Theresa May says Britain will leave EU single market

Theresa May

Theresa May

Prime Minister Theresa May signalled in a speech Tuesday that Britain will make a clean break from the European Union and not seek to remain “half-in, half-out” following the June 2016 “Brexit” referendum.

May delivered her speech to an audience of British civil servants and international diplomats at London’s Lancaster House, a Georgian mansion that has hosted international summits over the decades.

n her most detailed speech on the country’s exit strategy, she said she hoped to forge “a new and equal partnership” with the EU.

“We are leaving the EU, but we are not leaving Europe,” May said, promising to seek an agreement with the EU that meant “the freest possible trade” while allowing the UK to “control the number of people who come to Britain from Europe”.

“Not partial membership of the European Union, associate membership of the European Union, or anything that leaves us half-in, half-out,” she said. “We do not seek to adopt a model already enjoyed by other countries. We do not seek to hold on to bits of membership as we leave.”

Safeguard for EU citizens?

May had said that she would invoke Article 50 of the EU’s key treaty by March 31, to formally begin a two-year process of negotiating Britain’s departure. The negotiations, which are expected to be among the most complicated in post-World War Two European history, will decide the fate of the United Kingdom and possibly the future shape of the European Union itself.

May also said she wanted to guarantee the rights of EU nationals living in Britain, and the rights of UK citizens living in Europe, as soon as possible, although she admitted that some EU countries do not want an early deal on this issue.

May said she wanted to maintain the strongest possible relationship with the EU “with whom we share common values”, adding that it “would not be in the best interests of Britain for the EU to fail”.

May has until now refused to reveal details about the government’s goals or negotiating strategy, arguing that to do so would weaken Britain’s hand.

She said Tuesday that she would continue “not giving a running commentary” on negotiations for the sake of “column inches”.

Pound rallies

Seeking to calm fears of a sudden jolt to the economy on abruptly leaving the EU, May said she would seek a “phased process of implementation”.

Her direction will be cheered by those who want to leave the EU, but dismay those who fear the impact on Britain’s economy.

Nonetheless, the pound rallied during her speech itself, especially when she made a new announcement that parliament would be given a vote on the final terms of Britain’s exit, seen as a steadying influence.

Sterling rose 2.5 percent against the dollar, well off its recent lows and its biggest rise since December 2008, due to the speech giving much-needed detail about the government’s plans for the upcoming Brexit negotiations.

However, the FTSE 100 extended its losses this afternoon and is on track for its biggest loss since the immediate aftermath of Trump’s presidential election win.

‘No deal better than a bad deal’

Setting a firm tone for negotiations, May announced that Britain would exit the EU with no trade deal at all if it was not satisfied with what was on offer.

“No deal for Britain is better than a bad deal for Britain,” May said.

She also hinted that Britain could use tax breaks as a way to maintain businesses and London’s pre-eminence if the EU insisted on punitive tariffs. May underscored that Britain would have the freedom to set competitive tax rates to attract global companies and investors outside the EU bloc.

German Foreign Minister Frank-Walter Steinmeier welcomed May’s speech but said that negotiations could only begin when Britain gave formal notification under Article 50 of the EU’s Lisbon Treaty.

The British Supreme Court is due to rule this month on whether May can trigger Article 50 without approval from parliament.

Her speech comes as Northern Ireland, the part of the UK arguably most exposed to Brexit due to its land border with the Irish Republic, faces political paralysis after the collapse of a power-sharing government between Unionists and Republicans.

May also faces difficulty winning support in Scotland, where voters strongly favoured staying in the EU just two years after they rejected independence from Britain.