No margin for Eire

7 June 2018 By George Hay Follow @gfhay

Britain has proposed a backup plan for avoiding a hard border in Ireland when it leaves the EU. Characteristically, it fudges how long the plan will last, and it still needs Europe to agree. Investors wondering whether Brexit will be mild or ruinous still have little to go on.

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The British government on June 7 set out its plans for a one-year “backstop” plan to avoid a hard border between the Republic of Ireland and Northern Ireland after the UK leaves the European Union.

The "temporary customs arrangement" would see the whole United Kingdom remaining aligned with EU tariffs and regulations if the two are unable to agree a trade deal after Britain leaves the EU in March 2019. The backstop would apply after a two-year so-called implementation period, in which the UK has already agreed to abide by EU rules.

The document stated that the UK was “clear” that the temporary customs arrangement, should it be needed, should be time limited. It also said that the UK expected a future trade deal to be in place by the end of December 2021 at the latest.

Sterling was trading at $1.3391 as of 1434 GMT, down 0.2 percent, having hit $1.3469 earlier in the day.

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