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Theresa May quits as prime minister – but UK’s Brexit woes continue

Departure puts a 'no deal' scenario firmly back on the table

The trajectory and timing of the UK’s departure from the EU has been thrown into fresh confusion with the resignation today of UK prime minister Theresa May.

May’s departure as prime minister had long been expected, in the wake of her failure to push a Brexit deal through Parliament, after almost three tortuous years of trying. But her imminent departure and replacement by a new prime minister mean that almost all possible Brexit options are once again back on the table.

And EU leaders will be in despair at the realisation that much of the extension period offered to the UK to evolve a coherent Brexit plan - following their decision in April to push the deadline for the so-called Article 50 process back to October 31 - will now be taken up with a potentially lengthy election process for a new Conservative Party leader .

May announced on Friday that she would actually step down as party leader in two weeks’ time, on June 7. This means she remains in office for the state visit of US President Trump to the UK in the first week of June.

But it could be the latter part of June before May’s successor is finally elected and takes office. Nominated candidates are eliminated one-by-one in a series of votes by Conservative MPs, with the winner chosen from a straight choice between the last two candidates standing by the whole 120,000-strong Conservative party membership.

Boris Johnson in pole position as successor

The favourite to succeed May is former foreign secretary Boris Johnson, who is immensely popular among party members despite failing to impress on the international stage in the two years between his appointment as foreign secretary immediately after May came to power in 2016, and his resignation in protest at the ill-fated EU-UK Withdrawal Agreement last summer.

Most pundits expect the next Conservative leader to take a harder line on the Brexit issue than May, who worked hard to find the fine line between keeping the UK economically close to the EU but politically separate from it – and who ultimately paid the price for her failure to do so.

Many senior government figures support a ‘softer’ Brexit – notably finance minister Philip Hammond – but their support base among the party faithful may be inadequate to stave off challenges from ‘harder’ Brexit contenders such as Johnson.

However, the difficulties in making Brexit a reality will not go away, whoever is elected as the next prime minister.

‘No deal’ returns to the table

The option of a no deal Brexit – whereby the UK simply pulls out of the EU without any kind of free trade agreement in place – is very appealing to those whose patience with the seemingly interminable Brexit process has worn thin.

The government (and the European Commission) have made extensive provisions for this eventuality, including the publication of an ‘emergency’ tariff schedule

 Boris Johnson has frequently voiced his support for such a move, and indeed, a no deal Brexit remains the legal default option if there is no agreement to act otherwise by November 1.

However, in the current UK parliament there is a clear majority of MPs against a no-deal Brexit – although there is also no majority for virtually any other Brexit option – so the new prime minister may well be obliged to call a general election in a bid to break the parliamentary stalemate.

This however runs the risk of the current minority Conservative government being replaced by a Labour administration led by the hard-left Jeremy Corbyn.

A Eurosceptic leader of a predominantly Europhile party, Corbyn is likely to be more open to the option of a European Economic Area (EEA)-style relationship with the EU, with Britain forming a customs union and participating in the Single Market. The Labour leader is also likely to come under pressure from his party to submit any final Brexit deal to a second public referendum.

Clock still ticking towards October 31

There remains, therefore, no clear pathway towards a final Brexit settlement for a country which remains as deeply divided as ever over the whole issue of its relationship with the EU.

Few would bet against the prospect of the UK asking the EU for yet another extension of the Article 50 process as the new October 31 deadline draws nearer. This time around, with French patience with the UK’s travails now wearing especially thin, it is far from a foregone conclusion that the EU would grant such a request.

The options for UK and EU agribusiness thus remain as broadly drawn as ever – with a no deal Brexit, a negotiated settlement, or a revocation of the entire Brexit process all remaining possible outcomes.

The sector’s frustrations were neatly encapsulated by Tim Breitmeyer, President of the UK Country Land and Business Association:

“The upcoming leadership contest will not alter the political arithmetic however and the Brexit deadline of 31 October still looms large. While the focus of the Westminster bubble may shift, rural businesses will be looking on concerned that progress towards reaching a workable agreement with the EU has stalled,” he said in a statement today. 

“Whoever emerges as Prime Minister will need to build a future relationship with the EU which offers as free and frictionless trade as possible and continued access to labour. Allowing the next five months to drift towards a ‘no deal’ Brexit, with its immediate barriers to trade, is a scenario we need to avoid,” Breitmeyer concluded.

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