Analysts from all over the world have been watching with great care the rival visions that have been emerging within the past two weeks in the different debates that will end in the selection of a new British Tory leader. Head-to-head clashes between Rishi Sunak and Liz Truss have witnessed each of the contenders trying to be the next Prime Minister tearing into each other over a broad range of issues-- be it tax, the future of the UK economy or subsequent relations between the United Kingdom and the European Union or potential future relations with China. The former Foreign Secretary and former Chancellor, who until four weeks ago were in the same Cabinet, have not been holding back in their arguments and observations. Such an approach has led to complaints from supporters of both sides that both of them have been over-aggressive.
It appears that Ms. Truss wants to scrap the rise to National Insurance, a planned rise in corporation tax and would temporarily scrap green levies on energy bills to be paid for through borrowing. On the other hand, Mr. Sunak has responded by saying that he would not cut taxes until inflation is under control. It may be recalled that Mr Sunak, who quit as Chancellor a few weeks ago, has underlined that the coronavirus pandemic had created a large bill and that putting it on the "country's credit card" would "pass the tab to our children and grandchildren". In her response Ms. Truss insisted that under her plans the UK would start paying down the debt in three year's time - and paying it back straight away as Mr. Sunak wanted to do would push the UK into a recession.
In this regard Sanjay Raja, Deutsche Bank's chief UK economist has observed to CNN that "the UK, as a small, open economy, can't do very much. It can't supply and make up these goods to limit the increase in prices to offset that inflation. The country is spending more importing goods than it makes from its exports. Rocketing fuel costs have helped the UK rack up a trade deficit of 8.3 per cent, the largest since the government's statistics office started keeping records in 1955. Add to that a weakened currency - the pound has lost nearly 12 per cent of its value against the US dollar since the start of this year - and the country can expect the costs of its imports to increase, while its exports could become more competitive on the global market."
Mr. Sunak has also suggested that Ms. Truss's plans would lead to higher interest rates. This has however been dismissed by the previous Foreign Secretary as "scaremongering" and "project fear" -- an echo of the criticism aimed at the Remain campaign during the Brexit referendum. In his response Mr. Sunak has pointed out that, unlike him, Ms. Truss had campaigned against Brexit. Her reply was interesting-- "Maybe I learnt from that." Later, she added that the Brexit referendum had helped to learn not to trust Treasury forecasts on the economy.
Such intense differences have led Labour leader Sir Keir Starmer to tell BBC Breakfast that the debate had shown a Conservative Party which had "lost the plot and lost its purpose". He said Mr. Sunak was acting like he had "just come down from the moon" and discovered the economy was in a bad way when he had been in charge of it until three weeks ago, while Ms. Truss was playing "fantasy economics" without explaining how she would pay for tax cuts. "We do need change in the UK but the change we need is not a change at the top of the Conservative Party, it is more fundamental than that. We need a fresh start for Britain, we need a Labour government," he said. A Liberal Democrat spokesperson on the other hand simply said: "Eurgh."
Brian Wheeler of the BBC has within this paradigm also drawn attention to the role of the two contenders and the way it is being followed within the matrix of social media. International analysts are carefully watching reports in the social media because it is a key battleground in any election held today-- even one with a very small electorate.
However PR expert Mark Borkowski has observed interestingly that "everything about Sunak's approach is slick. It is overly professional in some ways. I am not sure whether that is a good or a bad thing. There seems to be a lot of strategy and thinking behind it." The Truss campaign on the other hand "feels a little bit more homespun", he has added. Sunak's social media strategy is apparently masterminded by Cass Horowitz, son of best-selling novelist Anthony Horowitz. As a special adviser to Sunak when he was Chancellor, Horowitz used fancy graphics and clever taglines to sell "Brand Rishi" to a younger, politically unengaged audience on Instagram.
Liz Truss's social team, on the other hand, appears to be run by Reuben Solomon, former head of digital at the Conservative Party, and a protégé of Boris Johnson's favourite election strategist Sir Lynton Crosby. Comparatively, they have tried to play it safe so far. Johnson's main allies have since piled in to support Truss as the anti-Sunak candidate and are briefing aggressively against Sunak, echoing the line that he was responsible for the government's economic failures.
Analysts in this context have also remarked that "Truss is presenting herself in a more statuesque manner. The digital content comes across quite posed and generic, and plays on her role, time and successes as foreign secretary. While Truss does not come across as a digital native, her social media campaign seems as though it is most strategically steered towards the Conservative Party membership, who are the ones who will be voting to decide Britain's next Prime Minister."
CNN, on the other hand, while analysing the process currently on for choosing Boris Johnson's replacement has also correctly drawn attention to the important fact that this selection will not be through an election participated by 47 million adults registered to vote, but by a much smaller group of around 160,000 grassroots Conservative Party members. The winner, it may be mentioned, will be announced on September 5.
We need to remember that constitutionally in the UK, Prime Ministers are not elected directly. Instead, Members of Parliament are elected and the Leader of the party with the largest number of MPs conventionally forms a government. The Conservatives still enjoy a healthy majority from Johnson's 2019 election win, so his successor simply inherits that majority and takes over as the Head of Government.
EU analysts Fabian Zuleeg and Emily Fitzpatrick have also been following the evolving scenario in Britain and have made some interesting observations.
They have pointed out that Brexit might not be as integral to the political identities of Liz Truss and Rishi Sunak as it was for Boris Johnson. In this context it has been suggested that under the forthcoming British Administration, the new leadership is unlikely to pursue the path for a radical reset of EU-UK relations. In this regard it is generally felt in Brussels that there is little potential for repairing the deeply fractured EU-UK relationship.
It has been pointed out that antagonistic relations with the EU were a cornerstone of Johnson's popularity. His star rose as a leader of the Vote Leave campaign during the 2016 Brexit referendum, and he won the 2019 general election on a promise to "Get Brexit Done". There are also observations that while he was Prime Minister, Johnson had a habit of opting for inflammatory clashes with the EU when he needed to reinvigorate his Conservative base.
Fabian Zuleeg and Emily Fitzpatrick have opined that there has been limited discussion of the EU and future relations with Britain during Truss' and Sunak's political debates. Instead, the focus of this leadership contest has centred on domestic issues like tax cuts and the cost-of-living crisis. This omission of the EU from their debates has not necessarily been positive. They have pointed out that "despite Brexit's increasingly obvious negative implications for the UK economy which is expected to be the G7's slowest growing economy in 2023, neither candidate has put forward any meaningful strategy for a new, more constructive approach to EU-UK relations.
In addition it has been observed that Truss, the current frontrunner in the leadership contest has continued to serve in Johnson's caretaker government, and formerly a 'Remainer', she has worked hard the past year to demonstrate her 'Brexit credentials'. In fact, it has been suggested that Truss' introduction of the Northern Ireland Protocol Bill (NIPB) in June has won her few friends in Brussels, where it is viewed as a violation of international law.
However, some other analysts have observed that Truss discussed this measure with the Conservative Party's European Research Group (ERG) before bringing forward the Bill, and many in Brussels believe that her motivation in progressing the legislation was to solidify her chances as Johnson's successor among the Eurosceptic factions of the Conservative Party.
Such a future measure and reliance on the Conservative Party's Eurosceptic wing, however, means that it is unlikely that Truss could roll back on her hard-line approach if she eventually becomes the British Prime Minister. This might further damage the EU-UK relationship, as the EU has warned of counter measures should the NIP-B become law. This means that any rebuilding of relations between Britain and the EU would be difficult under Truss' leadership.
It needs to be mentioned that former Chancellor Sunak on the other hand has maintained a greater distance from the toxic NIP dispute. Despite campaigning for the UK to leave the EU in 2016, Sunak has not made Euro-scepticism a cornerstone of his leadership campaign to the same extent as Johnson and now Truss. As such, Fabian Zuleeg and Emily Fitzpatrick feel that there could be scope to rebuild relations between EU and Britain under a Sunak premiership.
One aspect appears to be quite certain. No matter which candidate wins, they will likely call a general election within a year to legitimise their leadership. It is also unlikely that any agreement on the NIP will be reached before then. Brussels, in this context, will have to remain in waiting mode until internal British politics settle down and genuine discussions can resume.
Muhammad Zamir, a former Ambassador, is an analyst specialized in foreign affairs, right to information and good governance.