A bimonthly magazine on international affairs, edited in Germany's capital

What Germany Needs to Do Next … On Brexit


A desperate Theresa May will turn to you for help. You will need to call her bluff.

Cover Artwork: © Mitch Blunt

Dear Dr Merkel,

First, let me congratulate you on your re-election as German chancellor. It is a remarkable achievement in these days of democratic disintegration.

Theresa May will have sent a warm message from London. You must read between the lines, however: the British prime minister is in despair after her own disastrous election result in June.
How did she lose her majority by being repetitive and boring, while you won with the same tactics? Life is so unfair! Yet Theresa is desperate, and she thinks you are the one person in Europe who can help her. That is what I am writing to you about – I will call it Theresa’s Dilemma.

You know the problem very well: the Brexit vote in Britain is a self-inflicted disaster, like a national suicide. Leaving the European Union is going to be incredibly messy, time-consuming, and complicated. Unfortunately, it will also have damaging economic and political consequences for our EU partners, including Germany. You have a real interest in damage limitation. But is it possible?

The trouble with the Brexiteers is that they don’t agree on what they want. Some seek to retreat into a nationalist, protectionist fortress. Others are fanatical free traders who think they can prosper without international regulation. They all share a nostalgia for the days of the British Empire. I suspect that is what you meant when you said some of them were “living on another planet.”

They do not understand, or want to understand, how to negotiate agreements by consensus in Brussels, which is something you are very good at.

Your problem is that the British still want to “have their cake and eat it too,” as Boris Johnson, the court jester masquerading as foreign secretary, said in the Brexit campaign. They want to cherry pick the best bits. That has become quite clear in various policy papers published in recent weeks. They want to leave the EU customs union and the single market, and yet retain the benefits they like – such as a special deal for the City of London, and an absence of visible customs checks between Northern Ireland and the Irish Republic. They won’t say how it can be done.

The only detectable shift is that they now want some sort of “soft” transition period before they leave the club, although the final target is still vague.

It seems to me there are three possible outcomes: a “hard” Brexit, which would see the UK exiting the single market and customs union and negotiating a new trade deal as a third country; a “soft Brexit,” which would allow them to keep some of the benefits in exchange for willingness to abide by EU rules – a sort of “Norway-plus” relationship; or no deal at all, if negotiations break down.

A “soft” Brexit might be ideal if the UK were trying to join the EU, but it sounds awfully like the “cherry-picking” that you have consistently ruled out for a country trying to leave. The only workable “soft” deal is for the UK to stay a full member of the EU. I think you should make that absolutely clear to Mrs. May.

But there is a very real danger of no deal, because the two-year time-scale for agreement is absurdly tight. There is going to be an unholy row about UK budget contributions, because it is a zero sum game. So the Brits are refusing to engage on the question, and the EU-27 refuse to retreat.

The clock started ticking on March 29, when Mrs. May sent her letter invoking Article 50 to Donald Tusk. Five months have elapsed with no progress. It is a fantasy to believe that agreement on the entire future relationship can be reached in time for parliamentary ratification by March 29, 2019. It looks extremely unlikely that we can even agree on the exit arrangements in time.

One of Mrs May’s most foolish statements was that “no deal is better than a bad deal.” That is arrant nonsense. Yet it may be the only way in which the British can be persuaded to come to their senses.

So I fear the choice is yours, Madam Chancellor: either convince all 27 remaining EU countries to stop the clock, or let the talks collapse without a deal. I would call Mrs. May’s bluff: if she will not negotiate in good faith, then “no deal” is the inevitable outcome.