Britain and the European Union agreed on Monday to a transition period to avoid a “cliff edge” Brexit next year — though only after London accepted a potential solution for the border with the Irish Republic that may face stiff opposition at home.
The pound surged on the confirmation that Britain would remain as effectively a non-voting EU member for 21 months until the end of 2020. Some business leaders, however, echoed a warning from EU negotiator Michel Barnier that the deal will be legally binding only if London ratifies the whole withdrawal treaty by March 2019.
That means solving outstanding issues, notably how to avoid a “hard border” that could disrupt the peace in Northern Ireland. Britain says an EU-UK free trade deal to be sealed by 2021 can do that. But Dublin wants this year’s treaty to lock in a “backstop” or fallback arrangement in case that future agreement does not work.
Both sides are committed to keeping a free flow of people and goods over the intra-Irish border without returning to checkpoints, as during the three decades of violence in Northern Ireland. However, finding a practical solution for any customs checks needed post-Brexit has proved elusive so far.
The dispute with Ireland had threatened to derail May’s hopes of a formal political endorsement of the transition deal by EU leaders when they meet in Brussels on Friday. A weekend of intensive talks, however, has broken the deadlock — for now.
Prime Minister Theresa May, who relies on pro-British Northern Ireland members of parliament to pass her Brexit legislation, rejected a fallback proposed by Brussels three weeks ago. She said keeping Northern Ireland under EU trade rules would isolate the province from the mainland.
SOURCE: REUTERS
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