Brexit Delayed, Yet Hopes For A Deal Remain Alive; GBP/USD, GBP/JPY, EUR/GBP

The British parliament’s first weekend sitting in 37 years saw the Letwin amendment triggered, yet reports that the government may have the votes to secure a deal saw GBP evade weekend gaps.

 

This weekend the British Parliament held its first weekend sitting in 37 years to debate Boris Johnson’s Brexit deal. Cobbled together at the last minute, the new deal is essentially Theresa May’s Brexit deal with a revised protocol on Ireland and Northern Ireland and a few tweaks to the political declaration regarding the future EU-UK relationship. Critically, the contentious backstop has been replaced. The new proposal avoids a hard border across Ireland by keeping Northern Ireland aligned to EU single market rules and regulations while actually remaining part of the UK’s customs territory for at least four years. At the end of this period, the Northern Irish Assembly will vote on whether to remain aligned with the EU and the deal could be rolled over for another four or eight years.

Although this solution satisfied the EU, the DUP (Northern Ireland party) signaled early that it would not support the deal, costing Johnson a precious 10 votes. Given that Johnson now rules with a minority of 43, passing the deal through parliament was always likely to be an uphill struggle. Adding to the political drama was the pressure exerted by the looming deadline imposed by the Benn Act, designed to prevent a no-deal Brexit. If Johnson could not get parliamentary approval of his deal by 11 pm on Saturday, he would be forced to request an extension to the Brexit withdrawal date, currently set at 31st of October.

Given that Johnson has repeatedly insisted that the UK would leave the EU on the 31st of October “do or die”, a number of MPs began to suspect this could be achieved through political maneuvering designed to circumvent the Benn Act. They feared that hardline Brexiters could support the new Brexit deal on Saturday to meet the requirements of the Benn Act, but then vote against legislation to implement the deal - thereby forcing a no-deal exit on the 31st of October. This potential strategy was foiled by the tabling of Oliver Letwin’s amendment before the vote on Johnson’s Brexit deal. Acting as a cunning insurance policy, the Letwin amendment withholds approval of the Brexit deal until the legislation required to enact it (the Withdrawal Agreement Bill) has been passed. The Letwin amendment was passed by 322 to 306 votes with backing from the DUP providing 10 crucial votes to get it over the line. Roars of approval could be heard inside the commons from the estimated one million people outside marching for a second referendum on Brexit.

1 2 3
View single page >> |

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such ...

more
How did you like this article? Let us know so we can better customize your reading experience. Users' ratings are only visible to themselves.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.