Mid-day guest Podcast Podcast

Brexit: "The Irish border issue is a headache for Johnson"

This Wednesday, the new British Prime Minister is in Northern Ireland where he will meet with the leaders of the main political parties to try to ease concerns about the future of the Irish border in case of Brexit without agreement. The lighting of Catherine Mathieu, economist at the OFCE, specialist of the United Kingdom and European questions.

RFI: Yesterday Boris Johnson assured his Irish counterpart that he would never put physical control in both Ireland. In what position is the British Prime Minister today?

Catherine Mathieu : Boris Johnson actually wants the United Kingdom to leave the European Union on October 31st. He also wants the EU to reopen negotiations on the issue of the "safety net" [the so-called "backstop"] which is provided for in the withdrawal agreement signed today by the European Union and Theresa May [ the previous Prime Minister]. Agreement that there will be no return of the border between Northern Ireland and the Republic of Ireland, and that to avoid this return, the United Kingdom could remain in the Customs Union.

This is really a problem for Boris Johnson today: if the United Kingdom comes out in compliance with the agreement signed by Theresa May, it will remain possible in the customs union and therefore will not be able to sign agreements. free trade with other countries outside the European Union.

► Read also: Boris Johnson makes his first official visit to Scotland

Boris Johnson wants this to be rediscussed, so that there is a clear and clear exit from the EU, but he also wishes to preserve the peace agreements in Ireland, which date from 1998. But for these agreements remain in force there must not be a return of the border [between the two Irlandes]. This question of the Irish border is therefore a real headache.

A few days ago, the British Administration Minister, Michael Gove, in charge of this thorny issue of Brexit, said that the " no deal " was the working hypothesis of the government. Does this mean that Brexit looming is likely to be without agreement ?

If the position of the European Union remains unchanged - and today European leaders say there will be no reopening of the withdrawal agreement - we do not see how the United Kingdom could come out with an agreement . An exit without agreement seems possible.

Gove has been appointed to put in place a number of measures related to an exit without agreement. But all the same, Boris Johnson repeats that he wants an exit with agreement. This supposes that the EU agrees to rediscuss but for now it says no.

Maybe we will not go to this standoff, precisely because the economy worries. What can we expect if Brexit is without agreement, precisely?

If Brexit is without agreement and it is done in conditions where there is no opening of negotiations between the European Union and the United Kingdom, we can expect there to be a high volatility on the financial markets. We already see that the pound has fallen in recent days.

The commercial links are very strong. Today, roughly half of UK exports go to the European Union. And for the countries of the European Union, the United Kingdom also represents a large market, starting with France. So all the European economies would be affected. But, of course, the UK and Ireland would be the most negatively affected in the short term by an exit without agreement.

And the different sectors are worried, especially that of the automobile. We learned today : the Association of Automobile Manufacturers and Vendors (SMMT) announce that investment in the UK sector has decreased by 70% in the first half. What can these companies do today ?

Today, British companies are trying to convince the British government that it is important to avoid an exit without agreement. Indeed, there are signs of a sharp slowdown in investment in the UK auto industry.

What automotive companies are waiting for is what kind of UK exit will take place. If there is an agreement, UK auto companies can continue to import parts and export vehicles in a very simple way.

If it is an exit without agreement, indeed, the car manufacturers say that it will be very difficult for the British automotive sector. In fact, today in the UK, as in the European Union, there are many structural problems for car manufacturers, including the fact that there are diesel standards that are now tougher . There are many issues that are not only Brexit-related but also necessary changes to the mode of production.

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