Duncan Robinson

Like a couple in a strained marriage, the EU’s 27* national leaders will in September head to Bratislava for a day by the Danube to get away from it all and try to remember why they are still together.

“Sometimes member states need to have intensive discussions among themselves,” said Robert Fico, the Slovakian prime minister who will play host/marriage counsellor. The reason for the city break? “Brussels tends to have a rather negative connotation these days,” says Mr Fico. Read more

Where to begin? First order treachery, the double Brutus, a “cuckoo nest plot” – this is a political assassination that will go into Conservative party lore alongside the defenestration of Margaret Thatcher. On a cold summer morning, Boris Johnson’s career was laid waste in a matter of hours by his campaign director and confidante Michael Gove, the Brexit-whisperer who convinced him to turn on Brussels. Politics in a democracy does not get more savage than this.

Was this betrayal plotted over months, days, hours? What role did the chancellor George Osborne play? Was Mr Johnson making his own overtures to step aside for Theresa May, the home secretary? The Westminster lobby have done a wonderful job of reconstructing the high-intrigue and low-skulduggery of Johnson’s undoing. Read more

What if ‘Brexit’ – an outcome dreaded in Paris and European capitals – was a gift in disguise? The thought crystallised in François Hollande’s mind on Saturday, when he sat with Marine Le Pen, the leader of the National Front party, at the Elysée Palace. The French president hosted the full spectrum of French politicians to assess Britain’s Brexit vote. All eyes though were on Ms Le Pen, who had been sporting a victorious smile since the UK result.

The far-right leader quickly reiterated her wish to hold an EU referendum herself. “What would be the question?” the president asked her, according to a person who attended the meeting. In or out, she replied. “Out of the EU or the eurozone?” Of the EU, she confirmed – of the eurozone, the Schengen passport free zone, and all the rest. Ms Le Pen’s position has changed – in the 2012 presidential race she focused on scrapping the single currency. Like kindred spirits on the right of Dutch and Danish politics, she has been emboldened by the UK referendum, and become more radical.

For Mr Hollande, who despite record levels of unpopularity is contemplating reelection, it makes sense. Ms Le Pen’s core battle is immigration and she can blame the EU for a refugee influx. By putting the EU at the heart of the campaign, she also seeks to revive the eclectic 2005 coalition that voted down the EU constitution.

But it is a risky strategy. Read more

EU leaders resume their meeting this morning with one conspicuous absentee. David Cameron is locked out of deliberations – the first time in more than 40 years that a UK prime minister has been excluded. Better get used to it.

Last night saw one of the more awkward dinners in recent diplomatic history, as Mr Cameron tried to explain the meaning of Brexit to his sombre European counterparts. Read more

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EU leaders resume their meeting this morning with one conspicuous absentee. David Cameron is locked out of deliberations – the first time in more than 40 years that a UK prime minister has been excluded. Better get used to it. Read more

Jim Brunsden

Britain’s post-Brexit referendum rollercoaster continued full pelt on Monday, as the pound hit a new 30-year low, bank stocks crashed, and the opposition Labour party carried on tearing itself to pieces.

Having addressed parliament yesterday on his plans for handling the immediate next steps, David Cameron will face other EU leaders at a summit tonight in Brussels. His authority shattered at home, and with little remaining goodwill to draw on abroad, Cameron is set to find it a deeply awkward occasion. Read more

Duncan Robinson

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After the shock, the reality. Across Europe, politicians, officials, voters and businesses have asked themselves a simple question following the Brexit result: what now?

In Westminster, a political vacuum has emerged. Britain has lost a prime minister and not yet filled his role. Conservatives are jostling for position as David Cameron’s successor. Labour, meanwhile, has turned inward, with shadow ministers launching a coup against their leader.

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Wondering why there is such a fuss over Article 50, the so-called EU exit clause? We’ve annotated the Article 50 text to explain the issues in full. (If you’re using Next FT and can’t see the embedded document, please follow this link.) You can read more about the Brexit divorce talks here and here.

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Europe is awakening to a momentous morning. Britain has voted to leave the EU. Sixty years of European statecraft has gone into reverse. Britain’s government is in turmoil. Markets have plunged. Sterling has suffered its biggest fall in 30 years. The uncertainty over what comes next is palpable.

Britain’s vote will transform not just Britain and its place in the world, but spill over into global markets, Europe’s economy, and the balance of power on the bloc. The coming hours will be of historic importance, framing what will be a protracted and difficult divorce. The potential consequences of this vote are hard to overstate. This is the biggest challenge for the continent since the end of the Cold War.


A Brexit vote that changes everything. The referendum gamble that left Mr Cameron’s career in tatters. Our guide to the world’s most complex divorce. The fallout for Europe and the world. The bumpy road for the British economy. The bitter campaign that divided Britain. The FT live blog. What happens next. How currency markets called this wrong. Brexiters find their fizz. Europe’s populists cheer.


Duncan Robinson

Welcome to Thursday’s edition of our daily Brussels Briefing. To receive it every morning in your email in-box, sign up here.

It is finally here. After months of negotiations, threats, Nazi-comparisons, pasty-waving and even rapping by politicians, voters will head to the polls today to answer a simple question with profound implications: should the United Kingdom remain a member of the European Union?

The bickering will come to a close and a surreal peace will break out on British airwaves during the day due to reporting restrictions for mainstream outlets. Even swings on the markets – some in the City have paid for private exit poll data – will not be analysed in depth. Read more

Jim Brunsden

As everyone who has played the famous video game knows, Super Mario is not always super. Temporarily able to boost his size and powers, he is nevertheless, for much of the time, just regular Mario.

What to make then of ECB president Mario Draghi? The eurozone crisis has seen the ECB repeatedly expand its operations in its bid to stimulate the euro area economy. As Mr Draghi has repeatedly said, these “extraordinary measures” were meant to provide a temporary breathing space for governments. Instead, politicians have proved all too willing to let the ECB permanently shoulder the load.

In a hearing before the European Parliament yesterday, Mr Draghi cut a frustrated figure as he set out the steps nations need to take to finish building their “incomplete” and “still fragile” monetary union, and to make their economies more competitive. Read more

Some sovereignty obsessed people with little practical economic sense are preparing to make a decision with the potential to seriously spook European markets. And no, we don’t mean the Brexit referendum.

In a few hours Germany’s highest court will rule on the legality of the European Central Bank’s most contentious weapon in fighting the financial crisis. At 10am local time, Mario Draghi’s ‘whatever it takes’ scheme will meet the ‘whatever we say’ of the Karlsruhe.

This is the finale of a long legal saga that has dogged the ECB’s Outright Monetary Transactions programme for most of its 4-year existence. Mr Draghi’s promise to, if necessary, buy unlimited eurozone bonds has never been used, but its effects were palpable. Mr Draghi challenged the speculators to bet against him, and they blinked.

The FT’s ECB watcher Clare Jones does a fine job of explaining the issues and the ping-pong between the Karlsruhe and the European Court of Justice that preceded this decision. The bottom line is that the Karlsruhe has already voiced reservations about the design of OMT – and may today take a stricter line than the ECJ. At worst it could legally hobble the scheme.

The timing is extraordinarily. On an economic level, markets are already fretting over the referendum. The ECB and the Bank of England are preparing to flood the market with liquidity and take some edge off a negative reaction. But if investors seriously turn against the eurozone periphery – as officials in Brussels and Frankfurt fear – OMT could be crucial. Its credibility matters.

On a political level, too, this is an unusually sensitive moment. What are the implications of a national court thumbing its nose at the ECJ on such an important EU policy decision? For decades the Karlsruhe has coexisted with Europe’s highest court in an uneasy legal truce, with each one claiming supremacy and the final say on law but never testing the premise to the point of destruction.

If the Karlsruhe imposes its will – and takes back control, as the Brexiters would say – what will British eurosceptics think? It could certainly inspire some interesting lawmaking in Westminster, even if there is a Remain vote on Thursday.


The polls are looking better for Remain. It is still close, but the apparent swing was enough for sterling made its biggest one-day gains in eight years. Read more

Europe’s four most powerful men are in peril, fighting for their political lives in some choppy and unusual electoral waters. Whether this week in the case of Britain’s David Cameron or Spain’s Mariano Rajoy, or in the coming months with regard to Matteo Renzi and Francois Hollande, each one is nearing a career-defining reckoning with voters. The four cover opposite ends of the mainstream political spectrum, but share a common fear: being undone by primal anti-establishment forces. Such is the lot of Europe’s political princes.

David Cameron’s verdict There is a touch more optimism in Downing Street on the EU referendum. After a tumultuous week, poll momentum has swung back to Remain (as well as defections). Mr Cameron also delivered a solid TV performance on Sunday night, channelling his inner Winston according to the FT’s Henry Mance. Note the emphasis on this referendum being a no-turning-back decision on the EU – but not on Mr Cameron. His approval ratings have plummeted but he insists this vote is not a verdict on him. It appears he may try, against the odds, to hold on to power after a Brexit win. Given what it would do to his legacy, what does he have to lose?

Matteo Renzi’s star falls Once the golden-child of this political quartet, the restless Italian Socialist is facing a ballot-box revolt. The Five Star movement routed Mr Renzi in Rome’s municipal elections last night, making Virginia Raggi the eternal city’s first female mayor. In a big upset Turin was lost as well to a 31-year old Five Star insurgent, Chiara Appendino. Mr Renzi’s Democratic party did manage to draw the line there, hanging on to Milan and Bolgna, where it was facing a more traditional run-off with centre-right opponents. All eyes are now on the October referendum on constitutional reform that Mr Renzi said he would win or quit. His enemies are circling.

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Jim Brunsden

“Which debt relief agreement are you talking about?”

If anyone had any doubts that Christine Lagarde, the managing director of the International Monetary Fund, doesn’t think much of the debt relief deal for Greece that was struck last month by the Eurogroup, these should have been firmly laid to rest by her comments at a press conference in Luxembourg on Thursday.

Asked about what she thought of the outcome of euro area finance ministers’ marathon meeting last month on Greece, which reached some tentative agreements on easing Athens’ massive debt burden, Ms Lagarde appeared to question whether it amounted to a meaningful breakthrough at all.

“Which debt relief agreement are you talking about?,” Lagarde said, before smiling conspiratorially. “I think you have my response in my question actually.”

The issue of debt relief has become central to the roll out of the €86bn euro area bailout of Greece that was agreed on by euro area leaders last summer. The IMF has refused to take part in the programme unless relief is granted, and has challenged what it says are over optimistic EU predictions for the recovery of the Greek economy.

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Westminster is in mourning. Campaigning is on hold. The grief over the murder of Jo Cox MP is raw and palpable. The implications for Britain at this historic juncture are hard to predict. Six days out from the referendum, in the midst of an angry and shrill campaign, politics has suddenly taken a different hue. This was a dark moment for democracy in Britain and an unbearable tragedy for one young family. Start your reading with Alex Massie of the Spectator on a day of infamy.

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One of the most striking quotes ahead of Britain’s referendum was Michael Gove’s claim that “people in this country have had enough of experts”. As this polling data shows, the Brexit backing justice secretary was on to something, at least when it comes to Leave supporters.

The YouGov pollsters gauged public trust in the views of “experts” and politicians when they speak about the EU referendum. It is no surprise that both Leave and Remain supporters are wary of politicians – both at home and abroad – albeit by different margins.

When it comes to experts, though, there is an chasm. Remain supporters tend to believe academics, economists and people from the Bank of England. Leave backers mistrust them all, especially if they come from Threadneedle Street (net trust minus 45 per cent). You can add business leaders to that list too (plus 28 per cent trust among Remainers, and minus 28 for Leavers).

There is a paradox to this. As the FT’s Chris Giles notes today, there has rarely been such “expert” consensus on an issue. While economists argue over how harmful Brexit would be, there is near unity that it would be harmful to the economy. The dismal science is in speaking in concert for once and the public just don’t seem to be listening. As Tobias Buck found in a report from revolutionary Bracknell, middle England is in an iconoclastic mood. Read more

Jim Brunsden

Nearly six months after knuckling down to work on the next stage of overhauling EU bank rules, finance ministers will meet in Luxembourg on Friday to acknowledge that they aren’t where they want to be.

Rather than being able to hail progress in the next steps of the euro area’s ambitious “Banking Union” reform programme, instead they have to tackle fundamental splits over how to take the project forward. If they can.

The divisions are laid bare in a package of documents prepared by the Netherlands, which holds the rotating presidency of the EU, and which is trying to chart a course for future negotiations before handing the reins over to Slovakia at the end of the month.

To pick through the splits, the FT Brussels blog has posted an annotated copy of the main Dutch document here (just click on the parts highlighted yellow:)

At the centre of the ruckus is the Commission’s proposal for the euro area to create a centralised system to guarantee bank depositors, known as the EDIS.

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There are 8 days left of the campaign. Little wonder contingency planning is in overdrive. Three different perspectives are laid out today in the press: from the Leave side on the divorce; from the Remain side on the consequences; and the worried Remain side on last-ditch offers to save the campaign.

First for the Brexiters. Chris Grayling, leader of the House of Commons, outlines a detailed vision of Brexit to the Financial Times. It is a complex but significant insight on how a divorce may proceed, and it doesn’t match expectations in Brussels. The Leave side would legislate in the UK to leave by 2019, but would not necessarily invoke Article 50 of the EU treaty, aiming instead for an “informal” process that sets future trade termsat the same time. In other words, they do not want a trade deal taking longer than the EU break-up. So two years to do it all.

That takes goodwill on the EU side – and it will probably be in short supply. Mr Grayling says the UK will curb the powers of the ECJ straight after the referendum vote – andcurtail free movement rights before 2019 to avoid an influx into the UK. There is not much the EU can do about that; the EU is a sovereign club based on law and good faith. But it may be hard asking for favours. More positive for Brussels: Mr Grayling said budget payments would continue. “I don’t want to break the law as part of the process”. A cheeky European Commission may ask: can we have £350m a week please?

The fiscal contingency George Osborne, chancellor, has set out his post-Brexit budgetto The Times. Unsurprisingly there is no attempt at sugar coating. Income tax up, fuel duty up, inheritance tax up, beer tax up, dramatic cuts across the public sector, all aiming to fill a £30bn fiscal gap he argues was identified by the Institute of Fiscal Studies. The Leave side dismissed this as “hysterical” fear mongering (and think the chancellor will beout of a job anyway). The question is whether it is a sufficiently brazen a claim to move the subject back to the economy, rather than immigration. Remain’s fate may rest on it.

The panic contingency The poll momentum is against Remain and the panic is showing. Tom Watson, Labour’s deputy leader, raised the idea of pushing for urgent reforms to EU free movement – setting off speculation in Westminster about desperate last-ditch measures to rescue the campaignRead more

This is a day of reckoning for France’s union barons. Thousands of protesters are expected to take to the Paris streets again today, seeking to shame politicians into dumping already watered-down plans to reform labour laws. But all that noise may belie a more uncomfortable reality for Philippe Martinez, the union ringleader for the strike. He may have badly overreached.

The gruff, mustachioed boss of the General Confederation of Labour (CGT) said the demonstrations would be “massive”. His reputation is on the line in what Le Journal du Dimanche has dubbed the “final round” of his battle with the government. The New York Times does a smart job of looking at the stand-off. The piece highlights the complex undercurrents in the French labour movement – notably a bloody succession battle to lead the CGT as its fortunes have waned – that are driving militant action in what is ironically “one of the least unionised countries in Europe”.

And here lies the danger for Mr Martinez. The CGT-led strikes have been a costly nuisance but the disruptions don’t seem quite as bad this week. The rubbish in Paris is finally being collected again. The government seems to be standing its ground (albeit to protect far weaker reforms). Public patience is wearing thin. And most importantly, attention has turned to the football – and France won its first game. If turnout is mediocre on Tuesday, what Mr Martinez described as a protest airplane “just taking off” in late May could appear to be running low on fuel.

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The polls are tightening, markets are jittery, and Downing Street is so alarmed it is relyingon Gordon Brown to save the Remain campaign. It may be time to start talking about the day after Brexit, and whether there is a way to engineer a soft-landing.

The “what happens next” issue is tackled today by Donald Tusk, the European Council president, in a typically punchy interview with Bild Zeitung.

“The leave campaign contains a very clear message: ‘Let us leave, nothing will change, everything will stay as before’. Well, it will not. Not only economic implications will be negative for the UK, but first and foremost geopolitical. Do you know why these consequences are so dangerous? Because in the long-term they are completely unpredictable. As a historian, I am afraid this could in fact be the start of the process of destruction of not only the EU but also of the Western political civilisation.”

He later says divorce will be “sad” but manageable within 2 years. But he notes a parallel trade deal – setting the future EU-UK relationship – will be far tougher, and take at least another 5 years after the divorce, if it can be agreed at all. Long as it seems, this 7-year drift is actually optimistic version of the “decade of uncertainty” that David Cameron and Whitehall have described.

If markets react badly to a Brexit vote, there will be huge pressure to find a quick EU fix for a smooth transition (what Wolfgang Münchau calls letting the Brits go in peace). But even under such market duress the political options look poor. Read more