May the new period that started with President Recep Tayyip Erdoğan’s oath and the announcement of the cabinet following the ceremony in Parliament be beneficial for our nation. In this context, within the framework of the fresh mechanism introduced by the presidential system, efforts to effectively combat the problems of our economy and initiate a new transformation will be a priority agenda item that contains continuity. As Turkey welcomes a new period in this sense, the political developments of the outside world with economic content are continuing nonstop. I discussed trade wars and the oil issue in my recent articles as matters that need to be watched closely, however the waters are no calmer in the Brexit issue - another ongoing matter that closely concerns our region.
As you know, there are only months left for the United Kingdom to leave the EU. The day of separation is going to be actualized in March 2019. Hence, there is no doubt that the remaining time in the Brexit process – in which no satisfying progress has been made – two years after the people’s surprising decision, needs to be utilized in the best way possible. The U.K. cabinet who gathered at Chequers on July 6 for this purpose, announcing certain decisions on its new relation vision with the EU, initially created the “better than nothing” atmosphere.
Accordingly, while the decisions in question, which are part of a light Brexit prescription, try to contain a more comprehensive suggestion package for the future of economic partnership, it has placed a “free trade zone” for the buying/selling of goods for both sides. This means that maximum compliance with EU rules is necessary in relation to the products, as well as attaching great importance to the European Court of Justice in ruling. Based on this, it can be said that organic ties with Brussels will somehow continue with the Single Market in Customs Union practices. While the aim through this is to protect goods trade relations and related economic dynamics, it is also believed that the problem of “drawing a border between two Irelands” – a key issue for Brexit – may be overcome.
Meanwhile, according to the Chequers decisions, the era of making generous payments to the EU budget ends while the free movement of people is also eliminated. In addition to this, while the document released details the goods part, it also signals that there will be no common area of movement in the services sector. This means that service integration, primarily in finance, will be interrupted between the U.K. and EU. Thus, it seems that the service trade, which has “extreme” importance for the U.K., is going to blur the economic outlook in the new picture.
As is understood, while effort is made in this light Brexit prescription to please both the separatist wing and the EU at minimum level, care is taken to prevent a tremor in balances concerning the country’s future. Yet, frankly, it is quite difficult to drive all these dynamics without any fractures. Thus, the Chequers decision was quickly followed by the news of a tremor from London. As is known, Brexit secretary David Davis, who resigned, showed that there actually is no consensus on the decisions which the government said there was consensus, and that the result is not a pleasing one for those in favor of Brexit. Because the outline drawn for the trade of goods signifies a window open to concessions.
While the resignation that left U.K. Prime Minister Theresa May in a tight position – even though Dominic Raab’s appointment was made immediately– gave rise to new question marks regarding how business will progress in London. Brussels interprets the point reached as the fleeing of the pro-Brexit side from the field. As a result, experience has demonstrated how difficult it is to actualize the harsh claims that formed the grounds of the decision to leave the EU. Furthermore, it is not possible at this point to say there is any clarity regarding what Brussels will say to the Chequers package. While it is impossible to imagine exactly how the atmosphere in which free movement is going to be implemented, it is unknown whether the Ireland issue can be solved as easy as the cabinet portrays.
As a result, like I mentioned before, making a choice (or making choices) between economic interests and freedom is a challenging struggle for the U.K. A smooth Brexit transition requires solving the serious rigidity on both sides.
