surinenglish

THE EURO ZONE

Let's be reasonable

It was a pleasant surprise this week to hear Spain's economy minister displaying common sense and pragmatism when asked about the latest Brexit news. Interviewed at the World Economic Forum in Davos on Wednesday (one of the cushiest tickets on the diplomatic calendar), Luis de Guindos reiterated that the the UK is very important to Spain economically - "perhaps our closest ally" - and that the Spanish government wants a "reasonable discussion" during the Brexit negotiations.

In her long-overdue Brexit speech on Tuesday, Theresa May confirmed that the UK will exit the Single Market as well as the EU. This prompted despair among many ex-Remainers and those Brexiteers who favoured a softer split from Brussels, so De Guindos' remarks at Davos were well-timed. And necessarily vague as they are (no-one, including the British prime minister, knows exactly how all this will pan out yet), they indicate that Brexit won't necessarily spell disaster for the half a million or so Britons living on the south coast of Spain. Unlike many senior EU politicians, who are primarily concerned with the fate of the EU project, De Guindos seems optimistic about Brexit - both for his own country and for the UK.

Jean Claude-Juncker's reaction to May's speech, on the other hand, was less sanguine: after reeling off the usual diplomatic cliches - "we want a fair deal for Britain" etc - he stated that negotiating a hard Brexit would be "very, very difficult". Donald Tusk mournfully tweeted "sad process, surrealistic times" yet also called May's proposed Brexit "more realistic".

This is an allusion to the fact that it would have been lunacy for the prime minister to expect to remain in the Single Market yet quit the EU. Indeed, it's hard to see why this was ever seen as desirable, as the UK would have been subject to a raft of economic directives and regulations over which it had zero control - the unenviable position of Norway, Lichtenstein and Iceland (members of the Single Market but not the EU). Joseph Muscat, prime minister of Malta, said that May's speech showed that the UK was not deluded about remaining in the Single Market post-Brexit. He's right about that, but he's wrong to say that the UK's status after leaving both will be inferior to that currently conferred by membership. It is far from obvious how greater economic autonomy automatically spells disaster for the UK.

Spain, at least, will be open for business after the UK quits the EU. When asked by CNBC's rambling interviewer how the UK and Spain can continue their relationship after a hard Brexit, De Guindos was pragmatic rather than pessimistic: "I am totally sure that we'll be able to find a solution, no? Taking into consideration all the elements of our economic relationship, the UK is a very important country."

Contrary to what many ex-Remainers would have you believe, this will not cease to be the case after Brexit. Spain is important to the the UK and the UK is important to Spain, so there is good reason to expect that a mutually beneficial deal will be struck over the next two years.

As regards Juncker's prediction that the forthcoming talks will be "very, very difficult" - well, they'll be just as difficult as the politicians choose to make them. But Luis de Guindos, at least, seems to want to make them as straightforward as possible.