Brexit News, Member News

The weekly Vulcan View for the 11th to the 15th of June featuring analysis of the latest EU developments


US Diplomacy in Despair after Trump’s Reversal on Negotiated Communiqué
US President Donald Trump disregarded weeks of diplomatic efforts, alienating his traditional allies and six of the strongest global economies, after descending into a flurry of tweets criticizing Canada and Europe as he left the G7 summit last weekend. Tensions were already high in the days leading up to the summit between the world’s largest economies due to the White House’s imposition of steel and aluminum tariffs on its allies and the promised retaliatory tariffs from the EU and Canada.
The subsequent negotiations at the summit, which were dominated by the issue of trade, were tense as the US President refused to back down on his proposed tariffs. Nevertheless, the agreed-upon communiqué expressed the world leaders’ commitment to free and fair trade. However, the US President withdrew his support for the statement following a press conference by Justin Trudeau in which the Canadian Prime Minster called the US tariffs “insulting”. Trump responded with tweets personally attacking Trudeau as “weak and dishonest”.
Responses from the G7 leaders to this unexpected fallout were frank. German Chancellor Angela Merkel called it “sobering and a bit depressing”, whereas the French President Emmanuel Macron tweeted that the US had “isolated” itself against a “united front”. While President Trump appears to laud his new-found success in negotiations with North Korea, it appears that the traditional transatlantic trade relationship looks set to deteriorate even further, the results of which could significantly impact global economic interests.


Prime Minister faces renewed Tory rebellion after backtracking on amendment 
The British Prime Minister Theresa May is heading for a fresh showdown with a group of rebels within her own Conservative Party after they rejected a government-drafted amendment to the EU withdrawal bill. Accusing Ms. May of going back on an ‘’agreed’’ form of words that they believed would grant members of parliament new powers to oversee the concluding stages of the Brexit negotiations and block a ‘’no deal’’ exit from the EU if necessary, the rebels peers said the newly worded amendment ‘’cannot be accepted’’.
The Tory grouping are now planning to re-table an amendment with the original wording that was drafted up by the former attorney general Dominic Grieve. The format of the original amendment crucially contained Mr. Grieve’s clause 5C, which would of allowed MPs to ‘’direct’’ the government in the event of a new deal. However, the new amendment that was drawn up by the government and rejected by the Tory rebels last night only promised a debate on a motion ‘’in neutral terms’’.
The bill goes back to the House of Lords on Monday and this will give Mr. Grieve and his rebel conservative allies an opportunity to table their version of the amendment again. The breakdown of trust between Ms. May and this influential collection of MPs will be dangerous to the Prime Minister, particularly as the rebel peers could side with the opposition parties to defeat Ms. May when the flagship EU withdrawal bill returns to the Commons next week.

France and Italy descend into dispute over migration row
A diplomatic row between Rome and Paris erupted this week after the French President Emmnauel Macron criticised Italy’s relatively new populist government over its hard-line immigration policy which saw it close its port to a migrant ship earlier in the week. Tensions between member states first began to mount on Sunday when a migrant rescue boat carrying 629 migrants was refused entry by both Italy and Malta, leaving the ship stranded in the central Mediterranean until Spain intervened and offered the ship to disembark in Valencia.
There appeared little sign of how the impasse between Rome and Malta would have been resolved before Madrid stepped in and such a standoff over migration responsibility has long been an issue that Brussels must have feared and widely expected. While Spain’s offer to take in the migrants in place of Italy was labelled as a ‘’Victory’’ by Mr. Salvini, French President Emmanuel Macron was infuriated by it and said that the Italian government had acted with ‘’cynicism and irresponsibility’’ by closing its port.
Mr. Macron’s remarks have since been heavily criticized by Rome and the dispute between the governments escalated quickly when Italy summoned France’s envoy to explain its actions and then when the  Italian finance minister, Giovanni Tria, cancelled a visit to Paris to meet his French counterpart. Although diplomatic relations are still on edge between the two countries, Paris assured that a planned meeting between Mr. Macron and Italian Prime Minister Giuseppe Conte would still go ahead today.
The Northern league wing of Italy’s new populist government had promised to crackdown on immigration when it came to power and it appears that it is following through on its pledge meaning that the current diplomatic standoff over migration will not be the last. Rome’s new hard-line approach may find favour with other member states however, after Austrian chancellor Sebastian Kurz called for a ‘’Rome-Berlin-Vienna axis of the willing’’ to fight illegal migration.
Commission plans to triple spending on tighter border controls 
Brussels has proposed to triple the budget allocated to migration and border management controls from the current level of €13 billion to just under €35 billion under the next Multiannual Financial Framework for the years of 2021 – 2027. In a bid to beef up the border defences of its member states, the Commission is intending to establish a 10,000 strong border force to patrol its land and sea frontiers as it attempts to turn the tide against illegal migration into the bloc.
The bloc has struggled to effectively manage the huge migration flows, which peaked in the summer of 2015, and member states remain hopelessly divided on resolving the issue. With negotiations between interior ministers over how to reform the so-called Dublin regulation still at a deadlock, Brussels is hoping this latest proposal will prepare the EU for the next migration crisis. In addition to the expansion of the border guard, the proposal will also incorporate the building of new border infrastructure such as scanners and automated number plate recognition system, and mobile laboratories for sample analysis.
The announcement of the extra funding is timely given the bitter dispute that has erupted between France, Spain and Italy after the later refused to take in a rescue ship carrying hundreds of migrants. Speaking at the launch of the proposal, the Commission’s migration chief Dimitriss Avramopolous said the responsibility of the ship, which eventually docked in Spain, did not lie with Madrid, Rome or even Malta but rather the whole of the EU. Labelling it as needing a ‘’European response’’, Mr. Avrampolous warned that if the bloc was not ready for the next migration crisis, it could jeopardise the union itself.
Greece and Macedonia reach tenuous resolution over naming dispute
The 27-year dispute between Macedonia and Greece over the former’s name may soon be resolved, as both sides have agreed to the former Yugoslav Republic of Macedonia being renamed the Republic of North Macedonia, a geographically qualification which removes ambiguity as to the country’s claim on the Greek region by the same name. The agreement was reached on Tuesday between the Prime Ministers of the neighbouring nations, whose relationship has been fraught over rival claims not just to this name, but also to ancient Greek culture and figures, including the king Alexander the Great.
Both the Greek Prime Minister, Alexis Tsipras, whose left-led administration took power in 2015, and the former Republic’s Social Democrat Zoran Zaev, have long been committed to ending the nationalistic dispute, which has harmed bilateral ties and prevented Macedonia’s entry to the EU and Nato. The Greek government has agreed to drop its opposition to its neighbour’s membership to both the upcoming EU and alliance summits  Diplomats from across Europe and beyond have come out in support of the agreement, which should promote further peace and stability in the region.
The resolution, however, has not received universal support. Greece’s main opposition party, the New Democracy party, is calling for a vote of no confidence in the government, as a result of this perceived surrendering of national rights. On the other side of the border, the president of Macedonia, Gjorge Ivanov, announced hours after the agreement was made that he opposes the deal, calling it “shameful,” “harmful,” and “unacceptable to me.” The president has limited power and cannot overturn the name change.
However, steps remain to be taken to ensure the successful name change. Mr Zaev must hold a referendum on the change, which will require over 50% participation. He will also need constitutional changes to remove any territorial claim on the Greek region of Macedonia to be passed in parliament, where he doesn’t hold a majority. The Greek government will equally need to canvas for support in Parliament to ensure the agreement is passed.

Dates ahead: Monday 18th June – Sunday 24th June
Mon 18th – Thurs 21st June: European Parliament Committee meetings
Wednesday 20th & Thursday 21st June: Basel Committee on Banking Supervision
Thursday 21st June: Bank of England Monetary Policy Committee meeting
Thursday 21st June: Eurogroup meeting

And Beyond 
Tuesday 26th June: EU General Affairs Council (Art. 50)
Wednesday 27th June: ECB non-monetary policy committee meeting
Thursday 28th June: ECB General Council meeting
Thurs 28th & Fri 29th June: European Council Summit


Compliments of Vulcan Consulting, a member of the EACCNY