Brexit negotiations are about to get underway, but new documents recently released show just how likely it is that the UK could end the two-year negotiations without a deal.
The prospect could put the UK’s national interests at risks, according to a parliamentary committee, and other reports paint a dire economic picture of what would happen to the region.
The announcement comes just days before May is expected to trigger Article 50 to formally end the UK’s membership in the EU.
Likelihood of No Deal
When asked how likely the threat of exiting without a deal, Crispin Blunt, the chairman of the committee, said “The possibility of ‘no deal’ is real enough to require the government to plan how to deal with it.
But there is no evidence to indicate that this is receiving the consideration it deserves or that serious contingency planning is under way. The government has repeatedly said that it will walk away from a ‘bad’ final deal. That makes preparing for ‘no deal’ all the more essential.”
The new report brings more attention to British Prime Minister Theresa May’s leadership during the negotiations, especially after her thought that “no deal would be better than a bad deal.” Multiple other parties disagree with her statement, saying that leaving without a deal is likely and would be the worst possible outcome.
According to the committee’s in-depth research, negotiations could break down and lead to an exit without a deal for several reasons, including a deal being killed at the last minute by the European parliament.
What Happens Without a Deal?
The main concern of leaving the EU without a deal comes down to trade. As it currently stands, negotiations are expected to negotiate between a hard and soft Brexit to allow Britain to maintain some of its current trading rights as a member of the EU.
Without a deal, the UK could have to trade on World Trade Organization rules, which could be detrimental for the economic health of all parties involved. Theresa May has stated her plans to rely on WTO tariffs in the case of a hard Brexit, but that choice has been predicted to cause a “major economic shock” on jobs, companies, and food prices, according to a leaked Treasury document.
“It is clear from our evidence that a complete breakdown in negotiations represents a very destructive outcome, leading to mutually assured damage to the EU and the UK,” Blunt said. “Both sides would suffer economic losses and harm to their international reputations.
Individuals and businesses in both the UK and EU could be subject to considerable uncertainty and legal confusion. It is a key national and European Union interest that such a situation is avoided.”
The committee also predicts that leaving without a deal would cause British citizens living in other European countries to lose their healthcare, jobs, and benefits, especially if they have lived in the country for less than five years.
While there has been discord between the political parties within the UK, nearly everyone seems to agree that leaving without a deal would be the worse-case scenario.
The Labour Party, which has opposed Brexit, says it is worried about what a no-deal situation would do for British jobs and businesses. It says its job is now to guarantee that a deal gets passed that is in the best interests of Britons.
The new reports and findings cast a different light on the Brexit proceedings and underscore the importance of such a historic event. With politicians and negotiators aware of what is at stake, there is a chance that they will be more motivated to stay the course and put together a plan that works for both sides and the economic safety of everyone involved.