UK election heralds Brexit talks showdown

Whatever the outcome of Thursday’s UK general election, the new government will soon have to commence formal negotiations with the EU about the terms for Brexit. These are likely to be difficult talks that last until the end of next year.

The UK does not start the negotiations from a position of strength. Brexit will have a bigger impact on the UK economy than the EU. The agenda and timeline for the talks is being set by the EU and the UK does not have a veto on the final terms of any deal. Prime minister Theresa May has stated that no deal is better than a bad deal.

However, two-thirds of UK trade is with the EU or countries that have free-trade deals with the EU. It is hard to envisage a worse outcome for the UK than if it leaves the EU with no deal.