According to reports from The Times and Bloomberg this morning, Theresa May is to announce the triggering of Article 50 at an EU Summit in Malta on March 9th. That will be three weeks before her self-imposed deadline of the end of March.
The Article 50 Bill, the legislation required for Parliament to enable the triggering of Article 50, is being debated for two days in the House of Commons for two days in what is called a Second Reading. The Lib Dems, the SNP and a handful of Labour rebels are expected to vote against it, however it is almost certain that the Bill will pass through the Commons.
The Government has said that it wants the Bill approved by the House of Lords by March 7th, in time for Mrs May to head to the summit a couple of days later to inform the EU gathering of the triggering of Article 50. Given the already low approval ratings of the House of Lords, they’re also unlikely to reject the Bill, or risk a snap General Election where the existence of their House will be called into question.
A drop in the value of Sterling is expected, with a steady recovery back to current levels.
For the world of business, including our very own sector, this is where the real work begins.
Speed will be of most importance
The two year negotiating period looks like it will begin on March 9th. Our leaving date will be set at March 9th 2019, give or take a few days. From here on in, it will all hands to the pumps to get as much done by the deadline.
It now looks as though there will be a transition period after the two year period is up. There are split opinions on the matter, but I think this is a better way to go about things, giving businesses both sides of the channel a chance to change their businesses to work better to the new system.
But time is now of the essence. And there are two prongs of attack for the UK. The first is to negotiate the best deal it can with the EU. The second will be for UK representatives to travel around the world to start “informal” talks with countries around the world to with the aim to set up new trade deals once we leave the EU officially. According to the rules, the UK cannot formally negotiate new trade deals on it’s own, it must be as part of the EU. However, we’re leaving, and they will know as well as we do that whether the talks are formal or informal, they are going to happen quietly whilst UK/EU negotiations take place.
Throughout this year though, I expect Brexit news to be fairly quiet, at least up to the Summer. There is a French General Election coming up in which the far right candidate Marine le Pen has a good chance of winning. If she does then it would be another political earthquake which would serve to weaken the EU futher. Then there is the German election not long after. Merkel is expected to win this one, however, if she were to lose and a far right candidate, or right-of-centre candidate were to win, the EU would look very shaky at this point.
Could be good for Sterling.
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