As the unpredictable European elections seem to look completely set to push back the Brexit talks by more than six months, one senior economist is of the view that U.K. Prime Minister Theresa May's resolution to complete Brexit negotiations within a two year timeframe could come back to haunt her.
Markus Kuger, senior economist at Dun & Bradstreet, is of the view that discussions on Brexit could be put on hold as late as until as late as September, when Germany goes to the polls to choose its new Chancellor, despite May's plans to trigger Article 50 in March and begin the related talks to finally break away from the European Union and for a new U.K.-EU relationship in March.
During this year, Germany's is the last of three major European elections to take place. While France would select its new president in April of this year, it wil be preceded by the Netherlands will select its new leader in March.
"There's no point making agreements when the government is changing. If you start negotiations and make tentative agreements with existing governments the incoming parties may not feel bound to it," Kuger said over the phone.
And in addition, in order to ratify any new arrangements, further time will then be needed at the end of the two year negotiation period.
Hence according to Kurger, before May’s self-imposed deadline of March 2019, these political compulsions will leave May with just over a year to commence and confirm new agreements with the EU.
Especially given that similar agreements, such as the CETA deal between the EU and Canada, took seven years to complete, this is a tall order, making it "highly unlikely" that a suitable deal will be reached, according to Kuger.
An "interim arrangement" that will come into force from Q1 2019 until a new deal is enacted is suggested by Kuger to cope with this uncertainty.
"The problem with an interim period is that the U.K. will have some bitter pills to swallow."
According to Kuger, either legislative limitations for an extended period or in the form of a concession to the free movement of people would be the answer to these concerns and [potential roadblocks.
However the EU will have to strike a fine balance to strike as it looks to secure the future of the economic bloc even though the EU will have a vested interest in allowing a transition period and upholding its relationship with the U.K.
"If Brexit is a success there are other countries like Finland and the Netherlands that have become increasingly hostile to the EU," he said.
"Once we see big countries leaving, like Italy and France, we will see the collapse of the EU."
(Source:www.cnbc.com)
Markus Kuger, senior economist at Dun & Bradstreet, is of the view that discussions on Brexit could be put on hold as late as until as late as September, when Germany goes to the polls to choose its new Chancellor, despite May's plans to trigger Article 50 in March and begin the related talks to finally break away from the European Union and for a new U.K.-EU relationship in March.
During this year, Germany's is the last of three major European elections to take place. While France would select its new president in April of this year, it wil be preceded by the Netherlands will select its new leader in March.
"There's no point making agreements when the government is changing. If you start negotiations and make tentative agreements with existing governments the incoming parties may not feel bound to it," Kuger said over the phone.
And in addition, in order to ratify any new arrangements, further time will then be needed at the end of the two year negotiation period.
Hence according to Kurger, before May’s self-imposed deadline of March 2019, these political compulsions will leave May with just over a year to commence and confirm new agreements with the EU.
Especially given that similar agreements, such as the CETA deal between the EU and Canada, took seven years to complete, this is a tall order, making it "highly unlikely" that a suitable deal will be reached, according to Kuger.
An "interim arrangement" that will come into force from Q1 2019 until a new deal is enacted is suggested by Kuger to cope with this uncertainty.
"The problem with an interim period is that the U.K. will have some bitter pills to swallow."
According to Kuger, either legislative limitations for an extended period or in the form of a concession to the free movement of people would be the answer to these concerns and [potential roadblocks.
However the EU will have to strike a fine balance to strike as it looks to secure the future of the economic bloc even though the EU will have a vested interest in allowing a transition period and upholding its relationship with the U.K.
"If Brexit is a success there are other countries like Finland and the Netherlands that have become increasingly hostile to the EU," he said.
"Once we see big countries leaving, like Italy and France, we will see the collapse of the EU."
(Source:www.cnbc.com)