Jonathan Saxty

Britain’s decline is relative, and is influenced by the fact that within living memory the UK was the world’s hyperpower. Decline though did not relegate the UK to the ranks of some ex-colonial powers like Turkey, but into the league of France, Germany and Japan (hardly disrespectable company). For almost all the post-war period – a few bumpy years notwithstanding – the UK never dipped below number five in the world economy rankings (where it is today). Moreover, it remains (alongside China, France, Russia and the US) one of five permanent UN Security Council members and recognised states with nuclear weapons.

The announcement that Brexit negotiations are set to continue will no doubt alarm Brexiteers who fear compromise, sell-out and fudge. In fairness to Brussels however, they set out their stall early on and stuck to the script. The EU is unwilling – as they see it – to let Britain have its cake and eat it, by having large access to the EU’s market while not being a member or leaving the club and not ‘paying a price’. This might explain what could otherwise be seen as an unduly recalcitrant attitude. It also explains why any deal which the EU agrees to is likely to be on its terms. The level playing field has proved a major source of disagreement.

Boris Johnson failed to break the Brexit negotiations deadlock over dinner with European Commission president Ursula von der Leyen last night. But while the continuation of talks suggest that neither side favours no deal, something needs to give if a deal is to be reached. It's here that Germany holds the key. France appears to be the major obstacle to a deal, particularly over fisheries, but also over the level-playing field. France and the UK have similar-sized and structured economies; both are major military powers and maritime nations. Paris is more likely than Frankfurt to threaten London’s crown.  But Germany – the ever-pragmatic manufacturing titan of the EU – will be the final arbiter of any decision.

As Brexit negotiations enter a critical stage, the EU’s eyes may again have been diverted after Hungary and Poland plunged the bloc into yet another crisis. The Visegrád Group allies have vetoed the EU’s €1.8 trillion (£1.6 trillion) budget and recovery package, responding to plans to make cash conditional on adherence to the ‘rule of law’. The move is likely to exacerbate tensions not just between central and eastern European member states and those in the West, but among Western European member states themselves. Heated debate earlier this year saw ‘coronabonds’ shelved and financial agreement reached only after concessions to the so-called ‘Frugal Four’.

The UK must not be frightened of harnessing the power of the state as the country negotiates life after Brexit. Many people who remember the 1970s – a time when the British state seemed incapable of doing anything productive while the country suffered the indignity of going cap-in-hand to the IMF – often balk at such a suggestion. Many of the same people came of age in the 1980s, and associate the private sector with growth and opportunity, while the public sector was forever tainted with the stench of poor productivity, unemployment and power cuts. Yet this Anglo-centric view misses what was going on in the rest of the world at the time.