they compile reports that describe what their best-case scenario would look like in practical terms.

Then it’s simply a matter of working to those ideals as much as is practicable to create a Vision Statement that can be released to the public, sans the excruciating detail required in government policy papers.

“This is the Vision we’re working toward…” (Giving UK and EU citizens a view of what a better Brexit looks like)

‘How do you like those apples?’ someone cheekily asked.


The Three Principles Common to all Organizations

  1. Vision (or Mission)
  2. Leadership
  3. Management

Without equal weight given to each of those three factors any organization or project will ultimately fail.

It can’t be emphasized enough; Endless discussion about the best Brexit from the UK standpoint are irrelevant to European Union citizens and businesses. Brexit must work for the EU too, or it will be increasingly uncomfortable and expensive for the UK as time rolls forward.

Theresa May needs to find what things will work better for the EU in a post-Brexit world and promote those items on every visit to the EU. If there aren’t any Brexit positives for the EU, she better create some as they negotiate forward to a final trade and financial services agreement.

Without an overarching vision even the best management and leadership will underperform. Perhaps severely.

But as soon as May gives the order to each of her 25 Ministerial Departments and 20 non-Ministerial Departments to submit their best-case scenario (their best hopes and aspirations showing what their jurisdiction could look like five years on from Brexit) and from that she will be able to write a one page vision for each of the 45 departments.

From there she will need to direct the Department for Exiting the European Union to create a list of items that could be seen as positives by EU governments, EU businesses and EU citizens. Those are the apples she needs to sell on every visit to the European Union. And then sell the ‘sizzle’ Theresa, not the steak.


Summary

Theresa May must ‘create’ and ‘sell’ (Vision + Leadership + Management + Marketing) a Brexit that will benefit both the UK and the EU and begin to disseminate that better vision throughout both blocs.

Throwing £40 billion at the EU now and (potentially) another £40 billion to obtain a trade and financial services agreement isn’t visionary — it’s ‘buying an agreement’ with taxpayer’s money — which is fine if that’s the only option. But it isn’t the only option.

Getting citizens, businesses, and governments on both sides of the English Channel to buy-in to a grand vision that works even better than the present paradigm without it costing another £40 billion, must be Theresa May’s Number One Priority before the October 2018 Brexit deal-making deadline arrives.


[P.S. to Michel Barnier, chief negotiator for the European Union] Jeez, Michel, for £40 billion shouldn’t the UK have received a bespoke customs deal, a bespoke trade deal, a bespoke financial services agreement *and* a chocolate mint on every UK pillow?

Theresa May’s New Year of Hope

by John Brian Shannon

As far as years go, UK Prime Minister Theresa May must be glad to see the end of 2017 as are many others in Britain and around the world. In matters Brexit, it was a year of low-level chaos and unfulfilled expectations — lots of ‘churn’ but not much actual progress.

Yet the Prime Minister did make some exceptional speeches and unexpectedly reached-out to EU citizens to assure them that while Britain was leaving the European Union, it wasn’t leaving Europe. Well done on both counts, Theresa.

She also told EU citizens living in the UK that their situation wouldn’t change, aside from having to register their residency with the Home Office and pay a nominal fee to retain their ‘settled status’. And while that didn’t seem to impress small numbers of EU negotiators, it brought great comfort to millions of expats living in Britain.

Of course, it’s all contingent upon reaching a final ‘Withdrawal Agreement’ between the United Kingdom and the European Union, but it’s not too much of a stretch to suggest that the UK would act unilaterally to guarantee the rights of EU citizens working or studying in Britain in the case of no agreement.

Theresa May also offered £40 billion of UK taxpayer money to the European Union; Everyone is unclear what this is for, as nobody from the government has bothered to explain it to citizens.

Many people think that the UK’s share in the EU Parliament buildings and in other EU properties and assets should be sold off to the other EU27 members and the £9.65 billion (estimated) value could be used to pay future UK liabilities to the EU and that there is no need to pay £40 billion. Which seems reasonable.

If there is an actual need for the UK to pay £40 billion to the EU, surely British taxpayers have the right to know what they’re paying for, and to whom.

But if Theresa May has agreed to continue paying the £8.6 billion annual net payment to the European Union until Brexit completes within 2 years (approximately) plus 2 more years to cover the transition period, then that seems pretty reasonable too. If that’s how the £40 billion is being arrived at, there’s not much to complain about there.


With all this reasonableness going ’round it’s no wonder that EU negotiators agreed to move to Phase II of the Brexit negotiations — trade — a hyper-important part of the post-Brexit relationship on both sides of the English Channel.

Negotiating a mutually beneficial trade agreement between the UK and the EU in 2018 is Job Number One for negotiators on both sides.

Trade between the United Kingdom and the EU27 ranks as one of the most robust trading relationships in the world

  • 44% of UK exports are sold to the EU27, making them Britain’s most important trade partner.
  • 16% of EU exports are sold to the UK, making Britain the EU27’s most important trade partner.

Which makes the whole ‘getting an agreement’ discussion largely academic — as there will be an agreement or hundreds CEO’s on both sides of the English Channel will be breathing fire down the necks of UK and EU negotiators every day until an agreement is reached. “Don’t even think about coming home without an agreement!” (Yes, just like that)


UK/EU Trade: Where do United Kingdom Exports Go?


Where do UK exports go? UK Office for National Statistics 2015.


UK/EU Trade: Where do European Union Exports Go?


The EU's largest single export market is the UK. European Commission Export Helpdesk.


So There We Have It: They Can’t Live With Each Other, But They Can’t Live Without Each Other!

Which is a very good thing.

And because companies on both sides need to keep their biggest export market open and flourishing, there absolutely will be a reasonable trade deal — one that both sides can live with. There is simply no alternative.

Which neatly explains the title of this blog post ‘Theresa May’s New Year of Hope’ because Job Number One for Brexit negotiators on both sides must be working a successful trade deal — and every CEO in Europe will be watching with keen interest, to put it very mildly.

You don’t want to be the trade negotiator coming home without a deal and having to tell the CEO of Volkswagen or BP that you were too incompetent to get a deal. Yikes!

There will be an excellent UK/EU trade deal in 2018, a trade accord that both sides will be rightly proud of — one that works for CEO’s, citizens and governments throughout Europe.


Trade As Saviour

As the focus will be on trade in 2018 (something that both sides must preserve if today’s politicians want to keep their jobs) the new year looks to be one of the better years for relations between the UK and the EU27.

Let’s hope that Phase II of the Brexit negotiations move smartly along and that (if a Phase III is required) the momentum that gets built throughout 2018 works to facilitate friendly and workable solutions to any remaining issues between the two blocs.

Politicians and negotiators on both sides of the Brexit divide have everything to gain by bringing home a fair and workable trading agreement and everything to lose if they don’t.

Therefore, let 2018 be ‘The Year of Hope’ as 512 million European citizens are counting on their politicians and negotiators to open windows of opportunity as big as the sky, and to create even more justice and fairness for all Europeans, no matter where in Europe they may live, work, or play.

No matter which side of Brexit you’re on, we at Letter to Britain wish you a Happy, Safe, and Prosperous New Year!