Brexit trade talks have been stalled as a result of the coronavirus pandemic, but former MEP Ben Habib claimed that the economic turmoil that has ensued may give the UK control in talks.
This is because, while the UK grapples with its own economic dilemmas, many countries in the EU are facing recession as lockdowns halt activity. Writing in a Daily Telegraph column last month, former Brexit Party MEP Ben Habib said: “As awful as the virus is, it strengthens the UK’s hand in negotiations.” As Mr Habib highlights, some of the EU’s biggest economies had already been struggling before the pandemic brought with it further damage. He said: “It will soon be revealed that the eurozone is in a deep recession and that the steps taken by those countries to combat the virus is going to leave many of them bankrupt.
“They entered this crisis over leveraged with many governments carrying debt burdens north of 100 percent of GDP and high levels of unemployment, particularly in the youth.
“These debt levels and unemployment rates will now rise dramatically, including that of Germany’s.”
Last month, economist Julian Jessop echoed these claims, highlighting how the coronavirus has left eurozone nations divided.
He said “If the eurozone as a whole is providing a lot of support for an individual country, that means Germany is effectively bailing out Italy, which is great if you are Italian but not if you are German.
“That has always been the problem. If you have a single currency and a single monetary policy, that is only sustainable if you have got a single fiscal policy and banking policy and other things.
“You are either all in or all out. The direction of travel is either that the euro breaks apart or that there is much more closer integration amongst eurozone members.
“This would include common fiscal policies and effectively common governance which is why I think it is good that we are out of it.”
Mr Habib argued that the economic woes in Europe could help the UK secure a more favourable trading arrangement with the EU.
He said that while the UK faces its own challenges, it goes into the crisis with lower debt, low unemployment and benefits from having its own independent currency.
Meanwhile, Europe’s already low interest rates have left it with little wriggle room to stimulate its economy.
Mr Habib added: “The EU is now in no position to do anything but to give the UK a good trade deal and cease its ridiculous demands for the UK to remain locked into a level playing field with its restrictive burdensome regulatory set up.
“We must press home this advantage. We should not shamelessly exploit it to the detriment of Europe but we must use it to get a Canada style free trade deal – another one of the Prime Minister’s promises.”
Brexit trade talks have resumed this week, with the deadline remaining at December 31 after the Government confirmed no extension would be taken.
British chief negotiator David Frost and European counterpart Michel Barnier talked via video link.
Mr Frost had been self-isolating after showing symptoms while Mr Barnier tested positive for the coronavirus in March.