The National Today

Brexit fears mount with no deal yet to leave European Union

A closer look at the day's most notable stories with The National's Jonathon Gatehouse.

Newsletter: A closer look at the day's most notable stories

British Prime Minister Theresa May is trying to downplay talk about stockpiling food in case a Brexit deal can't be reached before the U.K.'s departure in March 2019. (Leon Neal/Reuters)

Welcome to The National Today newsletter, which takes a closer look at some of the day's most notable stories. Sign up here and we'll deliver it directly to your inbox Monday to Friday.

TODAY:

  • Dire warnings about post-Brexit life are being delivered on an almost daily basis since British Prime Minister Theresa May's plan for a "soft" withdrawal from the EU provoked a revolt within her party.
  • Mark Zuckerberg lost almost $20 billion on Wednesday afternoon, but he still didn't fare as poorly as his company. Why all this is happening at Facebook is a bit harder to explain.
  • Maybe the Korean War is about to end. It seems the two Koreas are targeting the annual United Nations General Assembly in September as the time and place to sign a treaty bringing an official end to the 68-year-old conflict.
  • Missed The National last night? Watch it here


Fear fills the Brexit void

Britain's exit from the European Union is now 246 days away, and in the absence of a deal — or even an agreed-upon plan — fear is filling the void.

Nathalie Loiseau, France's minister of European affairs, revealed some of her country's preparation for the "brutal divorce" of a no-deal Brexit next March 29, warning that it will cause chaos at Calais and other Channel ports.

"On the day of the United Kingdom leaving the European Union with no deal, we should start with new tariffs, controls and that means of course traffic jams in Calais and in each and every European port welcoming goods and people coming from the United Kingdom," she told BBC Radio Thursday. "We would all suffer. The worst would be for the United Kingdom."

The pointed warning comes a day after Theresa May's government admitted that it has begun to stockpile food and vital medicines in case a deal with the remaining 27 members of the EU can't be reached.

Dominic Raab, the new minister in charge of Brexit, has explained it as a "technical" exercise to make sure that supermarket shelves remain fully stocked, pledging that there will be "an adequate food supply." The prime minister herself has suggested that such preparations should be a "comfort" to Britons.

"I would say that people should take reassurance and comfort," she said in a televised interview Wednesday night. "We don't know what the outcome is going to be, we think it's going to be a good one, we're working for a good one, but let's prepare for every eventuality."

The dire warnings about post-Brexit life are being delivered on an almost daily basis since May's so-called Chequers plan for a "soft," transitional withdrawal from the EU provoked a revolt within her Conservative party and saw several key ministers resign.

Boris Johnson was one of the ministers who resigned from the U.K. government over May's attempt to negotiate a 'soft' Brexit. (Dan Kitwood/Getty Images)

A number of large corporations, like Rolls-Royce, Jaguar Land Rover and Siemens, have raised the spectre of factory relocations and mass layoffs. And earlier this week, there were reports that the head of Amazon's U.K. operations has told the government that the company believes there could be "civil unrest" within two weeks of Brexit, and is planning accordingly.

Pro-Brexit forces believe that it's all part of an orchestrated campaign, and have taken to referring to the talk as "Project Fear 2.0" — a reference to the Remain side's unsuccessful attempts to convince Britons to stay in the EU during the divisive 2016 referendum campaign.

But it might be working.

Today, there are reports that Angela Merkel, the German chancellor, is trying to broker a September summit meeting of EU leaders, where May will be able to directly sell her plan and bypass the Brussels bureaucracy. It's a potentially face-saving way out of an increasingly fraught relationship.


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A bit of perspective on Facebook

In the course of a couple of hours Wednesday afternoon, Mark Zuckerberg lost almost $20 billion.

But he still didn't fare as poorly as his company.

Facebook CEO Mark Zuckerberg has had to address a number of controversies in recent years, including the role this site played in possibly swaying the 2016 U.S. election. (Andrew Harnik/Associated Press)

After a disappointing earnings and growth report, Facebook shares dropped more than $40 apiece from a near all-time high of $217.50 US to $174.89 at the beginning of Thursday's trading, shaving more than $100 billion off the tech giant's market cap. Which adds up to the biggest single-day drop ever for a U.S. firm.

So far Thursday, there has been a slight recovery, with shares trading at $177.75 at midday. But that's still below analysts' new target price of $183.

Why this has all happened is a little harder to explain.

Facebook has been suffering awful publicity since its role in Cambridge Analytica's attempts to influence elections came to light last winter. Governments around the world have been threatening to regulate the social media platform, and Zuckerberg himself has had to testify before the U.S. Congress.

And as this analysis notes, the underlying numbers weren't actually that bad. Facebook has been warning investors of an approaching slowdown in growth for years.

This week, Facebook experienced the greatest drop in stock market value in history. (Dado Ruvic/Reuters)

What really seems to have spooked the market was the disclosure that the company believes that the slump will get "worse," with growth declining by "high single digits" over the next two quarters. Although there's a long way to fall — Facebook's year-over-year revenue grew by 42 per cent, according to Wednesday's result.

And a bit of perspective might be in order.

Some 2.5 billion people use Facebook, or one of its apps, each month. That's one-third of the world's population.

And Wednesday's losses?

They knocked Facebook's stock price back to where it was last November, and it is still trading at $25 a share more than it was when the data scandal began in March.

And while Zuckerberg is poorer, he's not poor. Even if one assumes the share drop is permanent, his net worth is still around $66 billion US.

Which would mean he is the sixth richest person alive.

On Wednesday, he was No. 3.


War no more?

​The Korean War may finally come to an end this fall.

Kan Kyung-wha, South Korea's foreign minister, has revealed that the two Koreas are targeting the annual United Nations General Assembly in New York in mid-September as the time and place for the signing of a treaty bringing an official end to the 68-year-old conflict.

North Korean leader Kim Jong-un, left, and South Korean President Moon Jae-in are moving toward calling a formal end to the war between their countries. (Korea Summit Press Pool via AP)

"[We] are in consultations with related countries for the war-ending declaration at the earliest possible date," she said yesterday in Seoul.

An armistice was signed by the UN, China and the North Koreans on July 27, 1953, but a peace agreement has never been reached.

The Americans, however, are not so convinced that the time is right to offer Kim Jong-un another turn in the global spotlight.

Earlier this week, a Washington, D.C., think tank released satellite photos that it claims show the North Koreans have begun dismantling a key missile testing and launch site, giving tangible form to the vague promises of denuclearization during Kim's June 12 summit meeting with Donald Trump in Singapore.

But the U.S. president is said to be deeply frustrated by North Korea's delays and demands since the summit, including requests for money and the cold shoulder Secretary of State Mike Pompeo received during a recent trip to Pyongyang.

South Korean soldiers stand guard in the border village of Panmunjom, which has separated the two Koreas since the Korean War. (Lee Jin-man/Associated Press)

A key moment in the new relationship looms on Friday. The Americans believed they had struck a deal in Singapore that would see the North hand over the remains of some 5,300 American soldiers who are still unaccounted for after the three bloody years of fighting. The transfer of an initial 55 sets of bones was supposed to take place on the 65th anniversary of the armistice. But it has proven difficult to get a straight answer out of the Kim regime, and two days out, the U.S. is still unsure if it will happen.

One thing that definitely has changed are the North's propaganda efforts. There are new websites for the Arirang-Meari news agency and English-language Pyongyang Times.

All told, the Kim regime now operates 160 official information portals, and is busy adding to its 7,000-strong propaganda workforce.


Quote of the moment

"I feel that this election has been the fairest in Pakistan's history."

Former cricket star Imran Khan claims victory in Pakistan's election this morning. But all five opposition parties are raising questions about the slow ballot count and incomplete results.


What The National is reading

  • Mexico vows it won't cut separate trade deal with Trump (CBC)
  • Japan executes last sarin attack cult members (BBC)
  • Teacher charged one year after Ontario teen dies on school canoe trip (CBC)
  • Venezuela to remove five zeroes from ailing currency (Reuters)
  • Russian track athletes stripped of 2008 Olympic medals for doping (CBC)
  • Sean Spicer and the art of failing upward (The Atlantic)
  • Vandals set Betsy DeVos' $40 million yacht adrift (Toledo Blade)
  • Alien killer spider eats native lizard (Irish Times)


Today in history

July 26, 1960: Glenn Gould rehearses for the Stratford Festival

There's not much playing in this clip — a little solo piano at the beginning, then some practising for a duet with American violinist Oscar Shumsky at the end. But it does feature a relaxed Gould bantering about music with Lou Applebaum, Stratford's then-musical director, for several minutes. They talk about the Festival Theatre's acoustics, the mindset of musicians from communist Russia and why composers are better at discussing their art than painters. All while Gould sits in his trademark tiny chair, hunched before the keyboard.

Gould in conversation with the festival's musical director Lou Applebaum. 5:13

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About the Author

Jonathon Gatehouse

Jonathon Gatehouse

Has covered news and politics at home and abroad, reporting from dozens of countries. He has also written extensively about sports, including seven Olympic Games and a best-selling book on the business of pro-hockey.