May Picks Florence for Speech to Win EU Support for Her Brexit View

  • Prime minister will offer ‘update’ on negotiations Sept. 22
  • Hammond: EU has ‘legitimate’ fears over financial regulations

BNP Paribas Says EU Has Upper Hand in Brexit Talks

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Theresa May will take her Brexit charm offensive deep into the historic heart of Europe with a speech in Florence, as her government tries to reassure the bloc it will not use Brexit to undercut financial regulations.

The premier’s office said Wednesday she would make a speech in the Italian city on Sept. 22, arguing that Britain can still work closely with the EU after leaving. Her announcement came as Chancellor of the Exchequer Philip Hammond said he understood EU fears about the future supervision of financial markets and would try to allay them.

May and her team are taking a gentler line with Brussels, after the last round of Brexit negotiations ended in acrimonious disagreement and the next session was postponed

“The prime minister wanted to give a speech on the U.K.’s future relationship with Europe in its historical heart,” her spokesman James Slack told reporters. “The U.K. has had deep cultural and economic ties spanning centuries with Florence, a city known for its historical trading power. As the U.K. leaves the EU we will retain those close ties. As the prime minister has said on many occasions, we are leaving the EU, not Europe.”

Slack said the speech was an opportunity to “update on Brexit negotiations so far,” capping a series of position papers published in August and September.

While May’s office talks about setting the scene, European officials are looking for specifics, especially on how the U.K. will approach the question of settling financial obligations to the EU. That has been one of the key sticking points in negotiations so far.

Seeking Specifics

But the prime minister could be reluctant to give details on such a contentious subject in the fortnight before she has to appear at her Conservative Party’s annual conference. The euroskeptic party, already smarting from May’s disastrous election campaign this year, is unlikely to welcome financial concessions to Brussels.

The speech is also likely to reflect the radically altered circumstances in which May finds herself eight months after she first set out her negotiating strategy. Since then she has suffered humiliation at the hands of the voters, and cabinet members have begun openly debating the government’s negotiating options.

On Tuesday, Hammond said the government wants a “status quo” transition period after the U.K. leaves the EU with continued access to the single market and customs union. He offered another olive branch on Wednesday with a promise to reassure the EU that Britain won’t undercut financial regulations. 

“There are legitimate concerns among our EU colleagues about the oversight and supervision of financial markets here in the U.K. that are providing vital financial services to EU firms and citizens,” the chancellor told an audience of financiers at a dinner at Mansion House in London. “We will address them by making forward-leaning proposals for greater transparency, co-operation, and agreed standards based on international norms.”

— With assistance by Tim Ross

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