Agreement on NI Protocol could be reached within a month due to UK's economic issues, say EU sources

Thu 29 Sept 2022
Posted by: Richard Cree
Trade News

Northern Ireland Protocol EU UK Negotiations

The EU is expecting a quicker-than-expected settlement to the deadlock over the Northern Ireland Protocol because of the UK’s current financial troubles.

Several media outlets are reporting that sources within the EU think the UK will be more open to negotiate with Brussels over Northern Ireland to allow the government to focus on domestic issues.

Troubled Britain

The Telegraph claims "Brussels believes a deal could be struck within a month because of economic troubles in Britain”, while the Daily Express reports that Maros Sefcovic, the bloc's Brexit negotiator, is hoping economic turmoil will push Liz Truss into a compromise in the long-running row to allow her to focus on the domestic front.

A call is scheduled between Sefcovic and the UK foreign secretary, James Cleverly, tomorrow (Friday 30 September). 

Meanwhile, the EU’s former chief Brexit negotiator, Michel Barnier has warned that if the Truss government goes too far with its deregulatory agenda and breaks provisions within the UK-EU Trade and Cooperation Agreement maintaining a level playing field between the UK and EU, the EU may impose tariffs.

Hard to contain the Schadenfreude

There is general bewilderment in finance ministries across Europe at events in London this week, according to the Financial Times.

While German finance minister Christian Lindner said, “In the UK, a major experiment is starting as the state simultaneously puts its foot on the gas while the central bank steps on the brakes”

“We must not counteract the central bank’s policy of rising interest rates by sending fiscal stimulus for demand or for growth” he added.