Published: Fri, November 16, 2018
Money | By Ethel Goodwin

Brexit deal: May fights for survival as Tory civil war looms

Brexit deal: May fights for survival as Tory civil war looms

Raab's resignation, which has since been followed by those of work and pensions minister Esther McVey and Department for Exiting the European Union minister Suella Braverman, also sparked a sterling sell off as the pound dropped 1.3 per cent to $1.281.

Ester McVey, the secretary of state for work and pensions, has resigned from her post in protest at May's Brexit plan.

Sterling had stolen the limelight overnight after a rash of resignations rocked Prime Minister Theresa May's government and threw into doubt her long-awaited Brexit agreement just hours after it was unveiled. On Thursday morning, May's Brexit secretary, the man who led her negotiating team in Brussels to hammer out that draft, quit, along with another member of her cabinet and several junior ministers.

The morning after the night before was a rough one for British Prime Minister Theresa May.

It would depend on whether she could survive a no-confidence vote and whether she would decide to face a challenge in an election among leadership contenders.

This is a developing story.

A confidence vote can only take place once at least 15% of the party, or 48 MPs, call for one to take place. Even if the deal passes with a narrow majority, the country will still be bitterly split between those who accept this muddling compromise, the little Englanders who demand a diamond-hard Brexit and the roughly 50 per cent of voters who wish this could all turn out to be a bad dream and Britain could just stay in the EU.

Thursday's political mayhem prompted a big fall in the value of the pound, which was trading 1.5 percent lower at $1.2797 as investors fretted that Britain could crash out of the European Union in March without a deal.

The main opposition Labor leader Jeremy Corbyn said May's plan represents a huge and damaging failure and does not meet Labor's six tests, an indicator that his party's MPs would vote against her deal. "We can choose to leave with no deal, we can risk no Brexit at all or we can choose to unite and support the best deal that can be negotiated, this deal", she said.

Yet if the British Parliament rejects Mrs May's compromise soft Brexit proposal, there is no certainty that the "remain" cause would triumph.

It also needs approval from Britain's Parliament before the United Kingdom leaves the bloc on March 29 - and even if May survives as leader, the chances of that look slim.

"On both sides, we have exhausted our margin of manoeuvre", an official said, adding: "We think it is the best we can we can do with the constraints we have on both sides".

MSCI's broadest index of Asia-Pacific shares outside Japan erased early gains to go flat, then edged up 0.1 per cent. May's allies in the Democratic Unionist Party and opposition parties. "Since performances of these companies set the tone for the global tech and chip industries, related Japanese stocks will likely be sluggish for a while", said Takatoshi Itoshima, a strategist at Pictet Asset Management.

Asked if she would allow her next Brexit Secretary to rewrite the deal, she said Mr Gove was doing an excellent job is his current position.

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