Theresa May’s decision to call a general election on 8 June is timed to minimise disruption to the negotiations with the EU. The early stages were always going to be about modalities - about who will participate, what they will discuss and when - and that can still happen in the run up to the election. The serious discussions, requiring high-level political backing, will need to wait until the new German government is in office after elections there in the autumn.
With the UK Parliament likely to dissolve on the 2-3 May, ahead of the 8 June election, there will now be a frantic scramble for the UK government to complete the passage of legislation currently in train. This process, known as the wash-up, was thought to be relatively obsolete with the introduction of fixed-term parliaments. Revived now it will be controversial, as the normal process of parliamentary scrutiny is substantially truncated.
Central bankers have never operated in a political vacuum, even though many of the most important are at least operationally independent. For some, that independence is now being eroded - or even directly challenged. The result is a creeping politicisation of policy, at a critical decision point for monetary policy, which may have long-lasting economic implications.
When you mention EU states competing to win a prestigious and powerful European regulatory agency from Britain after Brexit, most people would probably think of the European Banking Authority. But the European Medicines Agency (EMA) is also up for grabs, and the most intriguing bidder is Bucharest.
The early stages of any negotiation are all about positioning. The Brexit negotiation is no different. British Prime Minister Theresa May’s letter invoking Article 50 - and the draft negotiating guidelines issued by European Council President Donald Tusk - are both exercises in positioning. Each sets out objectives and constraints, as the two sides compete to shape the negotiations in their favour.
When the European Commission holds its public hearing on the Capital Markets Union (CMU) tomorrow, one of the key questions will be how to promote fintech while ensuring consumer confidence. Tools such as crowdfunding have become a potentially revolutionary means of alternative financing, giving the CMU serious growth potential. At the same time, they present new policy challenges on solvency, cyber risk and data access.
Whatever gets discussed at Mar-a-Lago between Donald Trump and Xi Jinping, it probably won’t include climate change. Trump has just ripped up Obama’s Clean Power Plan and approved Keystone XL. Xi is positioning China as the new global leader in climate change. Anyone trying to make sense of what this means for demand for renewables and the global dynamic in climate policy obviously has an interest in wondering what this adds up to. Xi can legitimately argue that he is bringing more to the energy transition table than the Trump administration is. But that is a very low bar. How seriously can we take China’s claim to leadership?
Regional UK city Lincoln’s hospital’s Accident & Emergency Department was at risk of being closed this week. This was not due to a deluge of patients or a lack of funding but rather the result of a recent tweak to the UK’s tax rules and could have far reaching ramifications for the UK-wide review of self-employment practices, currently underway.
As European leaders head to Rome this weekend to contemplate the EU’s future, there is an elephant in the room, and it is not actually Brexit. It is the question of whether the EU is ultimately reaching the zenith of the harmonising push begun with the creation of the single market thirty years ago. The logic of Brussels has always been that unity follows uniformity. One of the more interesting subtexts in Rome will be the idea that one path to unity may be to accept – even encourage – differences. In Versailles a few weeks ago when France, Germany, Spain and Italy met and formally restarted the multi-speed debate, French President François Hollande proclaimed that “unity does not equal uniformity”.
We were lucky to have former MEP and Dutch Labour Party President Michiel van Hulten in to GC this week for a briefing on the Dutch election. Michiel provided plenty of food for thought, especially on the coalition-building dynamic over the weeks (months?) ahead. A couple of things stood out from the group’s discussion for me.