Vicars’ daughters. Theresa May began her tour of Europe this week, meeting with Angela Merkel and Francois Hollande. A divide in stance has emerged between the EU leaders. Hollande insists that the UK should invoke Article 50 as soon as possible, and reiterates the unity between single market access and free movement of people. In a seeming softening of position Merkel appears more equivocal, stating a preference for definition of the negotiation, rather than speed. For the time being, a common approach between two vicars’ daughters.
Markets and movement. The property market is impatient for certainty; but getting the right balance between single market access and control of borders is imperative for long term growth. The two are aligned, but which of the two is more important? Simplistically, if negotiations ended without an EU trade deal, we would pay an average 2.4% tariff on exports; but relinquish an equivalent 7% net contribution, which taken in isolation implies a financial benefit to being outside the single market. This is too simplistic. All the same, many still believe that restricting freedom of movement might create a bigger financial detriment to some UK businesses. Whether the electorate agrees is a different matter.