EU, Britain reach new Brexit deal but uncertainties still remain

2019-10-18 02:36:16 GMT2019-10-18 10:36:16(Beijing Time) Xinhua English
British Prime Minister Boris Johnson (2nd L), British Brexit Secretary Stephen Barclay (1st L), President of the European Commission Jean-Claude Juncker (2nd R) and the EU's chief Brexit negotiator Michel Barnier pose for photos after meeting the press at the European Commission headquarters in Brussels, Belgium, Oct. 17, 2019. The European Union and Britain have reached a new Brexit deal, Jean-Claude Juncker said Thursday on his twitter account. (Xinhua/Zheng Huansong)  British Prime Minister Boris Johnson (2nd L), British Brexit Secretary Stephen Barclay (1st L), President of the European Commission Jean-Claude Juncker (2nd R) and the EU's chief Brexit negotiator Michel Barnier pose for photos after meeting the press at the European Commission headquarters in Brussels, Belgium, Oct. 17, 2019. The European Union and Britain have reached a new Brexit deal, Jean-Claude Juncker said Thursday on his twitter account. (Xinhua/Zheng Huansong)

BRUSSELS, Oct. 17 (Xinhua) -- After rounds of day and night negotiation, leaders of the European Union (EU) and Britain declared Thursday that they have reached a new Brexit deal.

Despite cautious optimism over the new deal among EU members, fears of its failure in British parliament prevail in the air at the other side of the English Channel.

"FAIR, BALANCED" DEAL

"Where there is a will, there is a #deal we have one! It's a fair and balanced agreement for the EU and the UK and it is a testament to our commitment to find solutions," said Jean-Claude Juncker, president of the European Commission, on his twitter account.

"We now have a newly agreed Protocol that protects peace and stability on the island of Ireland and fully protects our Single Market. I hope that we can now bring this over the line and provide the certainty our citizens and businesses so deserve," he noted in a press release published by the Commission.

Michel Barnier, the European Commission's chief negotiator, hailed the deal as "all-win".

"We had difficult discussions over the past days. We have managed to find solutions that fully respect the integrity of the Single Market. We created a new and legally operative solution to avoid a hard border, and protect peace and stability on the island of Ireland. It is a solution that works for the EU, for the UK and for people and businesses in Northern Ireland," said Barnier in the press release.

On thorny issues like the Irish border, which is the main obstacle for the two negotiating teams, the new deal offers new measures.

First, Northern Ireland will remain aligned to a limited set of EU rules, particularly related to goods.

"This means that all of the procedures will be taken into account in Northern Ireland and not across the island. For the purpose, UK authorities will be in charge of applying the Union Customs Code in Northern Ireland," Barnier told a press conference.

At the same time, Northern Ireland will remain in Britain's customs territory as an entry point to the EU Single Market. This will be beneficial for Britain's future trade policy, said Barnier.

"UK can apply authoritative UK tariffs on products coming from third countries, so long as those goods reviews entering Northern Ireland are not at risk of reviews entering our Single Market. However, for goods at risk of entering the Single Market, UK authorities will apply the EU's tariffs," said Barnier.

The only remaining open question seems to be VAT regime in Northern Ireland, which, according to the EU, is an important subject to avoid distortion of competition within the Single Market for goods.

According to the website of POLITICO's Europe edition, Britain has asked for Northern Ireland not to be subject to the EU's VAT rules.

It may not seem like much, but it is problematic for the EU. Because if Britain decided to lower its tax rates, there would be problems on ensuring a level playing field, POLITICO noted.

"We were working on the issue of VAT. We managed to achieve two objectives: Maintain the integrity of the Single Market but also satisfy the UK's legitimate wishes," said Barnier.

"Four years after the entry into force of the Protocol, the elected representatives of Northern Ireland will be able to decide, by simple majority, whether to continue," he added.

WELCOMED BY IRISH SIDE

On the Irish side, the new Brexit deal is widely welcomed.

The deal protects the wishes of the people of Northern Ireland and also avoids a hard border between Ireland and Britain's Northern Ireland, said Irish Prime Minister Leo Varadkar.

"It is a good agreement allowing the UK to leave the EU in an orderly fashion with a transition period which is very important for businesses and citizens across the EU and UK," he told Irish media RTE Thursday.

Compromises had to be made to protect Ireland and the EU for securing the new deal and he was comfortable with the concessions which include compromises on a timescale and the consent issue as the deal fulfilled Ireland's objectives, he added.

Micheal Martin, leader of Fianna Fail, the largest opposition party in Ireland, said that he welcomed the new Brexit deal although he believed that it was "not ideal".

He told RTE that the new deal has offered economic reassurance and would avoid a hard border on the island of Ireland.

Michelle O'Neill, deputy leader of Sinn Fein, another major political party in Ireland, which also has political presence in Northern Ireland, told local media in Belfast that she welcomed the fact that a deal had been reached but her party needed time to digest the details of the new agreement.

UNCERTAINTIES STILL REMAIN

In another development, the Democratic Unionist Party (DUP), British Prime Minister Boris Johnson's ruling partner and the main party in Northern Ireland, said in a statement that it could not support the deal. This cast a shadow over the fate of the deal in British parliament where Johnson's conservative party doesn't enjoy a clear majority.

The British pound lost 0.5 percent against the U.S. dollar and the euro within minutes of the DUP statement.

DUP support for Johnson's Brexit proposals are seen as crucial to ensure it has a better chance of getting backing in the House of Commons on Saturday.

"As things stand, we could not support what is being suggested on customs and consent issues and there is a lack of clarity on VAT (value added tax)," DUP leader Arlene Foster and deputy leader Nigel Dodds said in a statement.

"We will continue to work with the government to try and get a sensible deal that works for Northern Ireland and protects the economic and constitutional integrity of the United Kingdom," it said.

But for Juncker and many EU leaders, the new deal means that there is no need for any kind of prolongation, thus it is a "this deal or no deal" choice for British parliament.

Following a referendum in which 52 percent of voters supported withdrawal in June 2016, the British government invoked Article 50 of the Treaty on European Union and started a two-year Brexit process which was originally scheduled to conclude with London withdrawing from the EU on March 29, 2019.

As the British parliament refused to ratify documents negotiated between former Prime Minister Theresa May and the EU, that deadline has been extended twice.

Johnson has insisted that Britain will leave the EU, with or without a deal on Oct. 31.

 

 

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