Draft Brexit Withdrawal Agreement Explained

What’s it all about?

Our Independent Economic Consultant, Peter Stanyer provides a brief summary of the content…

As you’ll all be aware, on Wednesday evening, after a long tense meeting with her cabinet, Theresa May managed to secure their backing for a Brexit draft deal which she says will deliver “on the vote of the referendum”.

A 585 page draft withdrawal agreement was subsequently published.  Our Independent Economic Consultant, Peter Stanyer has summarised the contents below, together with a link to a range of articles representing both sides of the argument:

Peter comments:

The resignations of Dominic Raab and Esther McVeigh hours after the publication of both the UK – EU draft withdrawal agreement and the summary of the proposed longer term relationship between the UK and EU give an indication of the difficulties Mrs May now faces in winning support for the proposed agreement.  

It can be very difficult to see the wood for the trees in a lengthy legal agreement but in broad terms:

• One perspective is that the EU has been able to keep its eyes firmly on its long term interests of protecting the single market and preventing the longer term disaster for Brussels if Brexit was in time reckoned to be a success.  In particular, the EU appears determined to rule out the prospect of the UK evolving into a successful, highly competitive, low tax, lighter regulated very large “Singapore” sitting a very short distance from France.
• The UK’s negotiators on the other hand have become increasingly focussed on the immediate dangers that a failure to reach an agreement could cause great disruption to trade and commerce while undermining the Good Friday agreement for the Island of Ireland.  The UK has also been persuaded that work-arounds for these challenges are too difficult in the short term. 

Summaries often reflect different sources of bias and different news organisations inevitably reflect their own perspectives.  However, here are a few useful links, chosen because they are both brief, and reflect different points of view, without straining excessively to be impartial (which some argue hinders the BBC’s perspective):

• CNN
• Politico
• The Guardian
• The Evening Standard
• The Express

This is just the first in a series of hurdles which will need to be overcome, including a stamp of approval from parliament and the 27 other EU member states.  We continue to watch this space…

Peter Stanyer is co-author with Professor Stephen Satchell of The Economist Guide to Investment Strategy, 4th edition, Profile Books, 2018. The views expressed are his own personal views, and do not constitute advice to buy, sell or hold any investment.