Tomorrow, tomorrow and …

The 'flextension' could be a good bet for Brexit

As things stand, the United Kingdom could leave the European Union (EU) on April 12, almost certainly without a deal, or on May 22 or June 30 with or with without a deal, or on March 29, 2020, with or without a deal. Alternatively, it could choose to remain in the union by revoking Article 50 of the EU’s Lisbon Treaty, the clause under which members can voluntarily leave. All options are on the table as confusion over Brexit intensifies, and businesses on both sides of the channel continue in a state of limbo. A frustrated EU 27 had refused a second extension of June 30 to the UK’s embattled Prime Minister, Theresa May, but are being asked to reconsider that date when it meets on April 10 for the next summit. Whether the EU leadership will agree to the June 30 deadline again is an open question, since French President Emmanuel Macron has demanded a clear reason for the extension. In the circumstances, the European Union Council President Donald Tusk’s proposal that the EU consider a “flextension” deadline of March 29, 2020, with an option to exit before that if Parliament passes the withdrawal agreement, appears to offer all parties a breather from the deadlock at Westminster and Brussels.

But as with all things Brexit, the June 30 deadline and the “flextension” both mean that the UK would be legally bound to participate in the elections for the EU Parliament. This prospect has enraged both the centrists in Ms May’s Conservative Party and in the opposition Labour Party, both fearing a resurgence of far right politicians who have had a deleterious impact on British politics. Given that Ms May is unlikely to deliver a deal by the June 30 deadline — assuming the EU Council accepts it — Mr Tusk’s “flextension” could, at the very least, help clarify the political situation in which an increasingly unpopular prime minister grimly hangs on to office (indeed, the pound rose against the dollar following Mr Tusk’s proposal). Having belatedly reached across the aisles to the opposition Labour Party to discuss mutually agreeable terms for a withdrawal agreement, she appears to have doubled down on the same deal that has been voted down three times in Parliament.

The alternative solution for the UK to leave without a deal has also been raised. In this situation, World Trade Organization (WTO) rules will apply, a solution that Brexiteers may consider a tenable one. A WTO regime, however, appears a poorer solution than the Backstop agreement, the principal sticking-point of Ms May’s deal. WTO rules imply that the UK would be treated like any third country — and without a trade agreement that would mean a return to tariffs on some items and border checks, including in Northern Ireland, which the Backstop, however open-ended and politically unacceptable, seeks to avoid. The disruption on businesses is incalculable. On current reckoning, there appear to be no good options for Brexit, underlining the dangers of relying on popular referendums in political decision-making in functioning democracies. The deadlock is taking its toll. The UK, once among Europe’s fastest-growing economies, has seen growth slow since 2015. The public spectacle of the political deadlock is narrowing its options as multiple deadlines elapse. In the short term, April 12 could be the UK’s D-Day.