Theresa May's Brexit: metaphorically speaking

The optics were not good. No, not an eye-drop, or a dram measure in your pub gantry. That's politico-speak for the way it looks on telly.

The flat backdrop obliterated a magnificent example of London's neo-classical architecture with a flat, grey, washed-out world map. The Prime Minister's body obliterated Europe, and the words "Our New Partnership" were located on the northern shore of the Caspian Sea.

It wasn't meant to be like this. Theresa May would have delivered this vital speech on Brexit in a more northerly location, closer to those Brexit voters than in London's Mansion House.

But there, again, the Prime Minister was assailed by metaphors. Her speech fell on a day when much of Britain has been paralysed by a pincer movement of storms from the east and the south-west. She couldn't get to the north.

Britain's gas supply had just been stretched to the limit. The markets were being rattled by a global protectionist war being declared by a trade-trigger-happy US President.

The gods seemed to be sending Mrs May a message or two about the task in hand and the wider context of competing pressures for government attention, as she set about explaining how Brexit is going to work.

Neighbours and allies

Many of the finest brains in Whitehall have been absorbed with trying to square a circle around the question of the Northern Irish border.

So they have less time to think about building wider energy markets, combating protectionism or the impact of climate change on the weather.

The reward for Brexit, according to international trade secretary Liam Fox, is a glorious new dawn of trade deals with the world beyond Europe.

Donald Trump was one of the first to tell Theresa May he would like to do a deal on trade with the UK. Naturally, it would be the best kind of trade deal.

What is now clear, and always has been, is that the US president has his electoral base in mind. The implications of tariffs on steel and aluminium exports are lost on him, when his focus is on his promise to the steelworkers of (vital electoral states) Ohio and Pennsylvania that he'd protect them.

No matter that it will hit neighbours and allies Canada, Brazil, South Korea and Mexico far harder than China, the source of much of the world's over-capacity for steel.

Nor has it penetrated the Oval Office that tariffs push up the price of metal for industries which use them in the US, such as the car-makers.

Nor does it seem to have bothered the President that he can expect retaliation. The European Commission is on the case, reported by Reuters to have a list ready of $3.5bn worth of items that it will target. South Korea is already in dispute over US trade measures.

And Britain, which annually sells £360m of steel to the US, 15% of its exports?

Well, President Trump is not a subtle negotiator of win-win deals. He likes to beat others, and to see them lose. His loyalty to allies isn't looking like this week's priority. And he can probably sense Dr Fox's need to get quick results, which is never a good position from which to enter negotiations

In the pipeline

What of that Gas Deficit Warning, as 1 March demand spiked at 31% higher than the norm for this time of year?

This is also a story of international trade, at a time when Britain is pulling away from closer integration with the European energy market.

The good news is that the warning worked. It was an invitation to big gas users to cut back on usage, for which there's a financial incentive. They duly did so.

Not so good is that Britain is getting more dependent on imported gas. It was a net exporter until 2004. It now looks to imports to meet 47% of demand. In ten years, that looks like 61%. By 2035, says the Oil and Gas Authority, 73%.

There was a big wake-up call across Europe when Russia first turned off the taps on its pipelines, to throw its weight around with its neighbours. A lot of work went into diversifying supply, much of it from Norway.

Britain also developed the capacity to handle LNG, or liquified natural gas, brought by tanker from Qatar and now from the United States.

That puts gas into a global market, rather than on a contract at the end of a fixed pipeline. At NewsBase, an Edinburgh supplier of energy market intelligence, Ryan Stevenson tells me that this time of year brings competition for those same tankers to dock in Japan or Korea.

His analysis shows the underlying wholesale gas price having risen 30% for UK customers in the past two years.

That's as they compete with electricity generators who have lost baseload coal burning, and have to turn to gas for a back-up supply when the wind drops.

The longer term could see Europe's gas burning power stations also cut back. But for now, the boiler stays hot. And with a big reduction in Britain's ability to store gas, with the recent closure of the Rough offshore facility, we can expect more price spikes when there are winter cold snaps.

If the climate scientists are right, we can also expect more winter cold snaps.

Divorce talks

What, though, of that speech? It had different audiences: Brexiteers who continue to think that Britain can force the EU to give in to all of London's demands, being told there might have to be some hard choices and compromise: and European negotiators, who were portrayed by the premier as being much more flexible in other trade negotiations than they appear willing to be with Britain.

That suggests that other negotiations have been like the Brexit ones. But as the Prime Minister also pointed out, other talks were about finding common ground on which to become closer, while Brexit is about a parting of the ways.

Britain is in divorce talks, from a European club where the members feel affronted and defensive as their founding principles are rejected by Westminster.

Mrs May moved forward with more detail on many fronts, including the industry sectors she wishes to prioritise. Don't tell me not to cherry-pick, she told the EU. Every negotiation is about cherry-picking. Every trade deal reflects the importance of particular sectors for the signatories.

Goodwill and trust

Fisheries was one of those included; control of British waters, a deal to allow access to European boats, and continued access to sell products into EU markets.

Pharmaceuticals is an area where Britain punches above its weight within Europe, and she could argue that the European Union need Britain to help bring new medicines to its own people. Why wouldn't we all co-ordinate on aerospace?

She acknowledged the complexity of supply chains built up within an integrated, barrier-free European market. She acknowledged also that trade cannot be as smooth in future as it has been.

But the few solutions she put forward tended to raise more questions. The Irish border question was answered with a familiar set of ideas. When goods come into the UK, they should be certified as bound for an EU destination or a UK one.

They'd have to meet different sets of regulations, and could be charged tariffs at different rates.

A trust system would then apply as they moved through the UK, between Ireland and the European continent.

But that's just for big firms and big trucks. For the majority of small businesses that trade across the Irish border, the proposal is to let them continue as they have done, and not to be too bothered if it means a leaky frontier for either the EU or the UK regulatory or tax regimes.

Again, trust is required.

As one trade association commented, this British solution depends on technology and goodwill, when neither seem to be guaranteed in the timeframe set out.

The other key element of the Prime Minister's pitch to the European 27 is on alignment. The offer is that Britain will seek to align with EU regulations, but on condition that Westminster can diverge from them if it wants to.

MPs would be aware of the consequences of doing so, implying that the European Union would close down co-operation. So this would not be something done lightly.

Yet the pressure to diverge from apparently daft, petty-fogging Eurocratic rules was precisely the red meat on which Euroscepticism was fed, through politicians and newspapers.

This is one part of the pitch that doesn't sit comfortably with at least one of the five guiding principles that Mrs May set out as key to getting a deal - that the future EU-UK relationship should be stable.

While Dr Fox is off negotiating trade deals with the US and others, the demands of American and other foreign industry groups, to diverge from the EU's rules on, say, food safety, puts immediate pressure on that voluntary EU-UK alignment.

In questions afterwards, one French journalist seemed to speak for the continent with a voice of puzzlement: if all this negotiating complexity is required in order to serve British trading interests, then is Brexit really worth it?

It's what the people voted for, came the reply.

The boss of Virgin Money, Jayne-Ann Gadhia, was also there, saying she runs a bank based in Scotland and Newcastle. What, she asked, is in the Brexit deal for people in those parts of Britain.

The Prime Minister gave an answer; a stronger economy, financial technology, innovation and upskilling workers.

It was an answer, but as so often in the Brexit debate, not to that question.

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