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3 February 2020

Why the big row in the next stage of Brexit talks will be over geography

The differing views of the European Commission and the British government on distance are at the heart of division over the level-playing field.

By Stephen Bush

The UK’s Brexit debate is fundamentally over whether or not geography matters. The victorious faction currently believes that it doesn’t; thinking that you can make up for the erection of barriers to trade with your nearest neighbours by increasing trade with faraway countries at a greater or equivalent rate.

Both the defeated faction – which includes not only committed Remainers but also many longtime Brexiteers who privately think there is no point in leaving the customs union – and the EU alike believe that geography does matter: that trade between the UK and the EU will always outweigh that between the UK and nations further afield.

This disagreement is at the heart of the big policy argument that the UK and EU will have in the next phase of the Brexit talks. Everyone agrees that trade negotiations are about sacrificing regulatory autonomy for increased trade; the debate is about how much of one you are willing to forgo to gain the other.

The British government thinks that because geography doesn’t matter it should be able to enjoy the same trade arrangement with the EU as Canada, which has a measure of regulatory alignment but a greater level of market access than that proposed by the European Commission for the UK.

The European Commission believes that, because geography does matter, negotiating a trade deal that gives the UK the same terms as Canada would be lunacy. There’s a far greater threat to the European Union’s own economic prosperity if a neighbouring mid-sized economy can depart from EU regulations on workers’ rights and state aid than there is if a mid-sized economy more than 4,000 miles away does so.

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It will be the distance between those two positions – and how much economic activity the Conservatives are willing to forego in order to maximise sovereignty – that defines the next year of talks.

This is what is missing when commentators say, “Hur de hur, Leavers think that the government is right while Remainers think that the EU is.” The case for the type of Brexit being pursued by Boris Johnson lives or dies on whether you think the British government is right to believe that distance doesn’t matter, or if the European Commission is right to think that it does.