Europe In The 2020s

Why Brexit could have significantly different outcomes for Brussels and London

- Andrew Hammond

The historic UK-EU trade deal secured on Christmas Eve, which took effect on New Year’s Day, is seen by many as the end of Brexit. Yet, the huge, wide ranging processes unleashed by the UK’s 2016 referendum are only just beginning to play out in ways that could have contrasting implications for the EU and United Kingdom.

For while the 2020s could potentially see a more federal, centralised EU after the UK’s departure, the opposite may be true for the United Kingdom itself. With pressures growing for Scottish independence and potentially even Irish reunification, the 2020s are an uncertain time for the union of England, Scotland, Wales and Northern Ireland.

The immediate backdrop for this is December 24’s trade breakthrough which is, mostly, welcome news for European and wider global business after more than five years of Brexit uncertainty. However, this is tempered by the fact that the agreement is the first international trade negotiation in history where barriers go up, rather than down, compared to the status quo, and it does not cover the services sector which accounts for 80% and 70% respectively of the UK and EU economies.

Much attention, in the last half decade, has focussed on these trade (and the earlier withdrawal) negotiations between the EU and United Kingdom. This has obscured the fact that the UK referendum set off a much wider set of changes.