Brexit Bulletin: The Dilemma of a Deal

Brexit is 44 days away.

(Bloomberg) --

Today in Brexit: After a chaotic day in Luxembourg, the pressure rises on Boris Johnson to find a Brexit deal.

What’s Happening? Boris Johnson's talks with European Commission President Jean-Claude Juncker and Luxembourg's Prime Minister Xavier Bettel didn’t quite go as planned, ending with Britain's prime minister being lambasted for the current impasse and Juncker saying the U.K. still needs to make concrete proposals for a new Brexit deal. 

That's put the onus back on Johnson,  who still needs to find a solution to the Irish border question that’s hamstrung the British so far. An idea he’s mooted as a partial solution is an all-Irish food zone, aiming to avoid the need for checks along the frontier between Ireland, which is in the EU, and Northern Ireland, which is in the U.K.  

Yet selling this would be fraught with difficulty. As Bloomberg's Dara Doyle explains, whatever plan Johnson eventually comes up with could be vetoed by Northern Ireland's power-sharing assembly, where only a third of members are needed to block a proposal.  For example, the Democratic Unionist Party may object to London drawing an effective customs border in the Irish Sea, separating all of Ireland from the U.K. because its priority is maintaining the union with Britain. However, this effective veto could be unacceptable to the EU and Ireland. 

That's not the only trouble. Irish Prime Minister Leo Varadkar points out food only covers about 30% of all cross-border trade, meaning there'd still need to be checks for other goods. Plus there’s the small matter of Johnson getting the accord through Parliament, where the DUP could stand firm against the proposal, leaving the Tory party leader needing a large number of opposition Labour votes. Johnson’s so-called “landing zone” for a Brexit deal is still looking precariously small.

Today’s Must-Reads

• Brexit is sapping Britain’s political energy, including its ability to fix the infamous and botched centerpiece of its welfare state, David Goodman writes for Bloomberg Businessweek.
• In case you missed it, read Bloomberg’s analysis of the U.K. Supreme Court case starting today on Johnson’s shutdown of Parliament.
• Businesses in Northern Ireland see merit in a tweaked Brexit deal, the Financial Times reports.
• The BBC’s Laura Kuenssberg pressed Johnson on what his proposals might be after his meeting with Juncker.

Brexit in Brief

Attacking the “Nightmare” | In a remarkable diplomatic moment Monday, Luxembourg's Xavier Bettel pressed on with a press conference next to an empty podium after Johnson skipped the event for fear of being drowned out by noisy anti-Brexit protestors.

The Judges Who’ll Decide | The Supreme Court judges hearing Johnson's prorogation case include a T.S. Eliot fan and one controversially named an “Enemy of the People” by the right-wing Daily Mail newspaper.

“Lives at Risk” | Britons risk dying because of a no-deal Brexit, Liberal Democrat Party leader Jo Swinson will say in her first party conference speech today. Deliveries of time-sensitive pharmaceuticals could be at risk due to border disruption, she will warn.

Equities Damage | The U.K.’s top market watchdog said equity markets face significant damage in a no-deal Brexit unless the EU reverses a plan to block traders in its home territory from using London exchanges.

Want to keep up with Brexit?

You can follow us @Brexit on Twitter and join our Facebook group, Brexit Decoded. For all the latest news, visit bloomberg.com/brexit. Got feedback? Send us an email.

To contact the editor responsible for this story: Neil Callanan at ncallanan@bloomberg.net, Leila Taha

©2019 Bloomberg L.P.