Sorry Boris, the EU will respond to new ideas, not to a no-deal threat

With important debates on the horizon, from reforming the eurozone to tackling the refugee crisis, EU leaders are cautious not to set a precedent over Brexit

One hundred and thirteen days to go until Brexit and there is still no agreement in sight.

Both Boris Johnson and Jeremy Hunt, the two candidates vying for the position of prime minister, have pledged to go back to Brussels to secure a new deal. Both have said that, if the EU refuses to engage, the UK should not be afraid to walk away in October with no deal. Their bet is that the threat of a no-deal Brexit would force the EU27 to reconsider. But are they right?

Yes and no. Threatening no deal will not change the EU’s mind – but if the new prime minister can persuade EU leaders that renegotiating is better than no deal, then there may be some wriggle room.

Simply threatening to crash out of the union in October won’t work as a negotiating tactic because the EU27 already feel sufficiently prepared for a no deal. The European Commission first began publishing no deal advice in the spring of 2018. EU officials have since held seminars with European business to help them plan for this outcome, and most EU governments have launched campaigns to raise awareness of any issues it might raise. The EU27 have also agreed a series of temporary and unilateral measures to manage some of the impact, covering everything from financial services to flights.

In June, the EU Commission confirmed that these measures would still be valid if the UK left with no deal at the end of October. Funding for those countries most affected by a no deal has also been set aside by the EU.

This work has created a perception that the EU27 are ready to face any Brexit outcome, even while some important questions remain. Just this week, the Irish foreign minister Simon Coveney made clear that a no-deal Brexit presented significant risks for the Irish border and they have yet to make clear how they intend to manage the disruption.

Another reason that a hard line threat won’t achieve very much is that EU businesses have done very little to pressurise EU27 governments to change tack – even in those countries that are major UK trading partners and have the most to lose, such as Germany, the Netherlands, France, Belgium, Italy, Spain and Poland.

There are several reasons for this. Some in the EU see commercial advantages of a no deal: businesses could relocate to mainland Europe or Ireland and continue to access the single market, bringing jobs and other opportunities with them. France has been particularly keen to attract financial firms currently based in London.

But other businesses are worried that any revised agreement would give UK companies an unfair competitive advantage because they would retain access to the single market without facing the same level of EU obligations. This could set a precedent where businesses from other third countries – Japan, South Korea and even the US – ask for similar, or at least more favourable, terms of access. For many EU businesses, unpicking the single market would present a higher cost than meeting the UK half way to prevent a no deal.

Finally, there are people in the EU who think a no deal is a totally empty threat. Reports of British businesses falling behind on their no deal planning, along with MPs trying to stop it from happening, have led many to believe no deal is off the table already. Meanwhile, many EU27 leaders think a no deal would be so chaotic that the UK would be back at the negotiating table within a few weeks of it happening.

While the EU27 have ruled out any renegotiation, they might be open to further talks. But if a new prime minister is serious about reaching a new or revised agreement, he will need to put forward credible and workable alternatives, convince the EU that he can get a revised deal through Parliament and also demonstrate how a revised agreement is in the EU’s interest.

From the EU’s perspective, any move must benefit both sides; the last thing they want is to row back on their negotiating red lines to suit the UK, as this might encourage anti-EU politicians in their own countries to use similar tactics to get the EU to change position in other areas.

With important debates on the horizon – from reforming the eurozone to tackling the refugee crisis – EU leaders will be cautious not to set a Brexit precedent.

The threat of a no deal is not new; screaming louder will not make the EU change tack. Only sensible solutions will change their minds. The new PM has a chance to at least persuade the EU that this is a better route than no deal.

But, like all aspects of Brexit, one question remains: will there be enough time to do it?

Georgina Wright is a senior researcher at the Institute for Government