Never mind the Brexit deadline drama – the shape of our bad deal is clear

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Unlike almost every trade agreement in history, a UK-EU one will result in more friction and less cooperation than before

Ursula von der Leyen and Boris Johnson at a meeting in Brussels, 9 December 2020.
Ursula von der Leyen and Boris Johnson in Brussels, 9 December 2020: ‘Both sides will be worse off, though the UK will be the biggest loser.’ Photograph: Xinhua/REX/Shutterstock
Ursula von der Leyen and Boris Johnson in Brussels, 9 December 2020: ‘Both sides will be worse off, though the UK will be the biggest loser.’ Photograph: Xinhua/REX/Shutterstock

Last modified on Sun 13 Dec 2020 15.26 EST

As the seemingly interminable Brexit negotiations draw to their final conclusion, both Boris Johnson and the EU negotiators are reverting to type. For the EU, this means making – and then withdrawing – an 11th-hour proposal for a “ratchet clause” that would ensure “dynamic alignment” with “level-playing field conditions”. For Johnson, it meant a festival of xenophobia: first insulting the French, then threatening to use gunboats to fight EU fishermen, and finally causing deep offence to Angela Merkel and the German people. It is shaming.

Yet the talks continue. Though their methods may differ, both Britain and the EU have a common interest in raising the temperature in the last stage of thrashing out a deal. Just as Johnson plays the politics of the gutter press, the EU is also a political entity. For their own audiences, each has to give the impression of fighting for their interests to the bitter end. The two sides released an almost laughably downbeat joint statement at lunchtime saying the talks would go on. They are in this together, after all.

The contours of the Brexit deal are almost precisely the same as those set out by Theresa May’s Lancaster House speech nearly four years ago. Britain will be a “third country” to the EU, outside the customs union and the single market and all the other institutions. There will be a free-trade agreement that means there will be no restrictions on the quantity of goods Britain and the EU can sell to each other, nor on tariffs imposed upon them. But it will mean costly rules-of-origin and regulatory compliance checks at borders. And it will make trade in services – where the UK has a competitive advantage – much harder.

The main stumbling block is measures to ensure that trade is fair. If Britain and the EU are to allow unfettered access to each other’s markets, then there must be mechanisms in place to prevent undercutting – whether it takes the form of a race to the bottom in stripping workers’ rights and environmental protections, or artificially lowering the costs of production with direct or indirect state subsidies. For all the tedious railing against EU regulations by our own Europhobic grifters, it seems Johnson has already signed up to swallow the entire pre-existing EU rulebook through “non-regression” clauses in the draft agreement.

The disagreement that is still holding the deal back is about the future evolution of regulation. Both sides accept that there must be known and proportionate consequences for future changes in regulation that amount to unfair competition. For all the hot air over the weekend, it seems that the negotiating teams are working through various technical arrangements that each side can live with. It looks likely there will be a mechanism where sectoral tariffs can be imposed if there is unfair competition, with independent arbitration.

The other stumbling block is fishing. The idea that the EU had “stolen” our fish was one of the myths that fuelled Brexit. In truth, English fishermen sold off their quotas to foreign operators in the 1990s – in contrast to Scotland where 96% remains in Scottish hands. The UK exports 80% of the fish that it catches, mainly to EU countries. And fishing is a tiny industry contributing little to our economy or employment. It is the UN Convention on the Law of the Sea that requires Britain to negotiate access to its waters for its neighbours – and there is little chance that a politically and economically significant trade deal will be scuppered over fishing.

The eventual UK-EU deal will be perhaps the first trade agreement in history to envisage more friction rather than less, less economic cooperation and regulatory alignment rather than more. Both sides will be worse off because of it, though the UK is three times as exposed and will be the biggest loser. It suits Johnson to define success as having any deal rather than no deal – a threat that was a political hoax all along. And it suits the Labour party, which has come to believe that voting for Johnson’s deal is in its electoral interest. Titillated by the drama, British political commentators have played their part too, focusing on the fact of a deal rather than the quality of it. As has always been the case with Brexit, there was never a betrayal of Britain in Brussels; that only happens at Westminster.

• Tom Kibasi is a writer and researcher on politics and economics

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