Brexit in the time of pandemic
As far as rules go, most governments prefer not to have multiple sh*tstorms on the go at once, at least not if it can be avoided. For most politicians, managing a pandemic would be hard enough, let alone trying to do so whilst at the same time, say, ripping up your most lucrative trading arrangements.
Then again, Boris Johnson isn’t most politicians and his government isn’t most governments.
Having put the country through four years of post-EU referendum stress, the last thing any Conservative government wanted to do was delay their trip to the Brussels-free Holy Land. Especially Johnson, who campaigned, and won, on a pledge to ‘Get Brexit Done’. Ergo, Britain went ahead and pursued its exit negotiations at the same time every sinew in the muscle of government was managing the catastrophic impacts of the COVID-19 pandemic. And here Britain ‘succeeded’ in securing a deal, inasmuch as the government produced a thin stack of paper called an exit deal and handed it over to businesses at the equivalent of five minutes to midnight.
The resulting challenges at the border this January were, then, to be expected. Even after years of debate of what the post-EU trading relationship would look like, it’s true face was only revealed the moment before it happened. Even the biggest corporates didn’t have enough contingency plans in place to anticipate every last possible outcome.
In other words, it’s no surprise the early returns of Britain’s ‘freedom’ from the EU are quite horrific. Even with the anticipated slowdown due to the pandemic, trade volumes have been anemic, and the continuing uncertainty over the border arrangements with Northern Ireland are causing even some Brexit allies to pull out their hair. Exhibit A: Scottish langoustine exporters, who’ve seen their exports volume crater and compliance costs soar. The fish might be happier, per Jacob Rees-Mogg, but that doesn’t mean their human catchers are. And so it’s going for many other non-sea based exporters.
Which isn’t to suggest things won’t improve; there was always going to be an adjustment period. In a sense, we won’t get a good understanding of normal until the pandemic recedes and economic activity recovers. In the meantime, the government is making solid progress rolling over existing trade agreements. Less impressive results are being delivered, however, in opening up entirely new markets like the United States, i.e. the arrangements that were meant to fill the EU-shaped hole in Britain’s export accounts. Here, the change to the Biden administration looks set to make already tough UK-US negotiations even harder, particularly if Johnson continues with his Northern Irish jiggery-pokery.
The government’s saving grace is that we’ve all lost our bearings with normal. It is perhaps ironic that the last time life felt anything like normal in the United Kingdom just happens to coincide with the time Britain chose to reject normal and formally separate from the European Union in January 2020. Some cynics have even suggested the Johnson government plowed ahead with a hard Brexit because its impacts would be masked by the severe economic downturn imposed by Covid.
And if two sh*tstorms weren’t enough, the Conservatives might soon be adding a third with Scottish independence. Scottish Premier Nicola Sturgeon has (barely) survived the Alex Salmond inquiry and is now set to let her nationalists into battle on May 6. A stonking result will heap even more pressure on Johnson and his government. Thankfully, the latest polls are tipping back into solid Union territory, perhaps because Scots are waking up to the very real impacts of leaving a deeply ingrained economic union first hand.
Given the distinguishing characteristic of Boris Johnson appears to be luck, it might just all turn out alright. But even if it does, it’s going to take years to establish the new normal. Wish us well.
Subscribe to Trafalgar’s Under the Radar newsletters for the news you might have missed.