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Following Through

Published: May 09 , 2019
Author: Stephen White

‘Nothing is agreed until everything is agreed’. This guideline, part of Article 50 of the Treaty of European Union*, has been a continuous soundbite during the Brexit negotiations. But two other international negotiations which were in the news this week reveal a different gloss on this guideline, which although it might seem both logically and morally right can be much more flexible than at first sight.

Firstly the US-China trade negotiations. All was going well with both sides seemingly moving towards an agreement. Then unexpectedly, early this week, the US  threatened further major tariff rises on Chinese goods to be implemented tomorrow (Friday). The reason for these threats was that last Friday Washington received from Beijing a revised draft of the agreement – 150 pages of it – littered with Chinese reversals and backtracks. These mainly related to demands made by the US negotiators (and apparently agreed in principle by the Chinese negotiators) on issues such as IP theft and compulsory technical data transfer; demands which require changes in Chinese law to be effective. The revisions removed the legal status of these changes, because of Chinese claims that new legislation will take years to enact. The US negotiators were not amused.

Secondly, the Iran nuclear agreement of 2015 was back in the news. Having been party to the agreement under Obama’s presidency, the US decided in 2018 that it didn’t like the deal, withdrew from it, and re-imposed sanctions on Iran which have had a major economic effect. The other original signatories to the agreement, including the UK, have kept faith with it, at least superficially, but not sufficiently for the Iranian authorities, who are now threatening to back-track on parts of the agreement, specifically those which prevented Iran from enriching uranium to weapon-grade strength.

What do we learn from these two examples? In the US-China case, it becomes clear that the Chinese negotiators were prepared to try their hand at reopening elements of the deal which the US thought were agreed. In doing this they calculated that the worst that could happen was that they would be brought back into line by US sanction behaviour; even then they might get to improve some bits of the deal (from their perspective), so there was little to lose. The only way for the US to stop this behaviour was to retaliate. And I’m sure that tomorrow we will see that they will. In the Iran Nuclear agreement, the US didn’t threaten to pull out or shout about pulling out. They just pulled out. The better soundbite for their behaviour is ‘Nothing is agreed even after everything is agreed’. (They have form in this respect in terms of the Paris Climate Change Agreement too). If one side really doesn’t like a deal which it has signed off then pulling out is still an option. Compare that with yesterday’s comment in a press conference when UK Foreign Secretary Jeremy Hunt said that ‘if the Iranians break the deal there will be real consequences’. I’m sure the Iranians are trembling.

So – don’t threaten to do it unless you are prepared to demonstrate that you will do it. That is, of course, if you have power! Or at least you are confident to manifest power. And in referencing these two examples back to Brexit that is surely where our negotiators went could have done better. Not that we didn’t shout at the EU negotiators loudly enough, or threaten monstrously enough, or swagger. But that we didn’t follow through.

 

 

 

*The text actually reads as follows: Negotiations under Article 50 TEU will be conducted in transparency and as a single package. In accordance with the principle that nothing is agreed until everything is agreed, individual items cannot be settled separately.


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About the author:

Stephen White
My background is sales and marketing. I read Law at University and worked for 2 major packaging companies for 13 years in sales and sales management. I joined John McMillan and Scotwork in 1984. For the next 25 years together with our colleagues we delivered training and consulting, built the global business and developed the Scotwork product portfolio.

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