Brexit negotiations have been thrown into chaos as a result of the UK’s shock general election result, which did not deliver a majority for any party in the country’s Parliament.
The election, called early by incumbent Prime Minister Theresa May to bolster her slim majority backfired badly on Thursday with her party losing seats and its majority.
With Brexit talks due to begin in a matter of weeks the news throws doubt on the UK’s ability to begin negotiating its exit from the EU. May has yet to confirm whether or not she will step down as Prime Minister and it is unclear whether a new poll could be called, futher delaying talks.
The Labour party made unexpected gains under leader Jeremy Corbyn, a left-wing politician unpopular with his own MPs but commanding huge support among his party’s grassroots members. Corbyn was credited with running a far better campaign than his opponent. He has called on the Prime Minister to step down.
The shock result has caused widespread uncertainty in the City. Sterling fell around 2% following an exit poll announcement which has proven to be broadly correct across the country. the FTSE 100 was up 0.65% shortly before 10am this morning after making losses yesterday.
European politicians warned the UK that the clock for negotiations is ticking.
#Brexit negotiations should start when UK is ready; timetable and EU positions are clear. Let’s put our minds together on striking a deal
— Michel Barnier (@MichelBarnier) June 9, 2017
We don’t know when Brexit talks start. We know when they must end. Do your best to avoid a “no deal” as result of “no negotiations”. #GE2017
— Donald Tusk (@eucopresident) June 9, 2017
Key issues that will need to be resolved will include the role of London as a euro clearing centre and whether the UK will be able to continue to access key areas of the single market, such as free trade and fund passporting.