Brexit Bulletin: Not Good Enough

Brexit is 17 days away.

(Bloomberg) --

Today in Brexit: British negotiators are running out of time to convince the European Union that they have a viable Brexit plan.

What’s happening? After an about-turn at the end of last week, Boris Johnson’s chances of sealing a Brexit deal with the European Union are hanging in the balance once again. The next 48 hours will be crucial, Bloomberg’s Ian Wishart reports, with the bloc wanting a resolution by Wednesday at the latest.

Despite intensive negotiations over the weekend, the EU’s chief Brexit negotiator, Michel Barnier, warned a meeting of EU envoys on Sunday that U.K. proposals are not yet good enough to be the basis for an agreement. Disagreement still remains about how to break the deadlock over the Irish border, where the issue of customs remains a problem. A spokesman for Johnson said “significant work” was still needed.

It leaves the U.K. in a race against time to reach a deal for EU leaders to sign at a summit that starts on Thursday. Johnson wants an agreement that he can put to a vote in a special session of Parliament in London on Saturday. (Even though that’s no cakewalk either: Bloomberg’s Rob Hutton surveyed the Westminster battle lines over the weekend.) If there’s no agreement, a recent U.K. law requires the prime minister to ask for an extension to the current Oct. 31 Brexit deadline.

Almost six months after the EU handed the U.K. a Brexit extension and warned “don’t waste this time,” the long-anticipated October crunch is now upon us. Former Theresa May aide Nick Timothy forsees “cries of anger, howls of anguish and claims of betrayal” — from Remainers. 

Whatever happens in the next 17 days, British and European politics will look quite different on the other side.

Today’s Must-Reads

• We’re heading into a frenzied fortnight in the run-up to Oct 31. Tim Ross explains how the next two weeks could unfold.
• Many world-famous British brand names are failing or struggling badly. They won’t be helped by Brexit, Katie Linsell and Thomas Buckley write for Bloomberg Businessweek.
• Johnson’s Tories could be on the cusp of a small majority in any upcoming election, academic and polling expert John Curtice writes in The Times.

Brexit in Brief

What Happened at the Weekend? | Observer readers had barely digested the newspaper’s report of increased talk of a new Brexit referendum when Labour leader Jeremy Corbyn told Sky News he still believes a general election should come first. (Though Shadow Business Secretary Rebecca Long-Bailey contradicted her leader on the BBC moments later.)

Anything Else? | Leader of the House of Commons Jacob Rees-Mogg warmed Telegraph readers up for Brexit concessions, while former Chancellor Philip Hammond denied a Mail on Sunday report that he is heading a “plot” to delay the divorce. Over the water, RTE’s Europe Editor Tony Connelly took a deep-dive into last week’s events — and what they mean.

Johnson v May | Boris Johnson’s Brexit proposals would leave the British economy worse off than the deal agreed to by his predecessor Theresa May, according to a new report by academic think tank The UK in a Changing Europe.

“Beyond Eye-Watering” | Separately, the Confederation of British Industry has a report out today on Labour’s plans to nationalize key companies and services. The projected cost? Almost $250 billion (£200 billion.)

Energy Concerns | Questions remain over the viability of Ireland’s 12-year-old single electricity market (SEM) in the years after Brexit, Olivia Konotey-Ahulu and Jeremy Hodges report. Problems could mount further down the line because of the market’s large reliance on supplies from power plants in the rest of the U.K.

Prayer Services | U.K. services companies face a slew of new rules after Brexit and could find themselves in breach of the law if they are unprepared, Jill Ward and Bryce Baschuk report.

State Opening | A new parliamentary session opens on Monday with the traditional Queen’s Speech. Legislative plans due to be announced include a Brexit Withdrawal Bill as well as healthcare investment, measures to tackle violent crime and increase wages for the lowest paid. Chancellor of the Exchequer Sajid Javid is due to deliver his annual budget on Nov. 6.

On the Markets | The pound slid from near a three-month high on news from Brussels, dropping as much as 0.6% against the dollar. Sterling traded at $1.2597 as of 7:08 a.m. in London after climbing to $1.2707 on Friday.

Want to keep up with Brexit?

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To contact the editor responsible for this story: Chris Kay at ckay5@bloomberg.net, Leila Taha

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