Why Theresa May's Salzburg humiliation increases the chance of a no-deal Brexit

This week was supposed to move the UK and EU closer towards a Brexit deal but ended with the prospect of no deal looking likelier than ever. What happened?
Theresa May bluntly dismissed Michel Barnier's Northern Ireland border proposals, irritating EU leaders before the summit had even started.
A Business Insider report that UK trade secretary Liam Fox was planning to water down EU regulations after Brexit caused outrage among EU leaders.
May reacted with a chest-beating speech, warning that the EU must show "respect" to the UK. Brussels reacted with a collective shrug.
The prospect of a no-deal Brexit is becoming likelier by the day.

LONDON — Thursday's Salzburg summit was billed as a chance for Theresa May to gather warm words of support about her Brexit plans from European counterparts. It ended in abject humiliation for the UK prime minister as a succession of EU leaders queued up to slam her proposals as unworkable and her approach as uncompromising.

And so a week that was supposed to move the UK and EU closer towards a deal ends with the prospect of no deal looking likelier than ever. What happened?

The EU's bid to bolster May's premiership actually began a day before the summit. European diplomats and leaders had, for weeks, been briefing that they would use the summit as an opportunity to provide words of support for the PM. Doing so, they reasoned, would help May bolster support for a deal with her political opponents — many of whom are in her own party — back home in Westminster.

Keen to address British concerns over the EU's "backstop" proposals for the Irish border, chief negotiator Michel Barnier suggested a "new, improved" proposal and made assurances that the EU had no intention of breaking up the UK.

The new backstop wouldn't, in reality, be very different in substance. But the EU's plan was instead to stretch warm words and goodwill as far as it could go to generate some good headlines.

But May had her own political calculation to make, with one eye on next week's Conservative conference where she will attempt to see off threats from hardline Brexiteers in her own party who have openly discussed the prospect of challenging her leadership.

May bluntly dismissed Barnier's backstop proposals irritating EU leaders before the summit had even started. It got worse from there. A Business Insider report that UK trade secretary Liam Fox was planning to water down EU regulations after Brexit caused outrage among EU27 leaders and intransigence on both sides of negotiations over the Irish border resulted in a day of discord and tension when it had been billed as one of co-operation and dealmaking.

Perhaps the most ominous sign for May came when Donald Tusk — who had previously welcomed her Chequers plans as a "positive evolution" — told reporters that her proposed new economic partnership with the EU "will not work."

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A summit which her advisers had long-strategised as a chance to move closer to a deal had ended in disaster.

Back home on Friday, May reacted with a chest-beating speech, warning that the EU must show "respect" to the UK in negotiations and suggesting she would "never" sign up to plans which risked the break up of the UK. She admitted, for the first time, that talks were at an "impasse".

Brussels reacted with a collective shrug. "What did she say that was new?" a source close to a senior EU official said.

What next?

The blunt truth is that the UK and EU have failed to come anywhere close to an agreement on Irish border issue, which remains the biggest sticking point in negotiations.

The EU's approach seems to have reached the end of the road. Barnier has spoken at length about "de-dramatising" the Irish backstop issue, which would essentially keep Northern Ireland within the EU single market and customs union.

But May has rejected all suggestions of a re-modelled backstop (an agreement which she signed up to in December) and the EU has rejected her own proposal, warning that it would threaten the integrity of the European single market.

"With just four weeks until a hoped-for final deal and with the issue of the Irish border still deadlocked, the chances of a no-deal Brexit in March have risen further over the past 48 hours," said James Stewart, KPMG's head of Brexit analysis. May's statement on Friday that talks had reached an “impasse” only underlines that danger.

While the UK and EU both maintain that a deal is the most likely outcome, neither side has any intention of fundamentally shifting their current position on the Irish border. Too much is at stake. In that context, the prospect of a no-deal Brexit is becoming likelier by the day.

Why Theresa May's Salzburg humiliation increases the chance of a no-deal Brexit

What next?

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