Brexit: Transition deal talk picks up, but still lots of other divorce details to agree first - ING
|"The UK government initially wanted the divorce and new agreement to be finalised within the two year window for Brexit with a short “implementation period” added on to allow the country to adjust to the new environment", explains James Knightley, Chief International Economist at ING.
Key quotes:
"However, it has become clear to the British government this was too short a timescale with acceptance of a full blown “transitional period” now widespread amongst ministers. Chancellor Philip Hammond wants a “long” transition to protect the UK’s economy, and even arch-Brexiteers such as Liam Fox are now acknowledging the need. That said, he feels it must end before the next scheduled election in 2022 to prevent Brexit being reversed."
"However, there will be no agreement with the EU on transition until the broad framework for the divorce, including the exit fee, citizens rights and land border issues with Ireland are resolved. This is unlikely to happen until 4Q17 at the earliest, which will leave corporates sitting nervously waiting for news."
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