Setting out vision for future ties, May presses Brexit plans
Setting out vision for future ties, May presses Brexit plans
13 July, 2018, 01:45
In a long-awaited white paper policy document, her governmentsaid its negotiating position had "evolved" but that it was sticking to its principles for Brexit, the biggest shift in Britain's foreign and trading policy in decades.
A man takes a photograph of the Canary Wharf financial district from Greenwich Park in London, Britain, January 22, 2017.
As he headed to Britain for his first official trip, the USA president said that "I don't know that this is what [people] voted for" in the Brexit referendum in 2016.
Sir Keir Starmer, the shadow Brexit Secretary, said the "utter shambles" over the production of the White Paper was "clear evidence of why the government is in such a mess" over Brexit.
But the government has abandoned a plan for close ties with the European Union for financial services, instead saying it would push to improve the EU's current legal mechanism for access to the bloc's financial markets known as "equivalence" - when the European Union deems a country's rules to be as robust as its standards.
Britain is now part of the EU's single market - which allows for the frictionless flow of goods and services among the 28 member states - and its tariff-free customs union for goods.
May's approach was criticized by Davide Serra, a fund manager who says it still means London's financial sector could shrink as much as 20% over five years.
The plan also seeks to keep Britain in major EU agencies, including the European Aviation Safety Agency, the European Medicines Agency and the police agency Europol.
But EU officials have opposed the idea, saying it would take away the EU's autonomy in rulemaking.
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McGuinness' thoughts were backed up by Miles Celic, the head of The City UK, which represents the whole of the UK financial services industry. Until now, May has been holding out for an agreement based on "mutual recognition" of each other's financial regulations, which would involve little or no disruption to the status quo.
Not only must the White Paper paper win the backing of parliament, where its Tory critics lie in wait to ambush it; it falls well short of meeting the demands of the EU's 27 other governments that May make further politically painful concessions in order to satisfy them and the European Parliament, which must ratify any deal.
"We have to walk the tight rope between welcoming the act of the United Kingdom making an offer while also making it clear that this offer will not do and will need a lot of work from the British government", one said.
"But nobody said this was going to be easy".
Effectively staying in the single market for goods, but not services, is unlikely to be an attractive proposition for the EU.
The Treasury said: "This proposal is the best option for getting a good deal for the City".
"This looks like the UK's attempt to become the tail that wags the dog", Johnston said. Like financial services, TV broadcast to the European Union from London requires a licence in an European Union country to continue after Brexit.
Reuters reported last month that the bloc was opposed to changing equivalence exclusively for Britain, and that any improvements to its so-called equivalence regime would apply to other countries too.
In a major policy shift, Britain has abandoned a plan for close ties with the European Union for financial services, instead saying it would push to improve the EU's legal mechanism for access to countries outside the bloc known as "equivalence", where access is patchy and can be revoked at short notice.
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