One
has to wonder whether Boris Johnson is not already squandering the golden
opportunity his recent large election victory gave him to put the UK on a
sounder economic footing. One also has to wonder what he might have learnt from
the UK’s painful 3 ½ year negotiation of a Brexit Withdrawal Deal with its
European partners.

After
resoundingly winning last week’s election, Mr. Johnson is now seeking
parliamentary approval of legislation that would preclude the UK from asking
for an extension of the December 2020 end-date for its transitional arrangement
with the European Union.

This
leaves Mr. Johnson with very little time to negotiate the UK-European Union
free trade arrangement that he is seeking even though such free trade
arrangements typically take a number of years to negotiate.  By so doing,
he is also raising the possibility that at the end of 2020 the UK could crash
out of Europe without a deal.

Over
the past three years, the prospect that the UK could crash out of Europe has
been highly unsettling for investors and has pushed the UK economy to the brink
of an economic recession. Now rather than assuring investors that he would use
his large parliamentary majority to engage in an orderly negotiation with his
European partners on a future trade arrangement, Mr. Johnson is bound to have
again unsettled investors by reigniting fear that the UK could crash out of
Europe at the end of 2020.

Mr.
Johnson’s decision to preclude an extension of the deadline has also given
undue leverage to the Europeans in the forthcoming free trade negotiations.
With the knowledge that Europe accounts for 50 percent of the UK’s export
market and that the UK has set a self-imposed deadline for the negotiations,
the Europeans can once again be expected to run down the clock in the
forthcoming negotiations and squeeze concessions from a UK all too desperate
for a trade deal.

Mr. Johnson is not known for keeping his word. Earlier this year, he asserted that he would rather die in a ditch than seek a Brexit extension before being forced to ask for such an extension. One can only hope that Mr. Johnson reverses his no further extension policy stance soon, before the prospect of a no-deal Brexit again exerts a heavy toll on the UK’s economic performance.

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