France said to Soften Stance on Fishing

Above: Emmanuel Macron. GUE/NGL, accessed Flickr, reproduced under CC Licensing.

It is reported Friday that France is preparing to give ground on the matter of one of the main outstanding issues preventing negotiators from striking a post-Brexit trade deal: fishing.

According to a Reuters report, France is preparing its fishing industry for a smaller catch after Brexit, industry members said, "in a sign that President Emmanuel Macron is laying the ground for a delicate compromise to help the European Union strike a trade deal with Britain".

Macron struck a decidedly tough tone on the doorstep of the mid-October European Council summit, saying his country would not compromise on access to UK waters.

France's position signalled to markets that the final showdown in post-Brexit trade negotiations would likely rest with fisheries, and we noted in a piece out Friday that EU Chief Negotiator Michel Barnier isn't "worried about anything else but fish".

Macron has however softened his stance saying earlier this week the French fishing fleet will no longer be in the same situation as today after year-end.

But, privately, his government has gone further, bluntly telling France’s politically influential fish industry to brace for impact, sources told Reuters.

According to the report, Clement Beaune - France's Europe Minister - reportedly told fisherman in Port-en-Bessin in Northern France last week that they should no longer expect to maintain "the status quo".

The Pound spiked higher on the news.

"Some temporary relief for the Pound came from reports that France is preparing a compromise on the matter of fisheries. This economically marginal but highly politicised topic of discussions is one of the major stumbling blocks in the Brexit negotiations. The news suggests the EU and UK are making progress," says Mathias Van der Jeugt, an analyst with KBC Markets.

Despite an early rally in Sterling on the news the currency soon reversed gains, confirming foreign exchange markets are intent on maintaining a wait-and-see mode given there are potentially weeks more of negotiations that will need to be navigated.