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2/12/17

Britain's slow and agonizing meltdown: The EU’s Brexit negotiators prepare for disaster - Charlemagne

“BREXIT is so fascinating!” exclaims a French official. Few Europeans wanted Britain to quit the European Union. But now that it is happening, foreign ministries and policy units across the EU are relishing the task ahead. As an intellectual exercise, managing the multifaceted complexities of Britain’s departure from the EU offers the kind of satisfaction rarely found in policy work. As a historic negotiation without precedent—no country has left the EU before, let alone one of Britain’s size and stature—it is a wonderful CV-builder. In Brussels, where the talks will take place, officials are scrambling to involve themselves with what one calls “the sexiest file in town”.

The preparations for Brexit on either side of the English Channel offer a Homeric parable of chaos and order. In Britain Theresa May, the prime minister, exudes swanlike calm, restricting her utterances on Brexit to warm banalities. But below the surface her government is paddling furiously to avoid being submerged by the awesome bureaucratic task bequeathed to it by Britain’s voters. One leaked note from a consultancy portrays a flailing government that needs up to 30,000 more civil servants to manage Brexit. Mrs May says she will notify the EU of Britain’s intention to leave under Article 50 of the EU treaty by the end of March 2017. That leaves barely three months to settle basic questions such as whether Britain should aim to stay in the EU’s customs union.

The contrast with the EU’s institutions, and the larger capitals, is striking. The 27 remaining EU countries quickly established a common line towards Britain on matters like the indivisibility of the EU’s single market. At a summit on December 15th, as The Economist went to press, they were due to issue a formal declaration outlining the format for the talks to come. The Brussels institutions have largely established their respective roles, bar a wobble from the European Parliament, and now spend their days in quasi-academic contemplation of trade models or security co-operation protocols as they wait for the games to begin. Officials everywhere insist that their priority will be preserving the interests of the EU, not keeping Britain happy. “This is a negotiation where we have to defend Europe, not undo it,” says Guy Verhofstadt, the European Parliament’s Brexit point-man.

European officials have refused to engage with Britain until Mrs May triggers Article 50. But they observe goggle-eyed the spectacle unfolding across the Channel. Some British ministers appear to believe that the entire relationship can be recast, rather than merely the divorce settlement finalised, in the two-year period Article 50 allows. European negotiators who think it is essential to act as one are staggered to hear some ministers cling to the delusion that Germany’s need to sell cars to British motorists will ensure that Mrs May secures a good deal.

Gloom is thus descending on the European side. The EU will probably insist on settling the terms of Britain’s withdrawal before discussing future arrangements, and each is ripe for the fiercest of rows. Top of the list is the departure bill that the European Commission, which will lead the talks on behalf of the EU, will place before Britain. The commission puts the sum at up to €60bn ($64bn), roughly equivalent to three-quarters of Britain’s projected budget deficit for 2016-17. Brexiteer diehards, and their allies in the pit-bull press, will transfer their fury from the domestic “Remoaners” they accuse of holding up Brexit to perfidious Europeans making outrageous demands. One EU official puts the chances of Britain walking out of the talks next year at 50%.

Even if catastrophe can be averted, the negotiations will offer endless opportunities for rancour. Take the question of what to do with the 2.8m EU citizens living in Britain and the 1.2m Britons in the rest of the EU. At first blush it seems simple: both sides agree to guarantee the ongoing rights of citizens who arrived before a given date—perhaps the notification of Article 50. Indeed, Mrs May has sought to strike such a deal before beginning the formal withdrawal talks (concerned that she was seeking to play divide-and-rule, her European counterparts rebuffed her).

But closer inspection reveals a never-ending string of complexities. Do governments have the administrative wherewithal to process applications for permanent residence? Will the children of EU citizens have the right to cheap university tuition? What about accrued pensions or other benefits? None of these questions is intractable. But each requires detailed negotiations and technical work. The same goes for other matters to be tackled in the withdrawal talks, from the pensions of British Eurocrats to the management of safety at Britain’s nuclear plants. Untangling a 43-year-old relationship, it turns out, is devilishly complicated.

Triumph of the won’t?

This in turn explains why concluding a separation deal within two years will not be easy. (In fact the months needed for procedural matters and ratification will cut the negotiation time to around 15 months.) The scale of the task, and the economic thump many Europeans think is heading Britain’s way—inflation, diverted investment and swooning public finances—mean some still harbour a hope Brexit may be averted. But that misreads the British mood. If things turn sour the blame will be heaped not on Brexit, but on the obstructionist EU.

The ingredients for Brexit—a departing country confused about its leverage, a club distracted by other problems and determined to avoid more fractures, a procedure without precedent, a tight deadline—make a combustible mix. Yet both sides should feel the historic weight of these talks. Although Britain will be the first victim if things go wrong, a club assailed by crisis on all sides knows it cannot afford to oversee a Brexit debacle, however fascinating the exercise. For the EU, at least, that means placing hope in a British government that it fears may not warrant it. “From a rational point of view, we can’t fail,” says an official in Brussels. “But I’m not sure the rationality is there in the UK.”

Read more: Charlemagne: The EU’s Brexit negotiators prepare for disaster | The Economist

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