What to Watch Out For at the Brussels Brexit Summit

(Bloomberg) --

With just 163 days to go until Brexit day, markets and businesses are still seeking clarity. Wednesday’s European Union summit was supposed to be the moment a deal was agreed, but the Irish border impasse has put that on hold.

So what happens now? What can Theresa May achieve—and what must she avoid? The last time the British prime minister met the so-called EU27, in Salzburg, Austria, she returned home humiliated.

May told Parliament on Monday the U.K. and EU are not “far apart.” EU President Donald Tusk sees goodwill on either side, but adds that no-deal is closer than ever. The Irish problem is a “new version of the Gordian knot,” he said.

“I hope that tomorrow Prime Minister May will present something creative enough to solve this impasse,” Tusk said on Tuesday.

Meanwhile Teneo Intelligence, a research group, said the Brexit drama is “choreography designed for domestic consumption in the U.K.” 

So which is it to be? Deal or no-deal? Even if a solution proves elusive, the latest summit could prove critical. Here’s what to watch, and when.

All times CET.

The leaders arrive—and set the tone (6 p.m.)

Leaders will start to arrive at the Europa building, home of the European Council, the EU’s key political body. Watch out for statements from May, Donald Tusk, and other key players including French President Emmanuel Macron and German Chancellor Angela Merkel. 

Theresa May’s big moment (7 p.m.)

Before the leaders begin their formal working dinner, Theresa May will make her pitch. With talks stalled since Sunday, this is the PM’s chance to win her EU colleagues round. She needs them to convince them there’s a way to solve that Irish conundrum—how to ensure no hard border on the island of Ireland once the U.K. leaves the bloc. At Salzburg last month May’s dinnertime pitch went down very badly indeed. How will she play it this time around?

Once she’s finished, May leaves the room. She doesn’t get to eat the dinner.

What to Watch Out For at the Brussels Brexit Summit

Working dinner (from 7 p.m.)

With May out of the room, the leaders will eat and talk. They will decide what to do next—call a summit in November in a sign they believe there’s progress, or step up no-deal planning. Or possibly both.

Wednesday night

Before Sunday the talk was all about a night-long push to agree the terms of a deal. That’s not on the agenda anymore. But there could still be some haggling to be done. Watch for late-night news on the framing of the Irish backstop, or even a dramatic breakdown. 

Even without a special Brexit summit in November, there is one more scheduled European Council meeting this year, in December, to try and reach an agreement.

Thursday is another day (8:30 a.m.)

With Brexit out of the way the leaders move on to migration and internal security. They’ll meet the president of the European Parliament, hold a working session and eat lunch before starting a round of news conferences.

The leaders speak (3:30 p.m.)

Donald Tusk will hold a news conference, as will Theresa May and other leaders, which should shed some light on the events of the night before. 

Tusk is usually worth tuning into, armed as he often is with a pithy phrase or cultural reference for every occasion. In Salzburg May came out of a chastening one-to-one with Tusk and braved her way through a difficult news conference. She’ll hope for an easier day this time around, without President Macron causing ructions in another room.

And it doesn’t end there. Whatever happens in Brussels, May will attempt to keep her ship sailing through to a key domestic date just over a week later.

Budget day (October 29)

U.K Chancellor of the Exchequer Philip Hammond will publish the government’s budget at a time when there’s little political breathing room away from Brexit.

Hammond may need to be flexible, with the government still potentially trying to reach a Brexit deal. Any budget he proposes will need support from a majority of U.K. lawmakers, including members of Northern Ireland’s Democratic Unionist Party, who have threatened to vote it down if they are unhappy with the way Brexit talks go. Traditionally that’s a confidence issue for a British government.

November (Date TBC)

A special EU summit could be staged in November. Leaders and officials wanted this to be a largely ceremonial event to sign off any deal agreed this week. Instead it may turn into a gathering used for no-deal planning, or an almost-last-ditch effort to broker a deal.

Speaking on Tuesday, Irish Foreign Minister Simon Coveney said it’s “unlikely there will be a lot agreed tomorrow night,” and played down talk of a November summit. 

December 13-14

The final summit of the year comes just three months before Britain is set to leave the EU bloc and is seen by some governments as the last chance to reach a deal.

©2018 Bloomberg L.P.