Following Britain’s vote in June to leave the European Union, home secretary Theresa May rose from the political wreckage to become prime minister and impose a degree of calm with her vague assurance that “Brexit means Brexit”. European leaders, led by Germany’s Angela Merkel, accepted that the British government needed time to reflect before it formally applied to leave the EU.
Mrs May is now coming under increasing pressure to clarify her position when she addresses the ruling Conservative Party conference this week. As the triumphalism attending the referendum vote recedes, the pro-leave camp is now learning that it is one thing to win a mandate to leave the EU, it is quite another make that objective a reality. Although the government is facing little danger from a fratricidal opposition in parliament, Mrs May’s principal worry is that the Brexit question is now reopening long-standing cleavages in her own party.
Several of her most senior ministers, including foreign secretary Boris Johnson and international trade secretary Liam Fox, favour a “hard Brexit” in which Britain would leave the European Economic Area’s single market, impose stronger immigration controls and cease contributing to the EU budget. More Europhilic Conservatives believe it is critically important to remain part of the single market and seek the closest possible relationship with the EU. Former chancellor of the exchequer George Osborne recently cautioned against Britain being drawn to the “dangerous purity of splendid isolation”.
Though Mrs May has sought to play for time before revealing her own hand, the intense debate within the UK has been accompanied by ominous warnings from abroad of the consequences of further procrastination. Leading US bank executives have warned her that their operations in London would be scaled down if uncertainty persisted. Japanese diplomats and business leaders have also hinted that substantial investments in Britain might be at risk if the government opted to leave the single market.
European intentions have been harder to read beyond the firm refusal of all other 27 member states and the European Commission to begin any formal negotiations until London requests to leave the EU under Article 50 of the Lisbon Treaty. The most salient problem is how to square the circle of Britain retaining single market access while imposing restrictions on immigration and free movement. Enthusiastic “Brexiteers” such as Mr Johnson believe that a compromise can be negotiated; the other EU governments are united in insisting that it cannot.
London may ultimately have to wait until after next year’s French and German elections before the road ahead becomes clearer. If May can hold off the advocates of a “hard Brexit” calling for an immediate break, this could work to her advantage. It is possible that European governments, rattled by a further surge of populism in next year’s elections, will revisit the issue of migration restrictions and finesse a solution acceptable to the UK that can be promoted under the guise of a pan-EU agreement. The right of free movement in the Schengen zone has already been temporarily suspended in some instances after recent terrorist attacks.
The former president of France Nicolas Sarkozy, who is running for office again next April, has called for a new European treaty to both revive the EU’s appeal and allow the UK to back away from its referendum decision. Mr Sarkozy, an increasingly strident critic of Brussels elitism and who believes that the EU is losing the battle against the revival of populist nationalism, has called for reform of the Schengen zone, lessening the commission’s powers, deeper Eurozone integration and ruling out any prospect of Turkey joining the bloc.
The May government needs to make the most of this goodwill if it is to resolve its dilemma. Despite the predictions of immediate recession being off the mark, international confidence in the UK economy is only holding up because there is still hope that single market access won’t be affected. Reaching a deal will be an intricate process requiring imaginative diplomacy if Britain is to avoid serious political and economic disruption.
Regrettably, the lack of engagement with the serious issues during the referendum campaign is taking a serious toll. When parliament resumes after the Conservative Party conference, the first Brexit-related issue on the agenda is a debate about the recommissioning of the Royal Yacht Britannia to promote international trade. This move follows calls for the reintroduction of imperial weights and measures, and the reintroduction of traditional blue covers for UK passports. Outsiders could be forgiven for thinking that rather than expressing a wish to take on a new global role, the Leave vote represents a nostalgic tendency to introversion and yearning for an imaginary lost golden age.
Though Brexit hardliners will rage against any compromise that sells their cause short, the reality is that Mrs May has to face down one of the wings of her party sooner or later, and that the political and business arguments are strongly for a “soft Brexit”. Those who assumed that the referendum had settled the issue of Britain’s relationship with Europe are having to adjust to a new reality; the vote was in fact a trigger for a political struggle for the soul of a country that will play out for years and maybe decades.
Stephen Blackwell is an international politics and security analyst
