Varadkar Dangles Trade Carrot as U.K. Weighs Softer Brexit

(Bloomberg) --

The U.K. shouldn’t be a “silent partner” in any future customs union with the European Union, Irish Prime Minister Leo Varadkar said, holding out a carrot for Britain to pivot toward a softer Brexit.

The EU should be “generous” in any talks on a customs union, Varadkar told reporters in Brussels on Wednesday, adding Britain could be granted a say in the bloc’s future trade policy if it entered such an an arrangement.

But Varadkar’s offer was double edged. He was effectively backing the policy of Theresa May’s arch political rival, the U.K. opposition leader Jeremy Corbyn, who wants a customs union with the EU that allows a say for Britain over trade policy. Corbyn swiftly moved to present Varadkar’s intervention as evidence his plan could work.

May’s government is in talks with Corbyn’s team in a bid to win Labour support for her Brexit deal. She has so far resisted negotiating a customs union with the bloc, as it would curb the U.K.’s ability to forge new global trade deals. By making it so clear that he wants such an arrangement, Varadkar will add to the pressure on May at home to soften her stance.

Still, it’s not clear how much support Varadkar’s olive branch will draw from other members, according to an EU official, who asked not to be named as discussions are ongoing. While some nations may be in favor, any such proposal could well be resisted by other nations, the person said.

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