EU Commission President Ursula von der Leyen and British Prime Minister Boris Johnson met for dinner on Wednesday to make progress in negotiating the follow-up agreement after the Brexit transition period. An agreement in the coming days is more than uncertain, even if both parties assert that they will strive for a solution by Sunday.
But a beginner’s course in negotiation tactics is enough to know that such a tête-à-tête does not lead to success. From a negotiating point of view, there is still “forever” time. It only gets really explosive on December 31st just before midnight. That is how long a grace period applies to Great Britain.
If one of the two sides buckles too early, this could weaken one’s own interests. That is why the Brexit issue will probably remain with us for the coming week. Even in extreme cases, it could be until December 31st. can be negotiated further in order to reach a solution shortly before the end of the year, which will then be formally adopted by the EU Parliament, the EU Council of Ministers and the British Parliament with a short extension of the transition period in the new year.
But even if the UK were left without a follow-up agreement on January 1, 2021, it would still be possible for the negotiating partners to continue to hold on to talks in order to find a solution in the new year. Perhaps both parties must first learn painfully how serious such a hard separation can be. In any case, there are no limits to diplomacy. It is very unlikely that two such important and geographically close trading partners will part ways forever without an agreement. An agreement will be reached. How, when and in what way remains to be seen
Meanwhile, the foreign exchange markets are also confident that a solution will be found. There were no further significant losses despite the back and forth for the British currency. The further fate of the pound remains intertwined with the question of a follow-up agreement. If there is a follow-up agreement, the pound will be able to gain significantly. In the opposite case, there is probably another risk of painful setbacks.
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