Britain will not rush to trigger divorce proceedings with the European Union, a leading ally of incoming Prime Minister Theresa May said yesterday as David Cameron bowed out at his final cabinet meeting.
May, 59, will today replace Cameron, who is resigning after Britons rejected his advice and voted on June 23 to quit the EU, plunging the country into political and economic uncertainty.
On arriving and departing from the brief cabinet meeting, the interior minister waved a little awkwardly from the doorstep of 10 Downing Street, shortly to become her home.
She will face the enormous task of disentangling Britain from a forest of EU laws, accumulated over more than four decades, and negotiating new trade terms while limiting potential damage to the economy.
The pound rose more than 1% against the dollar yesterday, boosted by the appointment of a new prime minister weeks earlier than expected after May’s main rival dropped out.
The currency was on track for its biggest daily gain since the Brexit vote drove it to 31-year lows.
But May’s ally Chris Grayling appeared to dampen any hopes among Britain’s EU partners that her rapid ascent might accelerate the process of moving ahead with the split and resolving the uncertainty hanging over the 28-nation bloc.
Grayling, the leader of the House of Commons, said there was no hurry to invoke Article 50 of the EU’s Lisbon Treaty, which will formally launch the process of separation and start the clock ticking on a two-year countdown to Britain’s actual departure.
“I think Article 50 should be triggered when we’re ready. The most important thing right now is we do what’s in our national interest,” Grayling told Sky News.
“We get ourselves ready for the negotiation, we decide what kind of relationship we want to negotiate, and then we move ahead and trigger Article 50. We’ll do it right, we’ll do it in a proper way, we’ll do it when we’re ready.”
German Chancellor Angela Merkel said on Monday that Britain should clarify quickly how it wants to shape its future relationship with the EU, adding she wanted London to remain an important partner.
“But of course the EU and the remaining 27 member states also have to protect their interests,” she said.
Bank of England Governor Mark Carney said yesterday that the expected hit to Britain’s economy from the Brexit vote could prompt the central bank to provide more stimulus.
It is due to announce tomorrow whether it will cut its key interest rate, which has remained at 0.5% for more than seven years, or take other action.
The chief investment officer of BlackRock, the world’s biggest asset manager, predicted Britain would fall into recession in the coming year, as Cameron and a host of policymakers and think-tanks had warned before the referendum.
“Recession is now our base case,” Richard Turnill said. “There’s likely to be a significant reduction of investment in the UK.”
May, who had favoured a vote to stay in the EU, was left as the last woman standing after three leading rivals from the referendum’s winning Leave campaign self-destructed in the course of a short-lived leadership race.
Her last rival, Andrea Leadsom, dropped out of the race on Monday, removing the need for a nine-week contest to decide who would become leader of the ruling Conservative Party and prime minister.
May will become Britain’s second woman prime minister after Margaret Thatcher. One veteran of Thatcher’s cabinet described her last week as a “bloody difficult woman”, a comment that may have helped her by implying comparison with the “Iron Lady”.
She has served for the past six years as interior minister, regarded as one of the toughest jobs in government, and cultivated a reputation as a tough and competent pragmatist.
She has already been likened to Germany’s Merkel for her cautious, low-key style.
Apart from the task of leading Brexit, May must try to unite a fractured party and a nation in which many, on the evidence of the referendum, feel angry with the political elite and left behind by the forces of globalisation and economic change.