German Chancellor Angela Merkel called on Tuesday the remaining members of the European Union to show unity during the negotiations over Britian’s departure from the bloc.
Her call came amid emerging disputes between richer western EU states and their poorer eastern peers on Tuesday over who should host the bloc’s London-based regulators for banking and drugs after Brexit.
Merkel also said the talks, which were launched on Monday, were important for the future of European integration.
Brexit was a setback but election results in the Netherlands and France this year have presented an opportunity to push ahead, Merkel said.
“Let’s stay together, let’s not divide from each other,” she said, with reference to the remaining EU 27.
“This is not just about the exit of Britain, with which we want to remain friends, with which we want to live in a good partnership, but it is also about the future of the European Union,” she said at a German industry conference.
“The four freedoms that give us the internal market must not be jeopardized,” she said with reference to the EU’s freedoms of movement of goods, capital, people, and services. “This will be significant at the exit negotiations.”
Merkel said she wanted the talks to be conducted “in a good spirit” and that Britain’s position would become evident in the coming months.
“We will of course implement what Britain pitches, but in a way that the interests of the 27 member states are safeguarded.”
At their first meeting in Brussels on Monday, British and EU negotiators agreed on a timetable for the Brexit talks. Both sides stressed their goodwill but acknowledged the task’s huge complexity and tight deadline.
Meanwhile, several of the remaining EU states have already signaled they could take on the European Banking Authority (EBA) and the European Medicines Agency (EMA) – bodies that together employ more than 1,000 people.
“This is a difficult discussion because for the first time since the Brexit decision, this theme is actually dividing the 27 whereas so far our strength in facing Brexit has been in our unity,” one senior EU diplomat said.
“Eventually it will be a political decision with a lot of horse-trading behind the scenes.”
Arriving at an EU ministerial meeting on the matter on Tuesday, Luxembourg’s Foreign Minister Jean Asselborn made a play for the EBA, saying his country was already a European financial hub.
Germany and Ireland have already said they would apply to host both bodies, though diplomats say they would not go to any single country.
The newer member states in the east of the bloc who have joined since 2004 say they host fewer common EU bodies and want this disparity addressed.
Officially the meeting in Luxembourg is focused technicalities – ministers will work out a procedure for
deciding the agencies’ location. Those rules will be finalized and endorsed when EU leaders meet for a summit in Brussels on Thursday and Friday.
The bloc’s executive European Commission would then prepare criteria for the choice though, diplomats said, some ministers wanted the Brussels-based EU political capital to go further and assess potential candidates, or even draw up a shortlist.
Barcelona, Milan, Copenhagen and Dublin have all started campaigning to host the EMA, which has an annual budget of $360 million.
Frankfurt, Paris, Amsterdam, Vienna, Lyon and Strasbourg are among the cities wanting the EBA, whose 160 London-based employees write and coordinate banking rules across the bloc.
EU officials said the bloc would have to consider a range of criteria including logistical support and infrastructure, though eastern states have said that would favor the wealthier west.
One of the proposed criteria would ensure geographical spread. Countries have until the end of July to propose cities before EU states vote, first on the medical, then on the banking authority. A senior EU official said the final decision was expected in October.