Monday 25 June 2018

Britain must let go of 'unrealistic...utopian positions' in Brexit discussions - former European Commissioner

Philip Hammond is 'foolishly pushing for a free trade agreement for the financial sector post-Brexit'
Philip Hammond is 'foolishly pushing for a free trade agreement for the financial sector post-Brexit'

Conor McCrave

The British government must let go of "unrealistic" and "utopian positions" if it is to secure a free trade agreement with Europe post-Brexit, according to a former European commissioner for Economic and Financial Services.

Spanish politician Jaoquin Almunia said the cost of Brexit to the UK's financial sector must come at a "high price", at an event hosted by Irish Law firm Arthur Cox and Dublin City University.

He said members of the House of Commons, including Chancellor of the Exchequer Phillip Hammond, were foolishly pushing for a free trade agreement for the financial sector that would mirror the single market.

He said it was "not wise.... to stick to these utopian positions".

"With only six months ahead of us, or less than six months to conclude the negotiations, this is not wise to stick to these utopian positions that will never be accepted," Mr Alumnia said.

European Brexit negotiator Michel Barnier, has insisted the withdrawal agreement must be finalised by October in order to be ratified by March 29, 2019 when Britain formally leaves the EU.

Europe has rejected proposals from Britain which aim to secure access to the single market for financial services between the City of London and the EU27.

As a result, Dublin, Paris and Frankfurt are thought to be prime locations for companies who want to maintain the same access to financial markets in Europe.

Investment banks JP Morgan and Barclays have already moved to expand their Irish operations as a result.

Mr Almunia also said the British government had drawn red lines early on in negotiations and while these red lines have started to "fade", Britain must be the ones to pay the price for Brexit not the EU.

"Everybody is at risk of having losses but those who decided Brexit of course cannot be better off at the end," he said.

"To make this clear the British cannot be better off after Brexit, neither in financial services nor in many other areas."

He said the consequences of Brexit which include "fragmentation of financial markets, higher costs for financial services, loss of efficiencies and synergies, legal uncertainty" must come at a "high price" for the UK.

Meanwhile, on Tuesday, the EU’s office for statistics Eurostat announced it was moving toward new aggregates which exclude information from the United Kingdom as it prepares for the country's departure.

The office which manages and publishes stats for Europe in areas of GDP growth and population numbers said the move was in response to "users’ requests".

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