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Boris Johnson elected Prime Minister: is the UK headed towards a no-deal Brexit? | bestbrokers.co.uk

Boris Johnson elected Prime Minister: is the UK headed towards a no-deal Brexit?

Winning 92,153 votes to Jeremy Hunt’s 46,656, frontrunner Boris Johnson was elected new Conservative leader and UK prime minister on Tuesday 23 July.


This is a companion discussion topic for the original entry at https://www.bestbrokers.co.uk/blog/2019/07/25/boris-johnson-elected-prime-minister-is-the-uk-headed-towards-a-no-deal-brexit/

Certainly the next 90 days or so are going to prove interesting in political terms if Prime Minister Johnson (BJ) is to succeed in carrying out his pledge to achieve a withdrawal of the United Kingdom from the European Union by 31st October 2019.

BJ has what many would count as insurmountable hurdles to pass if he is to succeed and hold well on his promise. Not only does he lack a majority but there is also a lack of money to implement any changes and, of course, huge resistance to renegotiation on Brexit in Brussels. Significantly, as the summer recess is now underway, from 25th July, with the Lower House not returning and resuming session until 3rd September he will have ‘lost’ a third of his countdown already.

As an aside, for anyone who watches The House of Commons live channel, you will have noted that the ‘entertainment’ value of parliamentary exchanges has risen considerably since his taking over from Theresa May.

At the centre of debate is of course the Brexit withdrawal agreement – in referring to which many overlook the fact that in reality it is still a draft document, a proposal between the United Kingdom and the European Union on how Brexit might be implemented – it won’t actually become ‘an agreement’ until it has been agreed and ratified by parliament, which as we know has not been going to well since it was first published back in November 2018. This draft withdrawal agreement has been rejected three times by the House of Commons so far.

One of the key friction points within the draft agreement is of course that regarding the ‘back stop’. This, despite sounding like a cricketing term, could be viewed as a sort of insurance policy. It was included in the hope that it would ensure that there isn’t a return to the pre-1998 Good Friday peace agreement border controls on the land border between Ireland and Northern Ireland

Not unexpectedly Leo Varadkar, the Irish Prime Minister or Taoiseach, has had much to say about this of late and added the question mark over a possible unification of the South and the North should Britain leave the EU on a no deal basis at the end of October. In tandem with this Varadkar has warned of other social unrest impacts should Britain make a hard exit on 31st October.

Again, not unexpectedly, the EU is insisting that there must be a backstop in place as part of any Brexit deal. On the opposite side of the table, for BJ and his camp, this is a definite no-no. In fact it is one of the main bargaining chips being used by BJ who currently insists that unless the EU drop the Irish backstop from discussions then he will leave without a deal.

The unpalatable consequence of a backstop inclusion would mean that the EU and the UK would remain in a continuing relationship over this for an unspecified period with a very real possibility that the UK could be permanently ensnared in the EU customs union. This would effectively prevent the UK government from making trade deals of its own with other countries.

What of the rest of the EU negotiators and member states? It is clear that Michel Barnier, Jean Claude Juncker, Donald Tusk, Angela Merkel and Emmanuel Macron are all at polar opposite positions to BJ over Brexit. They have repeatedly described the new British Prime Minister’s stance as combative, with many seeing the strength of the remaining 27 countries in remaining a solid uniform unit at the Brexit table to ensure that any Brussels intransigence cannot be blamed for any subsequent economic downturn within the EU.

Even closer to home we have recently learnt that the former Tory chancellor, Philip Hammond, has been having private talks with Keir Starmer, the UK opposition party’s Brexit spokesman, in a move to stop BJ’s no-deal Brexit ambitions.

On a slightly more positive note, we know that US President Donald Trump and the Canadian Prime Minister Justin Trudeau have expressed interest in opening up new trade agreements with the UK after Brexit.

So is the UK headed for a no deal Brexit was the question – the answer is ‘possibly’ but, given all the above and what has happened (or not happened) since the Brexit referendum way back on 23rd June 2016, you can be sure that there will be many more false dawns – on a daily basis - before the final sun rises on 1st November 2019.

Well if you believe the rhetoric emanating from the most recent meetings between Dominic Raab, UK Foreigh Secretary, and Mike Pompeo, the US Secretary of State, there certainly seems to be strong reinforcement to previous rumours of new trade agreements with our old allies across the Atlantic Ocean as Pompeo has been quoted as stating that “…the US will be on the doorstep, pen in hand ready to sign a new trade deal with the UK as soon as possible after Brexit…”.

There are also hints of leverage being brought to bear as the United States, in the same talks, have also stressed that Huawei, the Chinese telecoms giant company, should not be allowed to provide their equipment in the new build of Britain’s 5G network.

On this latter matter is has not just been the US to raise concerns, as another Five Eyes member, Australia have blackballed Huawei, also raised concerns over the development of some the UK’s most sensitive critical infrastructure being contracted out to the hands of a company from the People’s Republic of China (PRC) .

Of the other two Five Eyes members, Canada has yet to rule on whether to allow Huawei equipment to form part of its 5G network whilst New Zealand has not banned Huawei, but blocked an attempt by one of the country’s major telecoms carriers, Spark, to include Huawei kit in its 5G rollout.

So as prime corollaries of the UK’s decision on whether to use Huawei, or not to use Huawei, are the signings of post-Brexit trade agreements - which direction will BJ favour? To the West or to the East? I know which one my money’s on.