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Hammond and Davis should expect strong headwinds from Berlin during pursuit of bespoke Brexit deal

Chancellor Philip Hammond and Brexit Secretary David Davis. Credit: PA Wire

When British students are taught the history of their country in the 19th Century, the theme is ‘Splendid Isolation’. The same lesson on the continent comes under the heading ‘Perfidious Albion’. Britian’s century of standing aloof from Europe’s affairs is seen abroad as a time of ‘divide and rule’, and it has left them suspicious of British policy ever since.

It is in this context that the EU27 resolved that - whatever else came to pass during the Brexit negotiations - divide and rule was not going to work. They would speak as one through Michel Barnier and the Commission, attempts to split off a country here, a small group there would not work.

And they have stuck to that ever since June 2016, but London has not given up trying. This morning in a joint letter to a major German newspaper, Philip Hammond and David Davis have appealed directly to German public opinion to allow the UK a special deal on Financial Services post-Brexit. And this just a day after Michel Barnier explicitly ruled out any sort of special deal for the City of London.

It will be seen in European capitals as classic divide and rule, and I suspect it will have a negligible chance of success. Even if Berlin bought British arguments that the City is great asset for Europe as a whole, and that it is important to keep the London markets fully engaged with those on the continent to avoid another 2008-style crisis (which they don’t), their overriding priority remains the integrity of the single market and EU unity.

The flags of the EU, the UK and Germany. Credit: PA Wire

Bear in mind too that many in Berlin, not to mention Paris and further afield, have long been suspicious of the power of the City, while at the same time coveting its riches. There is vigorous competition between Frankfurt, Paris, Amsterdam and others to win a share of the expected exodus from London, with the jobs and tax revenues that will come with it. It is quite hard to see why politicians there should suddenly feel the need to block the goodies coming their way and ensure they stay on this side of the Channel.

Philip Hammond is talking to an economic conference in Berlin today, while David Davis is in Munich tomorrow. If this is a co-ordinated effort to woo German opinion, they should both expect some pretty strong headwinds.

When David Davis last tried this, in Berlin at the end of last year, his words engendered more laughter than applause. His audience were baffled by his praise for many of the EU’s institutions and achievements, while at the same time insisting the UK had to be rid of them.

Michel Barnier, in Brussels, is unlikely to be undermined from a Berlin that still doesn’t have a Government, and may need a fresh General Election before it gets one.

In the meantime he is being serenaded today by a delegation of pro-Brexit Britons, led by UKIP MEP Steven Wolfe and former CBI chief Digby Jones. They arrived bearing gifts. English wine and cheese. Michel Barnier, of course, is a Frenchman.