What’s happening? Joe Biden ramped up Brexit pressure ahead of the G-7 summit, and a new report says it’s too early to write off the City of London.
Joe Biden is keeping up the pressure over Northern Ireland ahead of the G-7 summit in Cornwall, England. The U.S. president’s camp is briefing that he’s worried Brexit trade tensions could imperil peace in the area. On Wednesday, U.K. Brexit Minister David Frost had what were described as 3 1/2 hours of “frank and honest” talks with European Commission Vice President Maros Sefcovic. That’s diplomatic code for a big row, according to Mujtaba Rahman of Eurasia Group.
The discussions centered on a row over the import of goods to Northern Ireland, centering on chilled meat and sausages. There were no breakdowns or breakthroughs, Frost said, but Sefcovic warned that patience in Brussels is “wearing very, very thin.” At issue is the U.K.’s effort to delay administering European Union’s customs processes that are required to protect the EU single market. London says the bloc is taking an “excessively purist” approach to border checks.
Brussels warns that the EU could retaliate with quotas and tariffs on trade. But the more sausages capture domestic voters’ imaginations (it’s not just about sausages), the less likely Boris Johnson is to care. Rather, Rahman says, the prime minister will prioritize “standing up to Brussels.” Bloomberg’s Alberto Nardelli had the scoop that Frost is accompanying Johnson this weekend, suggesting the prime minister wants a wingman if European leaders attempt to recruit Biden to their side of the argument.
Don’t write off the City of London yet. Analysis by the research group New Financial says there’s five times more international financial activity in the U.K. than France or Germany. Even if 10% of all the U.K.’s foreign business relocated, Britain would “still be a long way ahead.”
To cushion the Brexit blow, U.K. Chancellor of the Exchequer Rishi Sunak is pressing for the Square Mile to be exempt from a plan by global leaders to make multinationals pay a minimum corporate rate of tax of 15% in the countries where they operate.
Britain bagged another post-Brexit trade deal. This time it’s with Norway. The agreement builds on a roll-over accord signed at the end of 2020. It supports 18,000 fish processing jobs in Scotland and the north of England, the U.K. government said.
We aim to keep you up to date on how the U.K. navigates the world after Brexit. Got tips or feedback? Email us at email@example.com
Chart of the Week
Britain’s housing market is roaring despite the worst recession in three centuries, with Nationwide Building Society in May recording the first double-digit price growth since 2014. Most office workers anticipate they can avoid commuting at least once or twice a week, prompting many to look for property outside London. It also suggests that the rush for space is outweighing any headwinds to the economy from Brexit The resulting surge in prices has alarmed Bank of England policy makers.
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