Written by 9:41 am European Union

Truss, the Iron Weather Vane, Faces Chilly EU Wind

Liz Truss isn’t Boris Johnson. That was the main crumb of comfort for European Union diplomats and leaders as congratulations from Paris to Helsinki flowed to the new resident of 10 Downing Street. After years of Johnson’s antics, from threats over post-Brexit trade to calling the French “turds,” relations surely can’t get any worse.

But EU officials know deep down they will have their work cut out in trying to improve ties. Even as Russia’s invasion of Ukraine and runaway energy prices should be binding Western allies closer, there’s justified pessimism that Truss, the self-styled Thatcherite — dubbed the “iron weather vane” in the French media, rather than the Iron Lady, given her past political U-turns including Brexit itself — will have the freedom or desire to end the EU blame game that helped win her win the Conservative leadership. 

Continental optimists feel they’ve been burned by Truss once before, when she used her combined role as foreign secretary and Brexit negotiator earlier this year to help launch a frontal assault on the EU divorce deal approved in 2020, championing legislation that would tear up trade terms in Northern Ireland that avoid a return to a hard border by effectively putting it in the Irish Sea.

The claim that this is the only option to fix technical issues worsened by an inflexible EU is at odds with the deal’s support on the ground and past negotiated concessions by the European Commission’s Maros Sefcovic — and with the UK’s own signed commitments.

There’s continuity here with the Johnson era, and not just because Truss has inherited his parliamentary majority. Talk of a trade-deal “fix” masks a deeper need to scapegoat the EU for the disappointments of a Brexit project that has brought economic costs to the UK without promised benefits such as a US trade deal or financial-sector deregulation. Hence the rhetoric that the EU only understands “strength” or that “the jury’s out” on whether France is an ally — just a few of Truss’s recent zingers.

EU officials are understandably taking a defensive stance, with Commission President Ursula von der Leyen calling on Truss to “respect” UK commitments. The bloc will be under pressure to show its defense of the single market won’t waver — even amid the war in Ukraine and a looming euro-zone recession — and that breaching Brexit agreements will be met with costly reprisals. The “unashamedly” pro-growth Truss government eyeing an election in 2024 should take note.

Yet as positions harden, so do the risks. Federico Fabbrini, founding director of Dublin City University’s Brexit Institute, lays out the potential damage of Truss’s current trajectory: a major legal confrontation with the EU (which has launched a total of seven infringement proceedings against the UK), further political instability in Northern Ireland and a firm US response. All would be detrimental to cooperation between allies — and music to Vladimir Putin’s ears. 

Against this bleak backdrop, European leaders have little choice but to pursue more constructive avenues despite the UK’s legislative loaded gun. Renegotiating Brexit is off the table, but there should be continued openness to more palatable “flexible” customs formalities if there’s a chance of ending the trade limbo. There should also be new diplomatic doors opened to the UK as an energy and defense partner in wartime facing a shared crisis. The hope is pragmatism might prevail, even in a Conservative party that defenestrated two leaders in three years.

Ironically, it’s French President Emmanuel Macron who’s making a concerted effort to appeal to Truss’s “Global Britain” ambitions despite a laundry list of grievances, from migrant crossings to raw sewage being dumped in the Channel. His administration is calling for a fresh start in Franco-British relations, and his vision of a new grouping of like-minded European democracies including the UK reflects a shifting of priorities in wartime. Though there’s been closer EU integration on issues such as defense, myriad threats ranging from war to cyberattacks to energy security require cooperation beyond the bloc’s 27 members. The UK is also a revenue source and proving ground for French industrial champions.

Ideally, Truss would grasp this opportunity to wield more diplomatic influence of her own in Europe; despite her greater interest in closer US ties, she’s openly frustrated with the not-so-special relationship she has with the Biden administration.

But the grim truth is that the catalyst for a change in UK-EU ties will probably be the severity of the looming energy crisis, rather than the smooth talk of diplomats. Economic slowdown, high inflation and energy poverty have effectively put Brexit’s sparring partners in the same boat. Truss has called this a “storm” to be overcome; as bad as that sounds, maybe it’s what will point the weather vane in a friendlier direction.

More From Other Writers at Bloomberg Opinion:

• Liz Truss’s High-Wire Plan Could Actually Avert a Recession: Therese Raphael

• Can Truss Make the Shorts Look Silly? Just Maybe: John Authers

• ECB Hawks Should Be Careful What They Wish For: Marcus Ashworth  

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Lionel Laurent is a Bloomberg Opinion columnist covering digital currencies, the European Union and France. Previously, he was a reporter for Reuters and Forbes.

More stories like this are available on bloomberg.com/opinion

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