Internal Market Bill Poses Risk to Good Friday Deal That US Wants to See Preserved, Prof Says

Four US lawmaker sent a letter to UK Prime Minister Boris Johnson about the repercussions of the Internal Market Bill on the future of US-UK trade relations post-Brexit. The much-debated bill, stipulating certain amendments to the Withdrawal Agreement, passed the House of Commons on Tuesday.

Dr Mark Shanahan, associate professor and head of the Politics and International Relations Department at the University of Reading, believes that the risk of undermining the Good Friday Agreement that now exists after the adoption of the Internal Market Bill could botch the UK chances to clinch a trade deal with the United States.

Sputnik: Four American Congressmen have warned Boris Johnson there will be no trade deal with the US if the Internal Market Bill passes. They warned that the bill could see a US-UK trade deal dropped. To what extent could this disarray affect the ‘special relationship’ between the two countries?

Mark Shanahan: The Special Relationship has always appeared stronger in London than in Washington DC. While it continues powerfully at an operational level around security and intelligence, its political value waxes and wanes, often depending on the personal relationship between the President of the US and the UK Prime Minister. However, it is always asymmetrically in favour of the US. Prime Minister Johnson is putting his faith in a continuing Trump Presidency and a compliant Congress. He may still get the former after the election, but will get little support for a favourable trade deal from a Democrat-led House of Representatives who actually hold the power since any future trade agreement would have to be approved through Congress.

Both Houses of Congress lean towards Ireland (and therefore the EU) in terms of general sentiment, but given the US role in brokering the Good Friday peace deal in 1998, there is a massive loyalty to preserving the integrity of that deal and not putting it under risk. The UK Internal Market Bill does raise the risk since it makes a hard border between Northern Ireland and the Republic of Ireland far more likely. Congress will see that as turning the clock back 20+ years on sectarian progress and thus are hardly likely to look sympathetically at the UK when it comes looking for a Free Trade Agreement. Beyond the PR hype, the UK may actually realise that it’s a lot less special than the EU. 

Sputnik: In your view, does the Internal Market Bill indeed threaten the Good Friday Agreement? Why?

Mark Shanahan: Yes it does – and a long answer here. It comes down to a differing view on state aid and on customs regulation. Clause 42 enables the UK government to change how the Northern Ireland Protocol within the Withdrawal Agreement applies of exit procedures for goods – it’s designed to enable a level playing field for goods trades across the nations of the UK, but this comes into conflict with the EU who sees the NI protocol making special provision for Northern Irish goods to ensure continuing free trade across the EU border with the Republic of Ireland. Clause 43 gives the  Secretary of State powers to apply different state aid provisions rather than following EU rules as contained in the protocol. For instance, the UK may want to enhance the competitiveness of a particular industry – and this will bring it into conflict with what’s in the Withdrawal Agreement. Clause 45 sums all this up, affirming UK domestic law trumps relevant international and indeed devolved domestic law, including any provision of the EU Withdrawal Agreement and the Northern Ireland Protocol.

In short, passing the bill allows the UK government to alter the effect of the treaty agreed between the EU and the UK. That seems to open a chasm between the UK and EU positions and increases the chances hugely of the UK completing transition without a trade agreement with the EU. If that is the case, it shifts the border between the EU and the UK from the Irish Sea to the land border between the six counties of the north and the 26 counties of the south in Ireland. 55% of Northern Irish voters voted to remain in the EU – the majority in Ulster does not support this bill. Politically too the landscape is changing, with growing nationalist power and a weakening of support for the Union of Great Britain and Northern Ireland. A hard border will accelerate that process. Many in Northern Ireland feel that the current UK Government have hung them out to dry through promoting English (as opposed to UK) nationalism. Those on the extreme political fringes may see a return to the terror of the 1970s-90s as the only way they can influence future change. 

Sputnik: The UK Government’s move followed stalled trade talks between the US and the UK. How much damage could this do to the UK as it is currently struggling to strike post-Brexit trade deals?

Mark Shanahan: There is an idealistic naivety to the current government’s position on global trade. It rides into talks seeing itself as a major global power – a strong, independent, trading nation. But the UK accounts for 1.8% of the world’s trade. In looking to deal with the US, it’s a relative minnow. Having a reputation for being a fair player and upholder of the rules-based international system has always stood it in good stead in the past. This bill puts that honest player status into question. Couple that with a second-term Trump administration focused on ‘America first’ or a Biden administration less attuned to socially-Darwinistic populism and the outlook for a favourable trade deal doesn’t look great. It will either be a deal asymmetrically beneficial to Trump’s America, or a place near the back of the queue for a Biden deal that likely won’t be any better. 

Sputnik: In your opinion, how can London and Washington come to an agreement overall? What would it take to reach a compromise?

Mark Shanahan: First of all, the UK cannot be seen to break International Law – so there will need to be domestic action first to reword the Internal Market Bill. Second, the UK negotiators are almost certainly hoping for a Biden win in November and a return to the norms of international trade negotiation. Trump has achieved some success through disruption, but his zero-sum, America-First agenda makes it hard for any nation or bloc to achieve a mutually beneficial compromise. A Democrat Executive and at least a Democrat House may be more favourable to a deal that might at least enhance the illusion of a special relationship (and there are real benefits for both sides of such a deal), but that won’t happen if the UK is regarded as unreliable in upholding its international treaty commitments.  

Sputnik: To what extent do the internal pre-election politics in the US play a role in the argument between the UK and the US, as current US President Donald Trump tends to speak highly about the UK PM while the backlash with regard to the Internal Market Bill was mostly seen from the Democrats?

Mark Shanahan: Trump needs visible successes before November – a chimaera Trade Deal might work to his advantage but it will be only headlines since a truly comprehensive deal will take years to negotiate and still has to be approved by Congress. But US elections are won on domestic politics. Anything happening in the UK is a sideshow – and possibly one the Democrats can get more mileage out of due to the large emotional attachment of so many Americans to Ireland. 

The views and opinions expressed in the article do not necessarily reflect those of Sputnik.

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