UK on collision course with Brussels over City

Written By: Chris McLaughlin
Published: March 9, 2018 Last modified: March 9, 2018

Chancellor Philip Hammond has placed Britain on a collision course with Brussels in the middle of a rebuff to Prime Minister Theresa May over her vision for the UK’s post-Brexit relationship with the European Union.

Hammond sowed the seeds for a row with a warning that Britain would reject any Brexit deal that does not include financial services, focusing on the City of London. His threat, made during a speech in Canary Wharf, cast a potential stalemate over negotiations on a future trade deal over the entire Brexit arrangements.

Talks had already run into trouble after the president of the European Council, Donald Tusk, unveiled the union’s outline plan for a Brexit deal which rules out what he called the Prime Minister’s “pick and mix” approach to the talks.

He said: ”I fully understand and respect Theresa May’s political objectives to demonstrate at any price that Brexit will be a success and was the right choice. I’m sorry, this is not our objective.

On a visit to Luxembourg Tusk (pictured) said: “No member state is free to pick only those sectors of the single market it likes nor to accept the role of the ECJ (European Court of Justice) only when it suits their interest. By the same token a pick and mix approach for a non- member state is out of the question..”

Amid a looming row with Britain’s fishermen over the future of the industry, Hammond’s speech looked certain to create yet another impasse with Brussels, warning European countries against any attempt to “steal” finance industry business from London. It was time, he suggested, to “address the sceptics who say a trade deal including financial services cannot be done because it has never been done before”.

Responding to Tusk’s comments, he said it was not surprising that the EU had established a “very tough position” against Britain’s proposal that financial services – worth £3 to – be included in any trade deal. “We should be under no illusion about the significance and additional costs if this highly efficient market were to fragment,” he said.

His words will reignite fears of a hard-Brexit outcome.

About Chris McLaughlin

Chris McLaughlin is Editor of Tribune