06.10.2022

Barnier rejected Britain’s plan for border with Ireland

The British proposal to resolve the customs problem with Ireland after Brexit “raises more questions than answers,” said EU negotiator Michel Barnier.

The day after British Prime Minister Theresa May announced that she could keep the entire United Kingdom in the EU customs zone for an additional year after Britain left the EU in March 2019, Barnier rejected the deadline proposal.

He also made it clear that he would not allow London to use the special EU market access offer for products from Northern Ireland to ensure similar conditions for all British goods.

“It’s nice to see the UK working with us to come up with such a proposal,” Barnier said at a news conference. But he later added: “I find that this raises more questions than answers.”

Both sides want to make a deal by October to avoid barriers on the border with Ireland, which could provoke a new conflict in the north.

According to Vesti.Ekonomika, it was previously reported that the United Kingdom could grant Northern Ireland joint status as a member of the UK and the European Union so that the country could freely trade with both, trying to break the deadlock in the Brexit negotiations.

The idea is to create a 16-kilometer trade buffer zone along the border for local merchants, such as dairy farmers, after Britain leaves the block, an agency source in diplomatic circles said.

This plan is one of several discussed, but it may not be offered to the European side, the official said.

The inspiration for the double regulation system was taken on the example of Liechtenstein, which can simultaneously work both in Switzerland and in the European economic zone.

UK wage growth slows unexpectedly

The British economy continued to create jobs at a healthy pace three months before the end of April, but at the same time, wage growth slowed unexpectedly, Bloomberg reports.

Employment reached a record level of 75.6% after the economy added 146 thousand jobs, which is more than the growth of 120 thousand, which was predicted by economists. The unemployment rate was 4.2%, the lowest since 1975.

However, an unexpected slowdown in wage growth may indicate that the economy retains unrealized potential. Salary growth, excluding bonuses, slowed to 2.8% between February and April, the National Statistical Office (ONS) reported.

For politicians in the Bank of England, the question is how quickly the economy uses its full potential. Rates for the August rise in interest rates fell on Monday after production and construction failed to recover in April, as previously forecast.

Business advocates maintaining EU rules in Britain

BusinessEurope, the European business federation, called on the British authorities to maintain as many EU rules as possible after Brexit, in order to narrow the gaps in trade and supply chains, Reuters reports.

Negotiators meet before the EU summit on June 28-29 to make progress on determining what kind of relationship should replace UK membership in the EU after the country’s withdrawal from the bloc in March next year and after the transition period with the status quo ends in 2020 .

“Equalization of regulation between the EU and the UK is of paramount importance to maintain value chains and avoid non-tariff barriers to trade. Regulatory cooperation is paramount, ”said the group, which includes CBI, in preparing a new report.

Calling for an early agreement between the two parties to avoid uncertainty and the risk of disruption when the UK simply reverts to global trade rules, BusinessEurope also called for simplified customs procedures.

The group stated that small businesses with little experience in trading outside the EU single market need special assistance from the authorities to cope with the changes.

“No agreement on free trade today has come close to resolving issues of regulatory divergence, and this will be a problem for both sides,” the group said.

The talks are aimed at preparing a broad plan at the end of this year, as well as a detailed agreement on how the country’s exit from the EU will work.

As British Prime Minister Teresa May argues with her ministers about how far the country can go from EU customs and standards, EU negotiators urge London to clarify what the authorities consider the preferred way forward.

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