Daily Archives: June 13, 2020

On 7 October last year, there was a defining phone call between Boris Johnson and Angel Merkel.

It had been a turbulent week. The EU had rejected Johnson's plan for a hi-tech customs border on the island of Ireland.A no-deal exit was just over three weeks away.Donald Tusk, President of the European Council, accused Johnson of engaging in a "stupid blame game".

But it was how a Downing Street source had characterised the phone call that sent the political temperature soaring.

The source had told journalists: "Merkel said that if Germany wanted to leave theEUthey could do it no problem, but the UK cannot leave without leaving Northern Ireland behind in a customs union and in full alignment forever."

Blood was boiling. The DUP leader Arlene Foster accused the EU and Dublin of wanting to "trap" Northern Ireland. Officials in Brussels and Berlin questioned whether the notoriously circumspect Merkel would have used such language. A Downing Street source suggested a deal was now "essentially impossible, not just now but ever".

However, senior sources close to developments that week say Merkels interventionwaspivotal. Ireland, the European Commission, and other member states had been insisting Johnsons plan - a blend of customs processing centres near the Irish border, streamlined by technology and derogations from EU law - was not acceptable. Now the German Chancellor was telling Johnson directly it would not work.

"It has a different type of weight when it comes from Merkel," says one key source. "It played a role, definitely."

The role it played was to force Johnson to abandon his Irish border plan. Three days later he met the Taoiseach Leo Varadkar at Thornton Manor near Liverpool. To considerable surprise, they emerged after 90 minutes proclaiming a "pathway" to an agreement.

Gone was any suggestion of checks or controls on the Irish border. Northern Ireland would remain in the UKs customs territory, but apply EU customs and regulatory formalities. Stormont would vote on the arrangements every four years, but there would be no unionist veto.

That was how the deal ended up. Officials had to hammer out the details in time for an EU summit on 17 October, with the agreement only getting over the line as EU leaders were arriving in Brussels.

However, very few changes were required of the existing Withdrawal Agreement, which the House of Commons had rejected on four occasions.

"It looks pretty much like the deal of last November [2018]." says one source. In the final deal the UK-wide customs union was removed, as was any reference to how the future relationship would make the backstop fall away.

Officials then inserted paragraphs to facilitate the Stormont consent clause, to create a rebate system for tariffs on goods coming from Great Britain, and to provide for EU state aid rules continuing to apply in Northern Ireland.

Why is this significant now?

It is instructive of what can happen when one negotiating partner is on the back foot and things are down to the wire.

Now we are confronting a deadline of 31 December to agree the EU-UK future relationship. The final frenetic days of the Withdrawal Agreement suggest it is difficult to start changing texts wholesale at the last minute.

"They learned from the last occasion that they shouldn't go down to the wire," says one senior EU source.

Another source close to the negotiations says: "The UK will be worried if they leave it too long, that time pressure will be mostly on their shoulders. It will be the same as the Withdrawal Agreement. The longer you leave it, the less time there will be to change texts. Then you just have to go off-the-shelf."

British sources dismiss any suggestion that London wants to avoid a repeat of last Octoberper se, pointing out that getting an agreement sooner rather than later is in everyones interest.

Either way, as the fourth negotiating round drew to a close last week it was clear both sides were far apart on the big issues, and even on smaller ones.

Just like in the closing stage of the divorce negotiations, a "tunnel" is now beckoning, an intense period of negotiations with no media briefings and no briefings either of member states or the British cabinet.

But when the tunnel will be is itself the subject of division.London has been pushing for July.

On Tuesday, Cabinet Office minister Penny Mordaunt told the House of Commons: "There is no point in us arriving at an agreement at the 11th hour. We have to arrive at agreement to enable it to be implemented, ratified but also for our citizens and businesses to prepare. That is what is dictating the timetable here and that is why we must have renewed focus."

However, on Wednesday, Michel Barnier told EU ambassadors July was out of the question.

"Barnier is firmly of the view that that sort of approach can't happen until theres some sign of movement on the key issues," says one EU diplomat. "You cant go into it in the current situation where theres really been no movement. It was firmly: no, were not going to do it in July."

Barnier did offer to change the format. "You would still have negotiating 'table rounds," says the diplomat. "But hes talking about smaller negotiating teams, meetings happening intercessionally, small technical working groups. Hes put all these ideas to the British and he wants to continue into the summer."

On Thursday, both sides duly reached agreement on a new format. "There will be talks each week of the five weeks between the week commencing 29 June and the week commencing 27 July," a UK spokesperson said.

But this does not mean a tunnel. Diplomats and EU officials say London has been lobbying hard in national capitals for a July tunnel and for member states to relax the negotiating mandate they have given Barnier.

"There is a very strong push to accelerate things in July, and that the autumn will be too late," says one diplomat. "[UK officials] have been saying this in [EU] capitals as well. There is an element that they dont want to be backed into a corner, to mix metaphors, at a cliff edge, when everything is last minute."

The rejection of a July tunnel is not a solo run by Barnier. German officials have made it clear that when Berlin takes over the rotating EU presidency on 1 July their first priority will be the seven-year EU budget, known as the MFF (Multiannual Financial Framework), and the coronavirus recovery plan.

"There is an entrenched view in the EU now that the MFF comes first and Brexit second. Nobody is willing to engage in a detailed discussion, or a review of the negotiating mandate, now. That's all being looked at in September/October," says the diplomat.

Critics will say the EU can run down the clock until the autumn in order to keep the pressure on London.

However, officials in Brussels point out that Michel Barnier must bring member states and the European Parliament along at every stage.

"The only way to be able to evolve and refine positions," says one EU official, "and to engage in concessions, is to have full trust between the member states, the Commission and the European Parliament. So an early tunnel is way too premature."

Member states are, if anything, more dogmatic about the process than Mr Barnier.

"The structure reflects the fact that we want to control what the commission does [in the negotiations]," says a diplomat from a large member state.

"Not because we dont trust them, but because thats how the EU works. The EU is, yes, a bureaucratic construction but its very much also a democratic construction. And the fact that we take time is because there are democratic controls at every level. It makes it slow but it gives us [the member states] a sense of ownership."

As for the substance of what is holding up the negotiations, the difficult areas are well known: the level playing field, fisheries, police and judicial cooperation and how disputes can be resolved by both sides in the future (known as the "governance" issue).

The rhetorical back and forth on the level playing field boils the issue down to the following: the EU wants to make sure Britain follows EU regulations so that a large industrial power on its doorstep does not undercut European firms.

The UK says this is an intolerable breach of its new-found sovereignty and that the EU does not ask the same of third countries with whom it has recently concluded free trade agreements (FTAs), namely Japan, Canada and South Korea.

The issues are more complex than that, of course.

The EU says the UK must abide by the commitments made by both sides in the Political Declaration, the non-binding blueprint for the future relationship which accompanied the Withdrawal Agreement.

It commits both sides to "robust commitments to ensure a level playing field" to ensure fair competition between both sides and to "prevent distortions of trade and unfair competitive advantages".

Both parties, the document says, "should uphold the common high standards" which will apply on the date the transition period ends in the areas of state aid, competition, social and employment standards, environment, climate change and taxation.

The UK argues that the Political Declaration is a "framework" for the final treaty, and that not everything in it needs to end up in the treaty. Officials repeatedly say the UK is committed to the "vision" of the Political Declaration.

When it comes to what the EU is pushing for precisely on the level playing field, the formal negotiating mandate granted to Michel Barnier by national capitals provides some room for manoeuvre.

It states: "The envisaged agreement should uphold common high standards, and corresponding high standards over time."

Officials say this is not a demand that on everything the UK has to follow EU rules. It talks of "common" and "corresponding" high standards, with EU standards merely as a "reference point".

Both sides would sign up to so-called non-regression clauses, committing the parties not to lower the standards that they share right up to the point of the transition ending on 1 January.

"We also see the possibility of deciding together to increase that high level," says one EU official. "So in 2023, the parties could agree together to put a new floor, for example, in their commitments to the environment and climate change."

The mandate is tougher on state aid rules, however. The EU is determined that a future UK government cannot rig the system by bailing out uncompetitive companies.

The EU negotiating mandate states the treaty should "ensure the application of [European] Union State aid rules to and in the United Kingdom" with the UK setting up an independent authority to make sure EU state aid rules are applied.

The UK sees this as asking Britain to harmonise its laws with the EU over time.

It would, chief negotiator David Frost wrote to his counterpart Michel Barnier: "require the UK simply to accept EU state aid rules; would enable the EU, and only the EU, to put tariffs on trade with the UK if we breached those rules; and would require us to accept an enforcement mechanism which gives a specific role to the European Court of Justice. You must see that this is simply not a provision any democratic country could sign".

Following the last round of negotiations, Michel Barnier hinted at a more flexible approach, talking about an "appropriate" way of dealing with state aid and the level playing field: "We need to work together," he told reporters, "in order to come up with the appropriate toolbox, the robust commitments. What we care about is how effective these mechanisms can be so they ensure long term, fair sustainable competition between the EU and UK. But we're not there yet."

EU officials have not spelt out what this "toolbox" involves. British officials say they are "keen" to hear more and believe that the EU has now accepted that the hostility to following state EU aid rules is a principled position and not a negotiating tactic.

As is so often the case in the tortured relationship between the EU and UK, both sides want fundamentally different things.

Member states believe that a mutual promise not to lower environmental, labour, social, taxation and climate change standards is one thing. Committing not to intervene in your economy is another. The UK, on the other hand, sees everything through a lens of sovereignty and insists that international standards on a host of issues, including state aid, that both sides sign up to will be sufficiently robust.

EU officials say that by its very nature competition and state aid law is constantly evolving, and, as the Covid-19 pandemic has graphically illustrated, subject to sudden changes in gear (the EU has largely suspended its state aid rules during the emergency).

"State aid has always been about coordinating and synchronising approaches," says one EU source. "Over time its got to be dynamic. It cant be static. You cant be using state aid rules from 15 years ago. Some of the economic actors might not exist, some of the sectors might not exist. So its got a logic and dynamic of its own."

EU officials say member states understand the sovereignty concerns of the UK over state aid.

"It's not that were dogmatic on dynamic alignment," says one official. "We want something that stands the test of time, that works for specific sectors and that at the same time preserves our strategic autonomy. Obviously its fair enough for the UK to want to keep its strategic autonomy. The question is, what kind of Venn diagram has sufficient overlap so that you can find a landing zone."

Where there appears less scope for compromise is on granting the UK access to the single market in areas where it has a built-in advantage.

During a speech this week, Michel Barnier claimed the UK had been able, during its membership of the EU, to establish a commanding presence in granting certifications to third country firms so they could access the single market. He asked: "Is it in the EUs interests in the UK to retain such a prominent position? Do we really want to consolidate the UKs position as a certification hub in the EU, knowing that it already controls 15-20% of the EUs certification market?"

Addressing EU ambassadors this week, Barnier also focused on a UK demand for what is called "diagonal cumulation".

In simple terms, this would allow the UK to source component parts from around the world from countries that have a free trade agreement with the EU and then to assemble those parts into products that would be sold into the EU as "British".

To British complaints that this is intransigence, the EUs chief negotiator perceives pure self-interest on the UK side.

"There are tens of thousands of jobs behind this," says one EU diplomat. "Its a threat to the EU and hes determined to resist this."

London argues that the EU already embraces diagonal cumulation in other FTAs and other international fora. Sources suggest such an arrangement would work for both sides when it comes to the manufacture of electric vehicles, since the batteries they use are often made in countries with which both sides will have FTAs.

"The UKs rules of origin proposals are appropriate and modern," says a UK official. "They are based on substantial dialogue with UK and EU industry on their needs, and would facilitate legitimate trade under the FTA without circumventing the payment of tariffs. Cumulation already features in many of the EUs FTAs, such as its agreement with Singapore."

Both teams have now left the pitch after a goalless, bad-tempered first half. Very few observers believe Mondays High Level Conference, bringing together Boris Johnson and the heads of the three main EU institutions, will yield any great breakthrough.

Will the second half be different?

Michel Barnier made it clear that the EU can shift if the UK comes back to the letter of the Political Declaration. "We can find the necessary compromises on the condition that the UK changes its approach and accepts a proper balance of rights, benefits, obligations and legally binding constraints based on the respect of the agreed Political Declaration of last October," he said in a speech in Brussels this week.

While Barniers offer of compromise is linked to a return by London to the commitments of the Political Declaration, it seems clear that such a shift will not come in July or August. With the EU grappling with the devastation of the coronavirus pandemic, no-one is in the mood to start opening up the single market willy-nilly to a competitor.

"On the level playing field," says one diplomat, "I dont see a desire among any of the member states to give the UK a free highway into the single market without commitments."

Furthermore, Londons dogged rejection of an extension to the transition period has left member states highly unsympathetic to any desperate pleas to speed things up.

However, the diplomat adds: "Nobody wants the UK not to thrive economically. This is not what were interested in. Its an important market for us. But it cannot thrive at our expense.

"There is significant distance on a few major issues, but I dont think we are too far apart on others. These are the logical consequences of proximity, the interconnection, and the fact that the UK does not want to burn bridges in the areas they are interested in."

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Brexit: No light ahead of the tunnel - RTE.ie

More than half of Britons now support an extension to the Brexit transition period this year with this rising to two-thirds of people when potential shortages of medical supplies are factored in.

New research by the Health Foundation and Ipsos Mori suggests the coronavirus outbreak has reshaped views of the EU and Britains link with the continent with a clear majority of the public supporting closer working with the EU to tackle the virus.

As part of a wider survey of peoples experiences during the outbreak, 77 per cent said the UK should work very closely with the EU on Covid-19 responses with another 17 per cent saying it should work fairly closely with the EU.

Sharing the full story, not just the headlines

The UK and EU are currently in negotiations over the longer term relationship after the Brexit transition period which is due to end on 31 December.

The latest round of negotiations have stalled, with the UKs chief negotiator David Frost saying the two sides had come close to reaching the limits of what we can achieve.

Prime minister Boris Johnson is to hold talks with EU officials next week to try and break the deadlock.

Of those surveyed by Ipsos Mori, almost all of those who voted Remain in the EU Referendum (99 per cent) supported working closely with the EU to combat the pandemic, and over nine in 10 (91per cent) of those who voted Leave also supported closer collaboration.

Using two sample groups Ipsos Mori found 54 per cent of people said the government should request a Brexit extension beyond 31 December.

A second group were given information that was in line with government estimates about potential delays to the supply of medicines and medical devices in the event of a no-deal. In total 65 per cent, two thirds, believed there should be an extension, 31 per cent said no.

Young people, aged 18 to 24, were far more likely to support an extension.

No hype, just the advice and analysis you need

The Health Foundation warned a no-deal Brexit later this year would damage health and social care services.

Jennifer Dixon, chief executive, said: Covid-19 has put the government, the economy, the NHS and social care under intense pressure.

This winter a no-deal Brexit could exacerbate already acute shortages in the NHS and social care workforce and create new avoidable shortages of medicines and vital supplies. This would come at the same time as the health service is facing significant pressures from seasonal flu, supporting people recovering from Covid-19, tackling the large backlog of patients who didnt receive care during lockdown, and potentially coping with another wave of infection from the coronavirus.

This would be a vicious, and avoidable, combination of risks.

She added: The public understandably prefer protection from risks that can be anticipated and avoided. This research suggests the public clearly prioritise the management of the coronavirus pandemic, and collaboration with the EU.

The survey also found four-fifths of Remain voters backed an extension to the transition while 66 per cent of Leave voters opposed an extension. Almost 40 per cent of Leave voters backed an extension once informed of the implications of a no deal scenario.The survey was conducted by using a representative sample of people aged 18 and over between 1 and 10 May 2020.

A total of 1,983 people were interviewed with quotas set on age, gender, region and working status and data weighted to be representative of the population.

Originally posted here:

Majority of Britons back Brexit extension to help beat coronavirus - The Independent

Business leaders have pleaded with the government not to walk away from Brexit talks without a deal after Michael Gove claimed the Confederation of British Industry supported no extension to the transition period.

The CBIs director general, Carolyn Fairbairn, said to crash out without a deal would be a major block to recovery.

Walking away, she said would worsen inequalities and end up damaging regional and national growth.

Her comments come after Gove told the House of Commons that the CBI was now backing the government position not to seek an extension to the transition period at the end of the year.

I know that businesses want uncertainty to be removed. Thats why were clear that we will end the transition period on the 31 December, and it is a position that I also understand now the CBI is in favour of, said Gove, who is charged with implementing the Brexit withdrawal agreement reached in January.

Fairbairn, whose relations with the government were severely tested over Brexit last year, declined to respond to Gove directly.

But she made it plain that British firms were too busy struggling for their survival and the prospect of going into January next year with a new trading environment with possible tariffs and customs paperwork to export and import to and from the EU was the last thing on their minds.

Walking away with no deal would be a major block to recovery, she told the BBC in an interview.

Many businesses are not and cannot prepare for the impact of a no deal on top of what is happening.

The government has ruled out an extension business have no choice but to plan on that basis.

In a separate statement she added: Many businesses are fighting to survive as the impact of Covid-19 unfolds. A recovery plan that reaches all parts of the UK is essential. Every opportunity for growth must be seized, particularly to support young people and kickstart demand. A good deal with the EU would be a foundation stone of renewal.

The end of the transition period in December will complete Britains exit from the EU, bringing with it a departure from the customs union and the single market. That could mean dramatic changes for businesses, with customs declarations and, potentially, tariffs and other barriers such as border health checks on animals and food.

It will also bring an end to the the freedom of British citizens to automatically reside and work in EU member states.

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No-deal Brexit would be 'major block' to UK's recovery, warns CBI - The Guardian

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PUBLISHED: 17:08 12 June 2020 | UPDATED: 18:25 12 June 2020

Adrian Zorzut

Brexiteer Mark Francois told the BBC the EU would 'blink again' and concede to British trade demands; Twitter

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Francois told the BBC News Channel he felt the EU would concede ground on contentious negotiating points such as the level playing field and fisheries as long as the UK remain committed to ending talks by December 31.

The government has formally given notice to the bloc of its intentions not to seek an extension to the Brexit transition period. There are also reports Downing Street will relax border checks on EU goods from January 1 over fears of the economic impacts of coronavirus.

Commenting on the governments decision, the European Research Group chair said: The government has made it absolutely plain that there will be no extension of the transition period and therefore we got until the end of December to come up with an agreement.

I believe we can do that because we managed to get them to change the Withdrawal Agreement and drop the backstop in three months... even though Michel Barnier swore blind he would not do any of those things.

He added: They [the EU] blinked once and I believe if we hold our nerve, they will blink again.

When pressed on whether businesses should be given more time to prepare, the Tory MP responded: Weve got plenty of time. What we need is political will.

Twitter users could not have been less supportive of the dangerous game Francois was suggesting his Tory colleagues play, as his name started to trend.

Trade unionist Clare Hepworth said: Give me strength! Mark Francois #bbcnews refusing to contemplate an extension of the transition period & invokes the Tory manifesto pledge!

I think hes suffering political amnesia or thinks viewers are dumb. That was BEFORE the pandemic struck & reduced our economy by a third!

David Head reminded users of concessions Boris Johnson to get the Withdrawal Agreement. He tweeted: It was Boris Johnson who blinked first the last time around, over that border in the Irish Sea. Francois memory is seriously defective.

Twitter user @cabinetofclowns added: It was the Vote Leave administration who blinked and accepted the importation of chlorinated chicken from Trumps US, after explicitly stating many times, that our high standards in animal welfare would not be compromised.

The New Europeans editor-at-large Alastair Campbell agreed. Blinked? What planet are these people on? @BorisJohnson caved to get a deal. Now he says he doesnt like the deal he agreed to.

Another wrote: Mark Francois has got to be the best advert for Scottish independence the SNP could possibly ask for.

Almost four years after its creation The New European goes from strength to strength across print and online, offering a pro-European perspective on Brexit and reporting on the political response to the coronavirus outbreak, climate change and international politics. But we can only rebalance the right wing extremes of much of the UK national press with your support. If you value what we are doing, you can help us by making a contribution to the cost of our journalism.

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WATCH: Tory Brexiteer baffles news viewers by claiming EU will 'blink again' over government's Brexit position - The New European

TheConservative MP for Great Grimsby Lia Nicitold Express.co.uk thatthe major countries in the European Union such as Germany and France must understand that other nations within the trading bloc want to be more involved. Ms Nici added that many European countries will be looking at how Brexit works for the United Kingdom.

The Conservative MP said: "I think if the EU is going to survive the major countries like Germany and France need to understand that other countries want to be more involved and they want to be equal partners.

"That is really what us leaving the EU is all about.

"You dont stay a member of a club when the club doesnt work for you anymore.

"We know that there will be many countries across Europe that will be looking to see how Brexit works for us.

READ MORE:Brexit bombshell: Chance of no deal 'higher than ever'

"I wouldnt be surprised if we werent the only country to make the choice we have done in the future."

During the same interview with Express.co.uk Ms Lici told Michel Barnierto "wind his neck in" and get on with sensible negotiations over a post-Brexit trade deal.

TheConservative MP stated thatMr Barnier is full of bluster and threats regarding Britain's fishing waters.

Ms Nici also warned the EU's chief Brexit negotiator that the UK holds the cards during the trade talks.

The Conservative MP said: "Mr Barnier is full of bluster and threats.

"We have the cards, we are a sovereign nation and we have our fishing waters.

"At this point the EU fishing vessels are able to fish in our waters but that doesnt have to continue if we cant get on with a sensible deal.

"In my Grimsby words, Mr Barnier needs to wind his neck in and get on with some sensible negotiations."

DON'T MISSNicola Sturgeon told to honour Brexit 'promise' to Scottish fishermen[INSIGHT]British fisherman dismisses EU fears as he demands UK seize water[VIDEO]Remainers dealt crushing blow as expert warns Brexit extension trouble[VIDEO]

In June 2016 the UK voted to leave the European Union.

The UK officially left the European Union at the end of January this year.

Britain is currently in a transition period until the end of 2020 with the EU while the government negotiates a free trade deal with the bloc.

The transition will come to an end at the end of 2020. Boris Johnson has ruled out extending the transition period, despite the ongoing coronavirus crisis.

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Germany and France must do THIS for EU survival or other nations will follow Brexit - Express.co.uk

Arsene Wenger has warned that Brexit could kill the Premier League and leave English football playing second fiddle to its continental rivals.

The former Arsenal manager believes that, as the UK Government continues its plans to leave the EU at the end of 2021, football in the country will suffer if imposed restrictions are too severe.

Wenger, who spent 22 years at the helm in North London, has warned that if the Premier Leagues worldwide exposure is diminished in any way, then the best players will depart.

And if that happens, then the best coaches wont be far behind.

Wenger, speaking on the first day of the Golden Coach Congress to Mirror Sports John Cross, said: Certainly, subconsciously maybe for some people, it [ Brexit ] was to regain some sovereignty of their own destiny. And football is completely the reverse.

When I arrived, English football belonged to English people. Today, the English Premier League belongs to foreign people.

How will that change? That will depend now on how Brexit will be applied to football.

"I've asked many people, nobody knows. Will people inside Europe be considered as foreign players who cannot play in the English Premier League? I don't know.

But if the rules are restrictive, they will kill the superiority of the Premier League.

Because today the Premier League depends on worldwide exposure, with the best players and worldwide ownership with multi-billion owners from around the world.

Last season English clubs dominated in Europe.

Both the Champions League and Europa League finals were all-English affairs, as Liverpool faced Spurs in Madrid and Arsenal met Chelsea in Baku.

Wenger insists that English football has benefited from its balance of foreign and local talent.

But he believes that, should restrictions be pushed upon the Premier League and subsequently enforced, it could see English football fall behind its rivals, in a manner not dissimilar to that which saw our top sides playing catch-up in the early-mid 1990s, following the ban on English clubs from continental competition in the late 80s.

When England was suspended from Europe (late 80s), when they came back, they were far behind, added Wenger, now working for FIFA.

But before they were excluded, they were dominating it.

So that shows you, that if you have no different influences, you drop slowly back.

In recent years English football has become a destination for the planets best coaches, with the likes of Jose Mourinho, Antonio Conte, Jurgen Klopp and Pep Guardiola raising the bar at their respective clubs.

Certainly, the money on offer has played its part, but Wenger insists that the main desire for the best coaches, is simply to work with the best players; provided the latter remain, so too will the former.

Asked whether foreign coaches could be put off coming to England in future, Wenger pondered: Not if you keep the best players.

They will want to go where the best players are. So overall, that will depend on the decisions made.

But I believe youre intelligent enough in England and love football enough not to destroy what is basically a diamond today.

Sign up to the Mirror Football email here for the latest news and transfer gossip.

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Arsene Wenger warns Brexit restrictions could kill Premier League and its global appeal - Mirror Online

Published: 13 Jun 2020 13:49

Minister tells UK Government that urgent support needed within days.

The double threat of coronavirus (COVID-19) and the potential loss of access to EU funding programmes could result in long-term damage to Scottish university research, unless the UK Government provides immediate financial support, according to Higher Education Minister Richard Lochhead.

The Scottish Funding Councils recent analysis suggests the countrys universities will lose around 72 million in academic year 2019-20 alone as a result of COVID-19. An operating deficit of between 384 million and 651 million in academic year 2020-21 is expected, due largely to the likely dramatic reduction in the number of international students, a major source of income for research. Those reductions do not take account of the potential loss of EU funding.

As Scotlands university courts prepare to meet to discuss their financial predicament, Mr Lochhead has this weekend written to the UK Science MinisterAmanda Solloway, insisting she urgently delivers a comprehensive package of funding for research to counter those twin threats, taking into account the particular interests of Scotlands universities.

Mr Lochhead has been participating in a UK taskforce co-chaired by Ms Solloway and the UK universities Minister Michelle Donelan - to consider some of the financial and logistical challenges facing university research as a result of the pandemic, such as an expected loss in international tuition fee income, the potential loss of early career and experienced research talent, a reduction in business and charity funding, and delays in crucial research projects.

Mr Lochhead said:

Its vital both for Scotlands economic recovery and to protect the nations global reputation for science and research excellence that the UK Treasury signals substantial support for our universities in the coming days. The UK has aspirations of being considered a science superpower - but the institutions that can deliver on that are facing their biggest ever financial crisis. As well as several being seriously affected by COVID-19, they face potentially losing EU funding and talent as a result of a Brexit that the scientific community has said spells bad news for the sector.

Many universities are, right now, having to make difficult strategic financial decisions about their future. In the current emergency, the continued lack of clarity over funding could very soon result in the direct loss of research talent, a reduction in our research capacity and the halting or cancelation of major capital projects, with a ripple effect on the wider economy and our future global research reputation and competitiveness.

Scotland has already put together an emergency COVID-19 support package worth an additional 75 million for our university research sector. But this direct Scottish Government commitment - which has already been allocated - must be urgently complemented by a substantial UK element to ensure appropriate fiscal support is made available to Scottish universities.

In addition, detailed arrangements following the end of the Brexit transition period are still unknown, such as whether the UK will associate to the hugely prestigious Horizon Europe research funding programme. The current programme Horizon 2020 has provided more than 536 million to Scottish institutions since 2014.

The Office of Budget Responsibility highlighted in April that universities could be the sector of the economy worst hit by the pandemic so its now more critical than ever to announce as a matter of urgency a UK-backed stabilisation package for Scottish university research - a sector which most recently has been making such a vital contribution to our efforts to fight COVID-19, and our economic and social recovery from it.

BACKGROUND

Participation in Horizon 2020 has been incredibly valuable to Scotland, supporting growth by investing in research and innovation. Since 2014, over 711 million of funding in research and innovation has been competitively won by Scottish organisations, with universities securing almost 75% (over 536 million) of this. The funding won by Scottish organisations since Horizon 2020 began is around 11% of the UKs Horizon 2020 funding (over 6.6 billion). Scottish universities receive an average of 8% of their total research funding from the EC around 100 million per year mostly from Horizon 2020.

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Scottish research facing twin threats of COVID and Brexit - gov.scot - Scottish Government News

Brexit Party Chairman and former MEP Richard Tice claimed there were many benefits of Brexit for Britain that the EU is petrified of. During an interview with Express.co.uk, Mr Tice said if Britain becomes a success story it could spell trouble for the European Union. He said other countries will look at Britain as an example and may question whether they want to remain a member of the bloc.

Mr Tice said: "The EU has always been afraid of the UK not only surviving but thriving outside of the European Union.

"As we would basically be free to make our own judgements and decisions.

"With our interests in mind, we would be able to do free trade deals around the world, be able to use state aid to our advantage.

"There are loads of benefits from Brexit that the EU are petrified that we will do.

"Our economy will grow faster and we will have even more jobs and higher-skilled jobs."

DON'T MISS:Brussels panic: Michael Gove challenges EU with Brexit pressure tactic

Mr Tice also explained why he believed the EU was scared of the UK's progress and what it would mean for the bloc.

He said: "The EU simply can't have that sort of success story basically outside their front door.

"If we succeed then there will be other countries who are saying, hang on, I rather like what the UK has got."

The Brexit Party chairman reflected on the EU's attitudes towards the UK during the talks and argued the reasons why it has been difficult.

He continued: "They have always felt they have had to stamp down on us and bully us into submission.

"They were able to do that with the negotiating weakness and feebleness of Olly Robbins and Theresa May.

"But it is a completely new game now as we have got a determined Government and a chief negotiator in David Frost who actually believes what he is fighting for.

"I would say that is a pretty good starting point in my opinion."

READ MORE:

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Chancellor of the Duchy of Lancaster Michael Gove and Brexit negotiator David Frost are expected to put more pressure on the bloc in the next round of Brexit trade deal talks.

Cabinet Office Minister Penny Mordaunt explained to the House of Commons on Tuesday the pair would be working hard to ensure the UK succeeds in the next round of talks.

She explained the UK will emphasise Britain will not be agreeing to a transition period extension and will hold the EU accountable for upholding their commitments set out in the terms of the agreement.

Excerpt from:

'Petrified' EU facing crisis as Brexit success threatens to spell END of bloc, Tice warns - Express.co.uk

The downfall in UK output and Brexit issues suggest sterling may extend its slump while some troubles are brewing in America, Yohay Elam, an analyst at FXStreet, reports.

Read: UK GDP shrinks -20.4% MoM in April vs. -18.4% expected, GBP/USD unfazed

The UK economy contracted by 20.4% in April, worse than expected, and a horrible figure in absolute terms. Manufacturing output collapsed by 24.3%, a considerable miss in comparison to around 15% projected. The GDP figures have weighed on sterling and may have a longer effect as forecasts are downgraded for the second quarter and the full year.

The pound has been pounded by Brexit. While both sides agreed to intensify talks, London will formally tell Brussels that it is unwilling to extend the transition period beyond year-end. If negotiations are not fruitful, Britain will fall back to unfavorable World Trade Organization terms in 2021. Mutual accusations about the gridlock have been weighing on sterling.

Markets have finally taken note of a second wave of coronavirus as an official in Houston said the city is on the precipice of disaster and as a football stadium is being readied for use as a makeshift hospital. Treasury Secretary Steven Mnuchin said the US will not lock down the economy and claimed testing and tracing capacity has improved.

COVID-19 concerns come on top of pessimism from the Federal Reserve, which sees a return to pre-pandemic output not before 2022. Investors seem unconvinced by the bank's unequivocal commitment to support the economy.

See the original post:

GBP/USD: Horrible UK GDP and Brexit hassles pounds the pound - FXStreet