Theresa May’s successor ‘must break Brexit deadlock’

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Brexit Theresa May's successor 'must break Brexit deadlock'

Business leaders fear Conservative leadership contenders will back no deal

This week JPMorgan raised the probability of a no-deal Brexit to 25% from a previous estimate of 15%, saying its base case is Boris Johnson becoming PM. Photograph: Andrew Yates/Reuters

Business leaders have warned that Theresa May’s successor must table an immediate plan to break the Brexit deadlock, amid mounting concern that candidates in the Conservative leadership contest will back a no-deal withdrawal.

Adam Marshall, the director general of the British Chambers of Commerce, said MPs had already squandered too much time going around in circles on the departure deal, causing harm to the economy as the latest Brexit deadline of 31 October approaches.

“Any leadership contest must be swift and followed urgently by a clear plan to break the impasse. The clock is still ticking down to 31 October, regardless of who is in Downing Street. A new prime minister must work to avert a messy and disorderly exit from the EU,” he said.

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Carolyn Fairbairn, the director-general of the CBI, Britain’s most powerful business lobby group, said that May left office with the respect of corporate leaders for pursuing a deal that would protect industry but said her resignation must be a catalyst for change.

“There can be no plan for Britain without a plan for Brexit. Winner-takes-all politics is not working. Jobs and livelihoods are at stake,” she said.

The pound has sold off sharply over recent weeks as May’s fate became increasingly clear, reflecting growing concern that her replacement could pursue a no-deal Brexit that would damage the economy. Sterling rose slightly on Friday after May said she would resign on 7 June.

Timeline

Theresa May resigns – what happens next?

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Theresa May announces she will step down on 7 June. Tory leadership hopefuls immediately begin jockeying for position.

The European parliamentary election results to be announced, with the Tories expecting a disastrous result for the party. Some MPs have even suggested they may end up with no MEPs, with polls showing Conservative support to be under 10%.

Donald Trump will arrive in the UK for a state visit. The US president, not known for his tact, will be spending time with the outgoing prime minister and the royal family during his visit.

The 75th anniversary of the D-Day landings will see May, Trump and other world leaders gather in Portsmouth and Normandy.

Theresa May will formally resign as Conservative leader – officially triggering a leadership contest.

Conservative MPs will whittle those standing to be leader down to two candidates in a series of votes overseen by the 1922 Committee. After each vote, the lowest-ranked candidate drops out of the race, until two contenders remain.

A ballot of the 120,000 or so Conservative party members will choose between the final two candidates. All polling of grassroots Tories suggests that were he to be on the ticket, Boris Johnson would most likely win.

The new leader will attend their first Conservative party conference as the prime minister.

The UK will leave the EU without a deal, unless parliament and the new PM have either passed a withdrawal agreement, accepted another article 50 extension from the EU, or revoked article 50 altogether.

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Over recent days Sterling has suffered its longest losing streak against the euro since the creation of the single currency two decades ago, plunging on the international money markets.

Having recorded the steepest losses among major world currencies in the month of May, the pound has dropped from more than €1.17 versus the euro to less than €1.14 and has slid from more than $1.32 against the US dollar to less than $1.28 – the lowest level since February.

This week the US investment bank JPMorgan raised the probability of a no-deal Brexit to 25% from a previous estimate of 15%, saying its base case is that Boris Johnson becomes prime minister. It also said there could be a general election as well as another delay to Britain’s planned withdrawal from the EU on 31 October.

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Although Johnson has recently begun to tack closer towards the centre ground over recent days in an attempt to win over more moderate Tories for his leadership push, his previous stance has alarmed business leaders.

The former foreign secretary was reported to have said “fuck business” when asked about industry concerns over Brexit last year. Johnson is viewed as the frontrunner to replace May.

David Owen, the chief European economist at the US investment bank Jefferies, said: “So much will depend on not just who becomes the next leader of the Tory party and prime minister but the team that is appointed. A senior team comprising ‘One Nation’ Tories would be very different to that comprising ultras.”

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