Ireland says UK demand for Brexit deal change is ‘wishful thinking’

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LONDON/BRUSSELS (Reuters) – Ireland accused British Prime Minister Theresa May of wishful thinking on Wednesday for seeking to renegotiate a post-Brexit arrangement for the Irish border in an attempt to get backing for Britain’s EU divorce deal in parliament.

Other European Union leaders had quickly dismissed the idea of reopening the deal, saying the Irish “backstop” was not negotiable, shortly after parliament instructed May to do just that in a vote on Tuesday.

Less than two months before the United Kingdom is due by law to leave the EU on March 29, investors and allies are trying to gauge where the crisis will end up, with options including a disorderly ‘no-deal’ Brexit, a delay, or no Brexit at all.

Two weeks after overwhelmingly rejecting the deal May had agreed in Brussels in two years of talks, a 317-310 majority in parliament demanded she secure a replacement for the backstop, an insurance policy that aims to prevent a hard border being erected between Ireland and Northern Ireland.

In essence, she will use the implicit threat of a ‘no-deal’ Brexit to clinch a deal from the other 27 members of the EU, whose combined economy is about six times the size of Britain’s.

The European response has been blunt.

Simon Coveney, foreign minister of Ireland, whose economy stands to suffer most from a ‘no-deal’ Brexit, said Britain had not offered any feasible way to keep the border open.

Ireland also has a huge interest in preserving a deal that has maintained sectarian peace in neighbouring Northern Ireland for two decades, not least by scrapping all border checks.

“What we are being asked to do here is to compromise on a solution that works, and to replace it with wishful thinking,” he said.

Ireland’s Minister for Foreign Affairs Simon Coveney speaks about Brexit at the “State of the Union 2019” event in Dublin, Ireland January 30, 2019. REUTERS/Clodagh Kilcoyne

“NO RENEGOTIATION”

France said there would be no renegotiation of the deal already agreed. European Council President Donald Tusk, due to hold a call with May at 1745 GMT, referred to the backstop in saying the deal would was “not open for renegotiation”.

European Commission President Jean-Claude Juncker stuck to the same line, adding that Brussels still did not know what Britain wanted and that the chances of a ‘no-deal’ exit had increased.

Currency traders also took that view as sterling traded around $1.3070, more than a cent down from the level reached before MPs voted on Tuesday.

Heiko Maas, foreign minister of the EU’s leading power, Germany, said the British government “must now say quickly what it wants, because time is running out”.

“We are ready to talk,” he said, before adding: “Our position is clear: the Withdrawal Agreement is the best and only solution for an orderly exit.”

While the EU has repeatedly refused to reopen the divorce deal, EU sources said additional clarifications, statements or assurances on the backstop might be possible.

May has said she needs more — a legally binding change. She aims to get parliament’s approval for a revised deal on Feb. 13. If that fails, parliament will vote on next steps on Feb. 14.

That deadline ratchets up the pressure on dedicated Brexiteers in the Conservative Party who fear opponents will try to delay and ultimately thwart Britain’s exit.

CORBYN MEETING MAY

Both May’s Conservatives and the main opposition Labour Party are formally committed to carrying out Brexit but internally divided over how or even whether to do so.

Brexiteers accept there is likely to be some short-term economic pain but say Britain will thrive in the long term if cut loose from European rules. Pro-Europeans say Britain’s exit will make it poorer, reduce its global clout, undermine London’s position as a global financial capital and weaken the West.

Britain voted 52 percent to 48 percent to leave the EU in a 2016 referendum. Brexit supporters say it would betray democracy to fail to act on that mandate. Opponents say voters may have changed their minds now that the details are becoming clearer.

Opposition Labour leader Jeremy Corbyn, who favours a much closer relationship with the EU, built around a customs union, met May to discuss Brexit.

“Jeremy made the case for our alternative plan,” the spokesperson said, adding that the tone had been “serious and engaged” and that the two had agreed to meet again.

If May cannot get a deal agreed, the default option would be to exit the EU abruptly with no deal at all, which businesses say would cause chaos and disrupt supply chains for basic goods.

“This will hit Britain harder than others,” German Economy Ministry Peter Altmaier said. “The coming days must be used to finally prevent a hard Brexit.”

British lawmakers on Tuesday approved a proposal calling on the government to prevent a no-deal exit, sending a signal that a majority opposes it. However, they rejected two amendments that set out a clear path for parliament to prevent it.

Many company chiefs are aghast at London’s handling of Brexit and say it has already damaged Britain’s reputation as Europe’s pre-eminent destination for foreign investment.

The investment bank Goldman raised its probability of a no-deal Brexit to 15 percent from 10 percent, kept its probability of a delayed Brexit at 50 percent, and revised down its probability of no Brexit to 35 percent from 40 percent.

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