Some reflection on EU thinking on the next phase from Eurasia Group.
‘... bottom line, for now, is that keeping "UK in the continental orbit" will underpin EU's approach & objectives in phase 2. One senior official tells me: "We want to keep the UK in the continental Europe's orbit. We don't want to lose the UK. This will have a big impact on where the EU will be in 10-15 years, between the 2 poles of the US & China." This objective will impact architecture & approach. There's some discussion (& has been before) of an "umbrella architecture", at leader's level, that will meet twice per year.
There will be a co-ordinating body, that works on a limited number of agreements. 1) Trade/FTA; 2) Foreign/security policy; 3) Research/Erasmus/Verizon etc. "There will not be 120 bilateral deals" like Switzerland. This is to avoid complications, but also because EU side is considering an interdependent negotiation between the various, limited, layers. So if UK wants to diverge, "to be a competitor", then this *won't only* hinder access to Single Market, but will also impact co-operation/access via-a-vis the other levels too. As one senior official tells me: "We want leverage in these areas" to try & keep UK as close as poss.
This could also give UK leverage over its strongest card - defence. But what's clear is thinking on EU side regarding phase 2 is quite mature, and Commission & MS have already done a lot of work on negotiating structures’