🔒 Will Brexit vote bring down UK govt? – The Wall Street Journal

DUBLIN – As the March deadline for the UK’s exit from the European Union rapidly approaches, UK PM Theresa May is facing her toughest challenge yet. Having finally negotiated a draft agreement with the EU, May must now get the vote approved by a sceptical Parliament. In a bid to drum up support, May has been reaching out to businesses in the UK, trying to sell the plan as the best available option. But even as her marketing efforts continue, concerns are growing about the fate of her government. Some lawmakers have indicated that they want to take a vote of no confidence in May. Such a move may trigger snap elections and potentially lose Tories control of Parliament. Many lawmakers within her party have said that they would prefer a hard Brexit (crashing out of the EU with no deal) to the deal on offer. The shape that Brexit takes will have serious implications for South Africa. The UK is a major South African trading partner and many South African goods that are sold more widely in Europe are landed in the UK. A hard Brexit would mean supply chain disruptions that would affect South African farmers, and the broader implications would also potentially hurt mining and minerals operations. To the extent that Brexit leads to slower growth in the UK and Europe, it will drag on South Africa’s already-weak growth. The fate of May’s Brexit plan will hit your wallet, one way or another. – Felicity Duncan

U.K.’s May Defends Brexit Plan to Businesses

By Max Colchester and Jason Douglas

(The Wall Street Journal) LONDON—British Prime Minister Theresa May Monday intensified a campaign to get businesses to back her Brexit agreement, trying to build momentum behind her much-maligned plan to extract the U.K. from the European Union.
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In a speech to the Confederation of British Industry, a leading business lobby group, Mrs. May stressed her argument that the deal will reduce the arrivals of other EU citizens in the U.K., in an effort to muster support for her plan with grass roots eurosceptics.

Several prominent businesses, fearful of the economic disruption caused by the U.K. falling out the EU without a deal, have already given their support to the deal. CBI Director-General Carolyn Fairbairn told the conference “The prime minister’s agreement is not perfect. It is a compromise. But it is hard-won progress.”

“I think it’s the best deal she could get. She’s not going to make everybody happy,” said Jonathan McManus, finance director of Flagship Housing, which rents and sells homes to low income families in the east of England.

The talk comes as uncertainty continues to swirl over whether there will be a vote of no confidence in the prime minister. A core of euroskeptics from her Conservative Party sought over the weekend to drum up support for their push to oust her. Forty-eight Conservative lawmakers must submit letters to a special committee to get that process under way.

But as of Monday only 25 lawmakers said they had sent the letters. Meanwhile, Mrs. May also was bolstered by the fact she suffered no more resignations from cabinet ministers over the weekend from her government, seeming to damp some of the impetus to oust her. Two members of her cabinet quit last week in protest at the deal she had struck.

Mrs. May is now trying to switch the focus of the debate away from the withdrawal agreement to quit the EU that was agreed last week and more toward the deal that is being completed this week to lay out aspirations for the U.K.’s future trading relations with the bloc.

In Brussels on Monday, EU chief negotiator Michel Barnier met with ministers from Britain’s 27 EU partners and said he had received their backing for the withdrawal agreement. EU leaders gather in the Belgian capital on Sunday to sign off the Brexit deal.

Mrs. May is emphasizing a carrot to those uncertain about her agreement, saying that it will deliver on controlling the U.K.’s borders.

“It will no longer be the case that EU nationals, regardless of the skills or experience they have to offer, can jump the queue ahead of engineers from Sydney or software developers from Delhi. Instead of a system based on where a person is from, we will have one that is built around the talents and skills a person has to offer,” Mrs. May told the CBI.

The main concern for many businesses is that Parliament won’t back the agreement, leaving a chaotic exit for the U.K. next March, and some have warned that reducing the U.K.’s access to the EU’s pool of workers will hurt them.

Roger Morgan-Grenville, director of Dexam, a supplier of crockery and kitchen tools based in Midhurst, England, said the deal may not do enough to give the U.K. flexibility to pursue global opportunities. “It lacks a vision and it lacks optimism,” he said.

Key, however, is getting British parliamentarians onside. Mrs. May will travel to Brussels this week ahead of a summit on Sunday where EU leaders are expected to rubber stamp the Brexit deal. Then the British Parliament will then have its say, with Mrs. May’s government hoping to have the process essentially wrapped up by the Christmas recess.

British lawmakers who are both for remaining in the EU and leaving the trading bloc have expressed skepticism over the deal, which sees the U.K. bound to EU oversight for an indefinite period after it leaves the trading bloc in March.

In this transition period, the U.K. will have to apply EU rules, while negotiating a new trade agreement with its European partners.

If the trade deal can’t be sealed by the end of 2020, the U.K. would either extend the transition period for some years or fall into a loose customs union with the EU from which it can only extract itself with the EU’s blessing.

On Sunday, Mr. Barnier suggested the maximum period for extending the transition should be two years, officials said, a position that most member states appeared comfortable with. Any extension of the transition would require continued British payments into the EU budget.

—Laurence Norman contributed to this article. 

Write to Max Colchester at [email protected] and Jason Douglas at [email protected]