Paschal Donohoe. Photo: Thierry Monasse/Getty Images
Eurogroup chief Paschal Donohoe has expressed optimism about the prospects for a major reset in UK-EU ties, even as Britain’s new prime minister, Keir Starmer, stresses he has no plans to reverse the main choices of Brexit.
“It is extremely possible – and I want this to happen – that there will be a big improvement in, not just the tone, but the nature of the relationship between the UK and the EU,” Mr Donohoe told Bloomberg in an interview last week.
He added that he was going to London in September to play his part in improving ties with Labour in the wake of Mr Starmer’s landslide election victory last month.
Mr Donohoe, who chairs the eurozone’s meetings of finance ministers and also serves as Ireland’s minister for public expenditure, separately told Bloomberg Radio that the prospect of a second Donald Trump presidency provided a fresh impetus for the European Union to make its economy less dependent on the US.
The UK election on July 4 returned Labour to power after more than a decade on the opposition benches, including the Brexit vote in 2016 and the country’s subsequent exit from the EU’s common market. Although Mr Starmer once opposed leaving the bloc, he has repeatedly sought to reassure those who supported leaving that he is focused on improving the relationship rather than relitigating Brexit.
Mr Starmer hasn’t singled out any special measures for the financial services sector, which employs about 2.5 million directly and in related professional services, according to the treasury and the City of London Corporation latest annual report on the industry.
Something that hasn’t materialised since Brexit is an “equivalence” deal that would allow for reciprocal access between London and the EU. London-based firms have since moved thousands of staff to offices across Europe, with Dublin as most popular destination for staff relocations and offices, according to EY.
In his comments on the UK, Mr Donohoe played down the chances of big policy changes. The most likely development was a “number of medium-term projects between the UK and the EU that would lead to a huge improvement in the tone of the relationship,” he said.
“The City of London has continued to demonstrate great resilience in its ability to withstand the Brexit shock better than expected,” Mr Donohoe said.
