Single market departure for Britain as part Brexit negotiation plan

Single market departure for Britain as part Brexit Negotiation planSingle market departure and a ‘bold and ambitious free trade agreement’ was a primary objective given by Prime Minster, Theresa May, in her Brexit speech on the 17th January 2017.

She highlighted that there will be no ‘half-in, half-out’ deals and that she is aiming for the UK to regain control of borders and break free from the restrictive EU judges in Brussels.

Listen to the full UK Brexit plan speech >>

What are the key principles of the 12 part Brexit negotiation plan and UK single market departure?

single market departure announced in brexit speechBefore delving into the 12 negotiation priorities set out by the Prime Minster, four key principles that would drive future agreements were set out:

  • Certainty and clarity
  • A stronger Britain
  • A fairer Britain
  • A truly global Britain

All of these attributes are set to contribute towards Theresa May’s plan for a clean Brexit.

“We have 12 objectives that amount to one big goal: a new, positive and constructive partnership between Britain and the European Union,”

“And as we negotiate that partnership, we will be driven by some simple principles: we will provide as much certainty and clarity as we can at every stage.

“And we will take this opportunity to make Britain stronger, to make Britain fairer, and to build a more Global Britain too.”

What is Theresa May’s 12 part Brexit Negotiation Strategy?

In simple terms, Theresa May’s plan for UK single market departure and Brexit negotiations is as follows:

  1. Provide certainty about the process of leaving the European Union.
  2. Regain control of our own laws: Leaving the European Union would mean that we are no longer governed by the European courts and that our laws will be made in Westminster, Edinburgh, Cardiff and Belfast.
  3. Strengthen the Union between the four nations of the United Kingdom.
  4. Deliver a practical solution that allows the maintenance of the Common Travel Area with the Republic of Ireland.
  5. Brexit must mean control of the number of people who come to Britain from Europe.
  6. single market departure announced in brexit speechProtect rights for EU nationals in Britain and British nationals in the EU. We need to guarantee rights of EU citizens living in Britain and the rights of British nationals in other member states, as soon as possible.
  7. Protecting the rights of workers by not only adopting the laws that protect them via EU legislation, but by building on them too.
  8. Create a bold and ambitious free trade agreement with the European Union.
  9. Develop trade agreements with other countries to create a truly global Britain.
  10. Continue our commitment to science and innovation. We will continue to collaborate with our European partners on major science, research and technology initiatives such as renewable energy developments.
  11. Co-operation in the fight against crime and terrorism. Britain will continue to work closely with our European allies in foreign and defence policy regardless.
  12. A smooth, orderly Brexit. A phased process of implementation will be in the interests of Britain, member states and EU institutions.

What impact has announcing single market departure and Brexit plans had on the pound?

single market departure announced in brexit speechThe value of the pound since Theresa May’s speech has rose to $1.23 (+2.49%) as she confirmed that both parliaments will vote on final Brexit decisions. This means that British currency could be on track for its biggest daily rise since the global financial crisis of 2008.

This has, however, has a negative effect on the FTSE 100, as the pounds additional value impacted the dollar-earning businesses on the UK’s leading business index.

Furthermore, the show of strength displayed by Theresa May, when she stated: ‘No deal for Britain is better than a bad deal’ has restored some confidence that the UK will not be a push over during the two year Brexit negotiation period.

What response has there been to Britain’s single market departure and Brexit plans?

There has been mixed reactions to the announcement of Brexit plans and single market departure:

The German foreign minister, Frank-Walter Steinmeier, has responded to Mrs May’s speech with the comments: “Finally, a bit more clarity”. He also added that the other 27 EU counties want “good, close and trusting” relations with Britain going forward.

“We welcome that the British prime minister is today outlining her government’s ideas for leaving and has finally created a little more clarity about the British plans. She has underlined that Great Britain is striving for a positive and constructive partnership, a friendship, with a strong EU. That is good.

“We too want the best, closest and most trusting relationship and wish for constructive negotiations with this goal. But our line is, and remains: the negotiations can begin only when Great Britain has given official notification of its desire to leave.”

Michael Hewson, of CMC Markets: “Currency markets certainly liked the sound of the speech with the pound rallying hard in the aftermath reversing all its declines from Sunday night as concerns about an uncontrolled Brexit diminish.

“In reality the seeds of today’s sterling rally were sown late last night when the outline of the speech made its way into the mainstream.”

“She’s gone for the full works. People will know when she said ‘Brexit means Brexit’, she really meant it,” a government source said.

Jeremy Corbyn stated on Twitter: “@Theresa_May has made clear that she is determined to use Brexit to turn Britain into a bargain basement tax haven on the shores of Europe.”

Unilever CEO, Paul Polman: “What we need to do is make sure that we don’t shoot ourselves in the foot and we have a solution that is good for the UK, good for Europe and ultimately good for the long term.

“My opinion unfortunately was different but that doesn’t mean that we are not 100 percent focused now on trying to reduce the damage as much as possible.”

IRISH GOVERNMENT STATEMENT: “She made clear that her priorities include maintaining the common travel area and avoiding a return to a hard border with Northern Ireland, both of which are welcome…

“The Government notes that the British approach is now firmly that of a country which will have left the EU but which seeks to negotiate a new, close relationship with it. While this will inevitably be seen by many as a ‘hard exit’, the analysis across Government has covered all possible models for the future UK relationship with the EU.

“The Government is under no illusion about the nature and scale of the Brexit challenge. The Government is acutely aware of the potential risks and challenges for the Irish economy and will remain fully engaged on this aspect as the negotiations proceed.

“The Government is also very aware of the potential economic opportunities that may arise for Ireland, including in terms of mobile investment. Economic opportunities for Ireland will be pursued vigorously.”

What will happen next for Brexit?

Theresa May has announced that the Government intends on officially notifying the European Council of the UK’s departure from the EU by the end of March 2017.

This will then trigger Article 50 and a two year negotiation period. During this time The European Council will draw up a negotiating guideline without the UK’s participation. After this, a withdrawal agreement will then be negotiated and agreed by the EU council.

single market departure announced in brexit speechDuring discussions, the UK will be free to continue functioning using existing agreements, however will not have a say or vote in any Council or European Council discussion concerning its withdrawal.

It is not certain what will be outlined in the withdrawal agreement, but it is likely to display detailed withdrawal arrangements and transition provisions, taking into account withdrawing our future relationship with the EU.

Withdrawal from the EU will take effect when the withdrawal agreement is applied, or two years after notifying the European Council of the intention to withdraw. If no withdrawal agreement is reached after this period, an extension isn’t agreed, or the UK doesn’t like the agreement, we can leave the EU without a withdrawal agreement.

The other EU Member States can also reject a withdrawal agreement. However, they are unable to stop the UK from leaving the EU. Upon departure, EU law will cease to apply to the UK, but there might be some acquired rights for EU and UK citizens.

Read more details on triggering Article 50

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