Prof Ingrid Shikova: EU deal with UK is not finished

Despite the optimistic tone of politicians, everyone left the negotiations equally unhappy

The UK's selective approach and its willingness to take advantage mainly of the large European market - what the term cherry-picking implies in English - could have set a bad precedent, undermining the logic of the European integration process. It was extremely important to apply the principle of achieving the right balance between rights and obligations. I think the last thing both sides wanted was to trade under the rules of the World Trade Organisation, says Ingrid Shikova, professor in EU policies, in an interview to EUROPOST.

Ms Shikova, the Brexit trade deal was reached at the last minute, and after the nerve-wracking negotiations it did not become clear who made a greater compromise - the EU or the UK. According to you, which side yielded at the end?

During negotiations, both sides always make compromises. It was largely a game of brinkmanship. As we know, fishing quotas had remained the last unresolved issue. Finally, both sides compromised to reach an agreement a week before the deadline. Experts no longer believed that this would happen.

When discussing Brexit and the trade agreement, we have to keep in mind that the UK is a special case and the negotiations have been very specific. In fact, the UK, as a member of the European Union, has always been associated with the keyword “special” - a special position, a special attitude, a special status, and special arrangements. On the other hand, this is a special case indeed, because for the first time future relations are being negotiated after “divorce”. Usually, in trade negotiations trade is liberalised, while in these negotiations it was necessary, from participating in the single market, to negotiate an agreement that would cause the most limited damage to both sides.

The negotiations were very tough, I would even use the word “painful”. The UK's selective approach and its willingness to take advantage mainly of the large European market - what the term cherry-picking implies in English - could have set a bad precedent, undermining the logic of the European integration process. It was extremely important to apply the principle of achieving the right balance between rights and obligations. A country that leaves the EU cannot have the same rights and benefits as EU Member States.

However, it must be underlined that it was not in the interests of either the UK or the EU not to reach a trade agreement and to trade between themselves by imposing duties and other restrictions. The EU is the UK's biggest trading partner. In 2019, the UK's exports to the EU amounted to £294bn (43% of all UK exports). UK imports from the EU amounted to £374bn (52% of all UK imports). It is obvious that the question is about significant commercial interests that needed to be protected. I think that the last thing both sides wanted was to trade under the rules of the World Trade Organisation.

Moreover, in the last days of 2020, the British realised in practice what closing the borders meant, with the thousands of trucks, which also had its psychological impact.

Experts say that both sides should leave the negotiations equally happy or equally unhappy. Despite the optimistic tone of the politicians, I think that everyone left the negotiations equally unhappy. Politicians have welcomed the agreement, but the fishermen on both sides of the English Channel felt unhappy.

Has the EU sufficiently protected the interests of the European companies and citizens working in the UK?

On 31 December 2020, the UK left the EU single market and the customs union, but the EU and the UK will trade duty-free and with no quantitative restrictions. Many issues have been agreed in the 1,246-page trade agreement allowing for a smoother relationship after the “divorce”.

EU Member States' opinion is that the interests of the European companies are protected by this agreement. “The deal with the UK is essential to protect our citizens, our fishermen, our producers,” said French President Emmanuel Macron, adding our European unity as well, but he did not fail to stress the need for “united, sovereign and strong Europe”. EU President Ursula von der Leyen is of the same opinion: “The negotiations were very tough. But with so much at stake, for so many, this was a deal worth fighting for. … It will protect European interests.”

The work of Michel Barnier, the EU chief negotiator, should be highly praised. I will quote his words after the end of the negotiations: “Today is a day of relief but tinged by some sadness… Despite this agreement, there will be real changes … for many citizens and businesses.” These are the consequences of Brexit according to him.

Michel Barnier recalled that this is a “free trade agreement, with no tariffs or quotas on any goods,” adding that it will be a hallmark for the EU for its future trade deals.

It should be very clear, however, that the reached agreement would reduce but cannot eliminate the damage that - although asymmetrically - will be caused to the UK and the EU by Brexit. There are no customs duties, but there is a customs border, and there are many more administrative formalities and documentation.

A complex structure of committees has been established to monitor the functioning of the agreement. It is inevitable that irregularities and omissions will occur in the coming years. A comprehensive review of the operation of the agreement is foreseen every five years. In addition, either party may withdraw from the agreement only with twelve months' notice. Most analysts assert that this agreement certainly cannot be considered as final for the long-term relationship between the EU and the UK. A reading of the text signed on 24 December shows that the deal is not finalised, as important aspects of the future relationship between the UK and the EU remain to be agreed - for example financial services, data issues and recognition of professional qualifications.

Perhaps even more indicative of the agreement's temporary nature is the philosophy behind its provisions on “equal conditions” or equality. If one of the parties tries, for example, to gain an advantage by undercutting the other one - by lowering standards or allocating state subsidies, the other party is entitled to defensive countermeasures. Maybe this arrangement was a result of the mistrust that arose because of the UK Internal Market Bill, which was in breach of the EU-UK Withdrawal Agreement. Such actions raise suspicions on loyalty in the future relationship. It is not clear what exactly the British government's behaviour will be - whether it will want to demonstrate the constantly accentuated sovereignty by adopting standards and norms which differ significantly from those of the EU.

I think that the level of trust between the EU and the UK is low, and loyalty is a very important principle of the future relations. What the EU is apprehensive about is the UK's possible disregard of the arrangements.

What is the biggest change that will be noticed in the coming days and months?

The real consequences of UK leaving the bloc will gradually become apparent. Companies will face a series of new and time-consuming formalities stemming from the country's exit from the single market and customs union. Citizens will be able to travel for tourism without visas, but they will need international passports. If they want to work, they will need a visa and a permit. The European Health Insurance Card, which is held by all EU citizens, will no longer be valid in the UK and there will be a need for health insurance. University students will also be affected by Brexit. It is disappointing that the UK has withdrawn from the Erasmus exchange programme, which will limit the opportunities that this successful programme offers to young people to study abroad.

Scotland has vowed to return to the European Union family. What are its chances?

Whether the UK will be able to survive, once the effects of leaving the EU are felt in practice, is one of the key political issues. The elections in Scotland will be conducted in May 2021 and public opinion polls confirm the desire for independence. The separation of Scotland and its return to the EU is not impossible, but it is unlikely at this stage. It seems hardly possible that London will allow Scottish independence. The current arrangements for Northern Ireland will continue to strengthen the debate on the Irish reunification. Some analysts point out that resolving the Irish problem is far from finally agreed, with all the risks it poses to political and constitutional instability in Northern Ireland. With a little more imagination, however, we can envision a situation that could be possible in a certain number of years - Northern Ireland joining the Republic of Ireland, forming a united Ireland, and Scotland becoming an independent EU Member State.

This potential fragmentation of the UK will certainly bring the European question forward, contrary to the current government's assertion that the European question is concluded.

The EU-UK “divorce” seems to have a sobering effect on those who potentially wish to follow the UK. Don't you think that the Eurosceptics are increasingly losing support among the European citizens and that a domino effect will not happen?

This agreement marks a victory for a so-called “Barnier method” - the unity of the 27 EU Member States was retained in the negotiations with the UK. Which gives a very clear signal that the EU Member States, despite some differences in their interests, are able to be united and to defend together their European interests. There were some attempts by the UK to divide the countries and to hold bilateral negotiations, but they failed.

If we go deeper and take into consideration the different Brexit aspects, we must be very careful in assessing the prospects for differentiation and the impact of Brexit. Opinions of analysts and experts differ. According to one observer, when the big troublemaker leaves the room, the EU can speed up the path to an “ever closer union”. Others believe that Brexit's reformist impulse can help reform the EU into a more differentiated system that will house the countries wishing to integrate at different speed. This shows that Brexit's lessons are open to interpretation. However, the leaving of the UK is a serious lesson and we can learn from it. It is not reasonable to ignore differences in the opinions of countries and citizens. These differences should be openly discussed and compromises should be sought. Perhaps integration will be developed through the European Union of unions - economic and monetary union, banking union, energy union, digital union, health union, social union.

For last, I would allow myself to quote the Portuguese PM Antonio Costa: “Brexit was a big enough rift and nobody wants any more.”

Close-up

Prof Ingrid Shikova is a founder of the European Studies Department at Sofia University “St Kliment Ohridski”. She has devoted her entire professional career to European integration. Prof Shikova has been Director of the Centre for European Studies as well as Director of the Information Centre of the Delegation of the European Commission to Bulgaria and advisor to the European Commission Representation. She is a member of the Academic Council of the International Centre for European Training in Nice. Prof Shikova was bestowed for her contribution to the development of European studies in Bulgaria with the highest distinction of the University - honorary sign with a blue ribbon. At present, she is Head of the Jean Monnet Center of Excellence at the European Studies Department of Sofia University “St Kliment Ohridski”.

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