Wednesday

25th Apr 2018

Berlin to London: Don't expect special treatment

Ask a British Brexiteer in the Westminster bubble if they are pessimistic about the slow progress made in the first three rounds of Brexit talks and the bitter rhetoric on both sides, and they will cite a saviour in Berlin who will restore order as soon as she is re-elected on 24 September.

'Angela Merkel wants a deal because German industry wants to keep selling BMWs and Audis,' or a similar version, is what you can expect to hear.

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Opinion polls suggest that Merkel's Christian Democrat Union (CDU) will win another decisive victory in the upcoming Bundestag elections. The CDU has built a solid 10-15 point poll lead that was not dented by Merkel's performance against her SPD challenger, former European Parliament President, Martin Schulz in the leaders' TV debate on 3 September.

"The main question now is who Merkel forms a coalition with," says a confident CDU politician on the campaign trail.

Theresa May's ministers will probably hope that Schulz, who spent over 22 years in the European Parliament, is not part of another Grand Coalition.

But politicians and analysts across the German political spectrum are united on one point: Germany's position on Brexit will not change after 24 September regardless of who Merkel decides to govern with.

"The reality is that the main parties are all pro-European, and believe that Germany should stick to the line that life outside the EU should not be as good as inside," says Carsten Brzeski, chief economist in Frankfurt for the Benulux bank ING.

Contrary to the hopes of some in London, meanwhile, senior members of Chancellor Merkel's party insist that her government will not break from the European Commission's negotiating line.

"Merkel has so much on her plate already. She doesn't want to get involved in a fight on Brexit," one senior CDU politician tells EUobserver.

"Every day German civil servants tell their counterparts this but they are still not listening," he adds.

Compromise between friends

Alexander Graf Lambsdorff is hoping to swap his seat in the European Parliament for one in the Bundestag for the liberal Free Democrat Party (FDP) after September 24. He says that Germany's Brexit policy won't change should the FDP join a Merkel-led coalition after the elections.

"I think it would be an overstatement to say that there would be a fundamental shift in the position," he told EUobserver.

Some ideas from Berlin about the exit bill "went a bit too far, and we [the FPD] said so," he admitted. "We felt that the Commission was right there and the German government went a bit too far".

Graf Lambsdorff says that a compromise between friends is the optimal result from the Article 50 process.

"Britain at the end of the day will still be a Nato ally, it will still be a trading partner, it will still be one of the favourite destinations for people to go to and spend their vacation, Britain will remain a friend and to us and not-to-forget is the motherland of liberalism."

"We want to minimise the negative economic fall-out and in order to achieve that there needs to be a negotiated trade arrangement at the end of the process that will allow both sides to limit the damage to the absolute necessary minimum," he says.

Election will change nothing

With Brexit still the dominant political topic in London, the assumption is that the divorce is exorcising the rest of Europe. German newspapers tell a different story. There has been little coverage of the issue which was barely mentioned during the leaders' TV debate.

"I have many British colleagues that believe Brexit is a big issue in the German elections, but believe me, it isn't," says the CDU source.

Nor has the lack of progress in the first three rounds of talks escaped Berlin's notice.

"We have a saying that sense should rain from the sky. The hope is that May will announce something more sensible in October after the conference season," he says.

"For the moment, we're not making substantial progress and I don't see how the European Council will agree to move in October."

Led by the Parliament's chief Brexit negotiator, Guy Verhofstadt, MEPs are expected to vote on their own resolution ahead of the October European Council, and sources in the Parliament suggest that it is unlikely to endorse opening talks on a post-Brexit trade deal with the UK.

The message appears to be clear: if Theresa May's ministers are banking on special treatment from Germany they are likely to be disappointed.

"Merkel will stick to the Commission's line but would try to find a face saving compromise," warns Brzeski. "She will be strict on the substance.

"The UK has decided to move out of the club and either you accept EU rules or you don't have access to the single market,' concludes Brzeski. "On Brexit the election will change nothing".

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The EU Withdrawal Bill passed by 326 votes to 290 in the House of Commons, but Conservative MPs warned that controversial plans for the government to overturn EU laws by executive order would have to be scrapped.

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The relocation of the EMA and the EBA after Brexit will leave a hole that will need to be filled, but opinion is divided among local business people as to whether the agencies will be missed.

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