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Why is the British Prime Minister conducting Brexit negotiations as if he wants to slam them against the wall? Insiders assume that Johnson has a smart plan: He is waiting for Trump, the winner of the US election, to close a deal with him. Then he wants a hard Brexit with the EU. But Johnson disagrees.
British Prime Minister Boris Johnson has denied claims that he would delay negotiations on a Brexit trade pact with the EU until the US elections. President Donald Trump is considered a Brexiter, while his Democratic challenger Joe Biden is more attached to the European Union. On speculation that he would only announce a possible no-deal Brexit if Trump were to be president again, Johnson said: “They are two very different things.” He is happy that both parties are back at the same table in the Brexit negotiations.
“We will see what the talks bring,” the prime minister told reporters during a visit to the Royal Berkshire Hospital in Reading, west London. His comments mainly related to an Observer report over the weekend, according to which Johnson allegedly wanted to await the outcome of the November 3 US presidential election. If Trump wins the election, Johnson would immediately conclude a trade deal between the United States and Britain.
According to a British government spokesman, London and Brussels are now “in an intensive phase of negotiations” on a Brexit trade pact. The talks had made little progress so far, with London even leaving the negotiating table in the meantime. If no agreement is reached, tariffs and other trade barriers threaten. The transitional phase of Brexit, in which almost everything has remained the same, will come to an end in about two months.
Hard Brexit: study predicts tough times for Brits
Fall in exports, inflation, wave of bankruptcies: according to one study, a hard Brexit without a trade deal with the European Union would have many negative consequences for Britain. This put up to 15 percent of British exports to the EU at risk, threatening losses of almost 14 billion euros, according to the study by credit insurer Euler Hermes. “A difficult exit in addition to the Covid 19 pandemic and the already difficult economic situation would hit Great Britain very hard,” said the head of macroeconomics of the Euler Hermes Group, Ana Boata.
In the event of a difficult exit, expect another recession in Britain next year, in which gross domestic product (GDP) should collapse by five percent. The inflation rate is likely to be above the five percent mark, mainly due to the sharp increase in import prices of 15 percent and a ten percent devaluation of the British pound against the euro. The British would have to put much more money on the table in the future, for example, on shoes, hats or umbrellas. Experts at Euler Hermes predict that the prices of these products will rise by around 20 percent. Textiles, food and beverages, alcohol, tobacco, and vinegar are also likely to cost significantly more.
