No end in sight to Brexit brinksmanship

THERESA May made on Tuesday one of her biggest Brexit u-turns so far, throwing significant new uncertainty around the UK exit process. Having said around 80 times over two years that the United Kingdom will definitely leave the EU on March 29, she has now opened up the option of extending the Article 50 process till at least the end of June in what could yet become a major turning point in the Brexit debate.

With Mrs May under growing pressure from MPs and Cabinet ministers to give concessions, she asserted that if her Brexit withdrawal deal is voted down again in the next meaningful vote on or before March 12, MPs will be allowed two further options. Firstly, they will be given a say on whether to support leaving the EU with "no deal", or extending the Article 50 process.

These latest developments are potentially so significant as they come only a day after opposition leader Jeremy Corbyn moved on Monday more strongly towards supporting a further Brexit referendum if Mrs May does not adopt the Labour Party's softer Brexit stance, which includes moving towards a customs union with the EU. While this has been perceived as a big shift, Mr Corbyn's move is actually an evolutionary step which follows a resolution passed last September at the annual Labour conference which overwhelmingly passed a statement to keep the option on the table of a second referendum.

Unless Brussels unexpectedly offers more concessions on the so-called Irish backstop to Mrs May before March 12, or Brexiteer MPs and the Democratic Unionist Party cave in to the prime minister, it seems most likely at this stage that MPs will still not back her withdrawal deal in the first half of March. In this scenario, MPs will therefore need to decide whether to accept no-deal and, if that fails, an Article 50 extension.

There is growing momentum in Parliament against a no-deal, and it is therefore most likely this option will get voted down barring a big change in sentiment, although that is by no means guaranteed. The term "no deal" is widely misunderstood by much of the UK public, let alone international audiences. It means a situation whereby the United Kingdom and EU fail to agree a withdrawal agreement under the terms of the two-year Article 50 process which began in March 2017.

This scenario would mean that London will automatically leave the EU on March 29 without many, if not all, of the rules that regulate the UK's relationships with the EU. And, also, many economic relationships with the rest of the world too will be undermined as these are underpinned by trade treaties that the Brussels-based club has agreed with key nations from Canada to Japan.

While many assume there is just a single no-deal outcome, there are actually plausibly multiple "no-deal" scenarios. At the extreme end of the spectrum is a chaotic "no-deal" Brexit whereby negotiations between Brussels and London break down acrimoniously with the latter potentially refusing to pay the proposed £39 billion (S$70 billion) divorce deal, and the EU refuses to put any mitigating measures in place, including a transition period.

If the "no-deal" option is voted down in mid-March by Parliament, this would raise the prospect of MPs potentially voting to extend Article 50. Should the EU-27 unanimously grant this request, a key question is how long this extension would be for.

One possibility is London will ask for, or be granted, only a very short technical extension of potentially a month or less. However, if London sought and obtained an extension to Article 50 that went beyond July 2 - the first day the new European Parliament meets - UK politicians would have to take part in that legislature's elections on May 23-26 (unless an exception is made). It is for this reason, and the complications this would bring, that the prime minister said Tuesday that she does not countenance extending beyond the end of June.

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Of course, there is also a possibility that Parliament could reject in mid-March both "no-deal" and an extension of Article 50. In this scenario, the European Council's summit on March 21-22 would become the most likely Brexit withdrawal "end-game moment".

It is perhaps only then that the EU-27 will offer up any further concessions to London, around the Irish backstop, on the Brexit withdrawal deal. By any standards, kicking the can down the road in this way to late-March would be brinksmanship diplomacy of the highest order.

However, in circumstances where the outcome of EU-UK talks is still not clear by March's summit, there are at least three main outcomes, other than the continued possibility of a further Brexit referendum and/or general election. The first is the prospect of "no-deal", unless the UK Parliament has sought to take this off the table earlier in the month, which both sides are now ramping up preparations for given the chaos that could ensue.

A second possibility, especially should Mrs May get final concessions from the EU-27 on March 21-22, will be expediting votes from March 23 through both the House of Commons and the Lords. While primary legislation of this sort can be rushed through quickly, in principle, the government cannot rule out a significant number of amendments being tabled that could still make the currently scheduled March 29 departure date unattainable.

The withdrawal deal would also need to be ratified by the European Parliament. Here, a Strasbourg meeting of Members of the European Parliament (MEPs) from March 25-28 would probably be the last chance for them to vote through the deal, leaving EU ambassadors only hours to potentially rubber-stamp the deal.

Given how close to the wire this would be, it is also possible that Mrs May could ask in the last week of March for a last-gasp extension of Article 50. Should the EU-27 grant this, both the Commons and Lords must also vote to allow the currently legally binding exit date of March 29 to be changed.

Taken together, after the UK's latest bout of Brexit drama, the withdrawal end-game is unlikely to come before mid-March at the earliest. However, if the UK Parliament cannot make up its mind by then over Mrs May's deal, "no-deal", and an Article 50 extension, attention will turn to March 21 and 22 which, so late in the day, could see a frenzied last week of brinksmanship before March 29.