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UK Conservatives’ victory ends Brexit debate

22:43 | 28.12.2019 | Analytic

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28 December 2019. PenzaNews. The Conservatives’ convincing victory in early UK elections on December 12, which resulted in their record majority in the House of Commons from Margaret Thatcher’s time, will allow Prime Minister Boris Johnson to fulfill his promise to end Brexit and withdraw the United Kingdom of the EU by 31 January 2020.

UK Conservatives’ victory ends Brexit debate

Photo: Jess Taylor, Flickr.com/uk_parliament

Commenting on the results of the vote, the Tory leader told the Financial Times that the Conservative government now has “a powerful new mandate to get Brexit done [...] to unite this country and to take it forward.”

A week after the election, on December 20, the British Parliament supported in the second reading the draft law on Brexit introduced by Boris Johnson. 358 deputies spoke in favor of its adoption, 234 voted against it. The document establishes not only the period of exit from the European Union, which has been postponed three times, but also the date of completion of the transitional period during which the United Kingdom will revise its previous agreements with the EU until 31 December 2020. The final reading of the bill will take place in January.

However, the president of the European Commission, Ursula von der Leyen expressed the opinion that 11 months allotted for negotiations may not be enough to discuss further relations between Great Britain and the European Union after Brexit.

“I have serious concern about the limited time available. It’s not only about negotiating a free trade deal but many other subjects. It seems to me that on both sides we must ask ourselves seriously if all these negotiations are feasible in such a short time. I believe that it would be reasonable to review things in the middle of the year, if necessary to see if an extension is needed,” she said in an interview with the French newspaper les Echos.

Ursula von der Leyen also reminded that to access the single European market, London will have to comply with EU rules and guarantee comparable conditions for the production of goods and services.

“I deeply believe in the need to maintain good relations with our neighbors. We have enough [resources] to promote our economy. And we would like to include our British friends in this environment,” the president of the European Commission said.

Analyzing the situation in the United Kingdom, Neil MacKinnon, Global Macro Strategist at VTB Capital, called the election results a clear signal of citizens’ desire to complete the process of disconnection from the EU as soon as possible.

“The UK election vote made it very clear that UK voters want Brexit to be delivered. This is why Labour had its worst vote since 1935 as Labour failed to give a clear view on its Brexit policy,” the expert said.

He added that positively assesses the economic consequences of Brexit under any conditions of its implementation.

“It also allows the democratic result of the 2016 referendum result to be implemented and paves the way for positive opportunities from the exit from the EU even in the event of a “no deal” scenario which in actuality would be to the disadvantage of the EU given that the UK is one of the EU’s main export markets,” Neil MacKinnon explained.

According to him, the UK election results lift the political uncertainty that has been in place especially during 2019 and the clear majority for the Conservative Government is therefore positive for the UK economy.

In turn, Michael Emerson, associate senior research fellow at Centre for European Policy Studies (CEPS), former Ambassador of the EU to Russia, said that “the election result was greeted with a big sigh of relief,” because the country managed to overcome the paralysis of the parliament.

“The result is due partly to Boris Johnson's popular appeal – he is quite witty, amusing and charming in manner, even if he is a wildly extravagant promoter of implausible ideas like the UK to be the ‘greatest place on earth’,” the expert said, comparing the British Prime Minister with US President Donald Trump.

From his point of view, the Leader of the Labour Party, Jeremy Corbyn is dead now politically as he tried to promote neo-Marxist ideas about return to state ownership of public utilities, big taxes on the rich, and a zero personna.

The bad results of the Liberal Democratic Party, in his opinion, can be explained not only by the fact that they advocated scrapping Brexit with even a second referendum, but also “because the simple majoritarian constituency electoral system, with no element of proportional representation is so biased against smaller parties.”

He drew attention to the fact that, in addition to the conservatives, the Scottish National Party was another big electoral winner, whose big gain makes the prospect for second referendum on Scottish independence all the more inevitable now.

“Johnson will enjoy a few days of honeymoon bliss, then back to the tough realities of governing a country that will be depressed by the negative impact of Brexit. He succeeded by playing on the public opinion that the Brexit affair had been going too long, and needed closure. But to get even a minimally negative impact will be extremely difficult,” former Ambassador of the EU to Russia said.

According to Craig Erlam, Senior Market Analyst, OANDA, despite the majority victory for the Conservative government, there is still a lot of division in the country that will only likely be resolved by moving past Brexit.

“It’s clear that this was a huge issue in the election that aided the Conservatives and once it’s passed, normality may resume. While Boris hopes that this will be the start of 2021, that’s an extremely optimistic deadline and many fear that won’t be possible,” the expert explained.

He was convinced that until then, the atmosphere in the country will remain hostile around Brexit.

“I don’t expect that the atmosphere is going to change too dramatically, although the broken deadlock in Parliament will undoubtedly help. It Parliament should soften the hostility towards MPs and the frustration among Brexiteers. The debate will only likely cease though once the transition has passed,” Craig Erlam suggested.

“I think the previous week was an important step towards this though, whether you’re on the side of Brexit or Remain as most people agree that the status quo had become unbearable,” OANDA Senior Market Analyst said.

Meanwhile, Kent Matthews, Professor of Banking and Finance at Cardiff Business School, identified three main groups of voters in the elections.

According to him, the first group was the remainers who saw no future for small European nations outside a European power bloc: while the language of remainers was couched in terms of economic benefits, to them the future was going to be dictated by rapacious power blocs – the USA, China, Russia; and the only way a small European country is to survive in this neo-Hobbesian world is to transfer sovereignty and power to a supra-national political entity as the European Union.

The second group, in his opinion, included the Brexiters who see the restoration of sovereignty as the only way the UK can go forward.

“They also couched their arguments in terms of economic benefits in a free trade world outside the EU but the underlying motive was the recognition of the nation state as a political entity,” Kent Matthews explained.

“The third group were those who wanted the country and the economy to have some direction after three years of vacillation. Most of these found a resonance in the Conservative party rallying cry – ‘get Brexit done’,” he added.

At the same time, in his opinion, Brexit was not the only factor.

“The radical programme proposed by the Labour party was widely viewed as not credible. The promise of nationalisation of utilities, the eradication of student debt, removal of student fees, free broadband, free social care for the elderly, massive NHS spending, backdated pension payments to women – and all this to be paid by the rich alone, was not accepted as deliverable,” the analyst said and added that the election was as much a rejection of big government Soviet type economics and the re-affirmation for the soft-capitalism espoused by the one-nation Toryism of the Conservative party.

According to him, the large victory for the Conservative party means that the Prime Minister Boris Johnson does not have to depend on the right-wing group in the party and can regain the centre ground abandoned by the Labour Party.

“The future for the economy and the body politic in the UK is that government will move back to the centre, which will see more spending on the NHS and other public services but retaining a competitive corporate tax system, a business friendly environment and even lower taxes for households. Another likely outcome is a softer Brexit than that envisaged by the right-wing of the party,” Kent Matthews concluded.

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