Howard Davies takes Europe's temperature on Brexit

MT's diarist takes a grand tour of the continent before the borders shut.

by Howard Davies
Last Updated: 13 Oct 2016

I have always rather liked blue channels, especially late at night after a long day. I refer, it goes without saying, to the EU-only routes out of baggage reclaim at Heathrow. Quite what the significant difference is between the blue and the green, nothing to declare, channels is, when both are normally unpersonned, I could not say. But the blue channels have always seemed to me to be costless little tokens of friendship to our Eurochums, in a country where the blue flag with 12 gold stars has never taken root.

So before they are removed, in favour of tunnels of death between rotating knives, I went on an Indian summer tour of European capitals. For the time being, you still don't need visas, but if the pound continues on its downward slalom through the winter we will be priced out of them anyway before too long.

First stop was Vienna. Pre-referendum pan-European opinion polls showed that the Austrians were the nationality keenest to see the tiresome Englisch pack up their troubles and leave the EU behind. So I mainly avoided the B word and concentrated on seeing a lot of wonderful pictures, eating some deliciously unhealthy sausages, and drinking rather too much of their tasty red wine. The principal local grape is the Zweigelt, an assertive little hybrid created by the head of their wine institute in the 1930s. Fritz Zweigelt was an enthusiastic and never-repentant Nazi. It is as if our patriotic Surrey vineyards proudly branded their vin rouge as Mosley red.

I didn't find any vinho Salazar in Lisbon, my next stop, and they have changed the name of his bridge across the Tagus, but we stayed in an Airbnb apartment opposite an elaborate statue cum fountain built to celebrate his fascist New State, with evident hints of Strength Through Joy in its design. Lisbon always has the air of being perched on the edge of Europe, at risk of dropping off one of these days, though they are unmoved by the departure of their oldest ally.

In the autumn, the city has a lot going for it. Fresh Atlantic air, and Mediterranean-quality beaches little more than 20 minutes from downtown. You need to select your restaurants with care, but those American investment bankers thinking of relocating away from the Brexited square mile could do worse than consider it. The price is right, too. Their dollars go a long way.

Then on to Dublin. I was briefed for my trip by James Joyce, or at least by the Irish actor who plays him in the new production of Tom Stoppard's Travesties. That gave me huge street cred by the banks of the Liffey. The Irish can't quite decide if the UK's decision to sling its hook, and leave them as the only English-speaking nation in the EU, is a problem or an opportunity. The border issue looms large, and of course freedom of movement between the two countries dates back to 1922. Some kind of special deal will be needed to preserve that convenient anomaly. No one quite knows how that can be negotiated. If you wanted a logical arrangement you wouldn't start from here.

On the other hand, they are besieged by financial firms asking how quickly the regulators will allow them to move in. There isn't, unfortunately, anywhere in Dublin available to live. At least there are very few spare homes with underground swimming pools and cinemas, which no self-respecting hedgie can live without these days. Anyone who could find a way of putting a Kensington basement on a truck to Milford Haven and across the Irish Sea would make a killing.

In Paris there are no mixed feelings about Brexit, though some linguistic purists are sorry that they don't have their own word for it. 'Bsortie' doesn't quite work. All those witty Johnsonian jokes about rolling out the tapis rouge in Lombard Street for French bankers in exile, which used to have them rolling in the aisles in Davos, don't have quite the same ring these days. The botte is on the other pied.

The Mayor of Paris has set up a special unit to lure financiers home with tax holidays, special flexible labour contracts and a year's free supply of pains au chocolat. Some might just be tempted.

Brussels, by contrast, has a wary feel to it these days. We are in a period of phoney war. Officially, no one is allowed to talk about Brexit, but of course no one thinks of anything else. Some see it as a useful warning shot across the bows of the Eurofederalists and the Commission's ideologues. Others see it, by contrast, as a shot in the arm for them, and an opportunity to make another Great Leap Forward in constructing the European superstate. A third current of opinion notes that the 27 will be consumed by the divorce process for years, while there are other pressing matters to resolve. A fair point. Even amicable divorces end up in legal arguments.

In Stockholm, my last port of call, they don't expect to profit from our departure. Indeed the Swedes are touchingly sad about the whole story. They talk glumly into their Aquavit of bidding farewell to one of their most sympathetic allies in Brussels. Who will now raise the standard of free trade and liberal markets, tease Tusk and make jokes about Juncker? But will they go so far as to join us in our quest for new horizons? Nej, was the (almost unanimous) answer. We must sail alone away from the blue moon and into the setting sun, without so much as a Viking longboat to accompany us.

Howard Davies is chairman of RBS. Follow him on Twitter


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