What exactly does a Brexit ‘no-deal’ mean?

  • 19 Dec 2018

Britain is getting ready for every possible scenario. Prime Minister Theresa May wants to see her negotiated deal pass through parliament but the country is preparing for a possible no-deal.

A demonstrator holds a placard during an anti-Brexit protest opposite the Houses of Parliament in London, Britain, December 17, 2018. ( Reuters )

The British government is preparing plans for a no-deal Brexit. The government will have to prepare citizens in case the country leaves the European Union without a deal in place.

It is still unclear if British lawmakers will agree to the deal Theresa May reached with the European Union.

Five leading UK business groups have already released a statement saying the country is not ready for a no-deal exit urging lawmakers to approve the deal May has proposed.

Pro-Brexit supporters hold placards outside the Houses of Parliament in Westminster London, Britain, December 19, 2018.(Reuters)

The no-deal 

No-deal means no transition period for the UK’s exit from the European Union. May delayed the vote until mid-January, drawing criticism from lawmakers who accuse her of trying to force parliament into agreeing to the deal she has proposed.

Bank of England Governor Mark Carney said leaving the EU with no transition would hit the economy in a way not seen since the 1970s oil crisis which pushed many nations into recession.

The government has approved 3,500 troops to remain on standby in case of any disruptions, while letters will be sent to 140,000 firms advising them on their next steps.

The Treasury is allocating an extra $2,5 billion to cope with a no-deal divorce. 

The members of the cabinet said 3,000 customer service and compliance staff and hundreds of border officers will be hired.

The government has also warned citizens that there might be disruptions with credit cards, booking flights and delays to medical treatment while it urged businesses to draw up a ‘no-deal plan’.

Britain's Prime Minister Theresa May (L) talks with UK Border Force officers as she visits their Command Centre during her visit to Terminal 5 at London Heathrow Airport in west London on December 19, 2018.(AFP)

Without a deal, the UK would trade with the European Union under World Trade Organization terms and Britons could see prices shooting up as the country will have to comply with non-EU tariffs.

After the no-deal exit, Ireland’s border might not remain open for trading. Theresa May has agreed to keep the border to the UK open after the exit but a no-deal scenario will see it adopting customs rules as a non-EU country.

The fate of Britain’s 3.7 million European residents is also uncertain as while the UK would be bound to the European Court of Human Rights, the international court established by the European Convention on Human Rights, it would not be answerable to the European Court of Justice, the Supreme Court of the EU.

"This is the reality of a no-deal Brexit: soldiers on the streets, medicines being stockpiled in the NHS [National Health Service], and airports and ferry terminals grinding to a halt," Labour Party lawmaker Ian Murray told MPs during the cabinet meeting.

A handout photograph released by the UK Parliament shows Britain's Prime Minister Theresa May attending the weekly Prime Minister's Questions (PMQs) in the House of Commons in London on December 19, 2018.(AFP)

Another Referendum?

May has already said no to a second referendum, which she says will break the faith of the British people.

Brexit Secretary Steve Barclay has also dismissed the possibility saying: “There are a number of scenarios being floated in government without, I think, people really engaging on the consequences of that – either the consequence to our democracy of not delivering on the referendum, not having Brexit – or the idea that we can cherry-pick and have some managed no-deal where the EU will suspend its own red lines, which I don’t think is feasible.” 

How Brexit affects the EU

Losing the bloc’s second biggest economy might have a huge impact on the European Union, the Financial Times reported.

The EU would be poorer and more affected by unemployment and low productivity and the union’s population will fall by 13 percent.

After Brexit, the EU’s economy will shrink to become smaller than that of the US. One of the main concerns is trade and a decrease in the EU’s budget.

A pro-EU supporter holds flags outside the Houses of Parliament in Westminster London, Britain, December 19, 2018.(Reuters)

UK can still stay

Despite the tough negotiations, French President Emmanuel Macron said the UK is welcome to stay in the EU if the British people have a change of heart.

The European Court of Justice is also positive on such a scenario after it ruled that the UK can cancel Brexit without asking the rest of the EU members.

Even though Theresa May is sticking with her plan to take Britain out of the EU, anti-Brexit MPs had argued that the country should have the chance to halt the exit.