POLITICAL & COMMERCIAL INTELLIGENCE

We help companies affected by political change. To access our political and commercial intelligence service, email GUIDE’s Chief Executive on greig@theguideconsultancy.com


17APR19: THERE IS NO STATUS QUO

Emissions policy is a practical example of how, in Brexit, there is no standstill option. A ‘clean break’ opens the door to dramatic political reform, while revoking Article 50 and staying in the EU means working with the Commission’s new ambitions for the future. Even the current extension of talks creates new market forces and challenges: UK heavy industry now faces a difficult balancing act when it comes to the Emissions Trading Scheme (ETS) as it is still subject to the EU regulations that set terms but does not have full access to permits, because the EU27 want to avoid a flood of UK-issued allowances entering the market if Brexit happens. Whatever we see between now and October – in politics as in business – there is no option to keep things the same as before.

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12APR19: EXTENSION ANALYSIS

Extending Article 50 does not just mean a change of dates. There are three more substantive effects. First, HMG has committed to “facilitate the achievement of the Union’s tasks […] in particular when participating in the decision-making processes” -  so it promises not to hinder EU27 budget, appointment, or policy decisions. Second (and in case the UK reneges on the first point), the agreement allows the EU27 to make any decision without the UK if it so wishes. And third, in a bid to navigate the election of a new European Parliament, the EU27 will decide when the Withdrawal Agreement comes into force even if HMG can get its own legislation through Westminster.

04APR19: EU COMMISSION ON NO DEAL PT.2

Today, EU Commission Vice-President Jyrki Katainen confirms disruption of health safety measures will be limited in the event of no-deal. Katainen says “we remain in intense contact with the UK and EU27 to ensure that all certificates for the medical devices issued in the UK, are transferred to the EU27 before the withdrawal date […] But, if problems were to arise, Member States have the possibility to use the derogation provided in existing legislation which would authorise the temporary placing on the market of medical devices that have not been certified by an EU body”. In other words, Member States can ignore EU rules in the short term and continue to trade with the UK as before.

03APR19: EU COMMISSION ON NO DEAL

Discussing the prospect of a no-deal Brexit today, EU Commissioner Moscovici says “Our common goal is to protect European consumers and the integrity of our internal market without disrupting the activity of European companies that regularly trade with the United Kingdom. Of course, enforcing customs legislation, does not mean controlling all shipments or trucks systematically. It would be absurd for us to be tougher or stricter with a country that comes out of the European Union.”

25MAR19: SPENDING REVIEW 2019

Chief Secretary to the Treasury, Liz Truss, says this year’s Spending Review will include a “zero-based” approach to all major infrastructure projects so focus can be given to “local transport around our cities and counties”. In other words, HMG will take a no-holds-barred fresh look at other spending that had already been committed. Taken together with Brexit and internal Conservative politics, this could spell trouble for controversial projects like HS2.

21MAR19: THE NEXT EU COMMISSION

Candidates for what is arguably the EU’s top job (President of the Commission) are jostling for position. Even with one foot out the door, the UK should pay attention. Politicians govern in prose but they campaign in poetry. Before November and during the next stage of UK-EU negotiations, potential Presidents will set out their wares with sometimes real-world effect. The tech industry, for example, now has 1.5bn new reasons to get to grips with Margrethe Vestager’s manifesto after the would-be successor to Juncker fined Google. UK negotiators must understand their opponents’ motives from April.

30JAN19: EU AND THE IRISH BORDER

EU ambassadors have passed – unamended – measures to continue the PEACE IV and INTERREG VA programmes on the Northern Irish border, regardless of whether there is a no-deal Brexit. The EU will fund both programmes until at least 2020.

29JAN19: CONSERVATIVES SET HARD DEADLINE OF EU ELECTIONS

The Conservative Party’s National Convention will be asked to support a resolution that Brexit will not be delayed “beyond the European elections”. HMG is keeping the option of a shorter delay, in the expectation it would be needed to get required legislation through Parliament.

17JAN19: EVERYTHING CHANGES, EVERYTHING STAYS THE SAME

If a General Election is held before Brexit, political dynamics could change dramatically even if the parties win roughly the same number of seats. Local Labour and Conservative associations could move to deselect incumbent MPs who are not seen to reflect activists’ views on Brexit – and the Speaker would need to be reselected and elected, too.

08JAN19: BIGGEST BREXIT BUST UP STILL TO COME

Consider this for a perspective on the EU economy: Italy, Spain and France are among the member states in breach of EU rules on budget deficits and national debts; the soon-to-end QE of the ECB printed cash equivalent to 25% of Eurozone GDP; and French banks have exposure to Italian debt that is equal to 11% of French GDP. If there is a significant downturn – or bailout – on the other side of the Channel, the biggest political question in the UK could quickly become “are we protected?”.


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