Theresa May clings to power as Brexit gambit backfires

Prime minister Theresa May was clinging on to power on Thursday (23) after her final Brexit gambit backfired, overshadowing a European election that has shown a Uk still riven by division over its EU divorce.

May's departure will deepen the Brexit crisis as a new leader is likely to want a more decisive split with the European Union, raising the chances of a confrontation with the bloc and an election which could usher in a socialist government.

In such a fluid situation, the world's fifth largest economy faces an array of options including an orderly exit with a deal, a no-deal exit, an election or a second referendum which could ultimately reverse the 2016 decision to leave the EU.

May, who won the top job in the turmoil which followed the 2016 referendum on EU membership, has repeatedly failed to get parliament's approval for the divorce deal she pitched as a way to heal the Brexit divisions of the country.

But her last gambit, offering a possible second referendum and closer trading arrangements with the EU, triggered a revolt by some Brexit-supporting ministers. She is now under pressure to name her departure date.

House of Commons leader Andrea Leadsom resigned, saying she felt May's approach would not deliver Brexit. The BBC said more ministers could follow. "May set to go after Brexit fiasco," read The Sun newspaper's front page, while The Times said: "May prepares to quit after cabinet mutiny."

Foreign secretary Jeremy Hunt said May would still be prime minister when US president Donald Trump arrives for a state visit on June 3.

"Theresa May will be prime minister to welcome him, and rightly so," Hunt said.

While the country remains deeply divided over Brexit, most agree that it will shape the future of the United Kingdom for generations to come.

Pro-Europeans fear Brexit will undermine London's position as one of the world's top two financial capitals and weaken the West as it grapples with Trump’s unpredictable presidency and growing assertiveness from Russia and China.

The loss of Britain for the EU is the biggest blow yet to more than 60 years of effort to forge European unity after two world wars, though the 27 other members of the bloc have shown surprising unity during the tortuous negotiations.

May, who has shown obduracy during one of the most tumultuous premierships of recent British history, had promised to leave office if lawmakers approved her Brexit deal but she is now under intense pressure to name a date.

Sterling, which tumbled on the 2016 Brexit vote to its biggest one-day fall since the early 1970s, dropped 0.4 per cent to a new 4-1/2 month low of $1.2605. The yield on the UK's 10-year gilt fell to 0.991%, the lowest since March 29, the day Britain had been due to leave the EU.

Downing Street refused to comment on May's future.

BREXIT CRISIS

Nearly three years after the United Kingdom voted 52% to 48% to leave the EU, it remains unclear how, when or even if it will leave the European club it joined in 1973. The current deadline to leave is Oct. 31.

When May goes, her Conservative Party will elect a leader who is likely to want to renegotiate the deal May agreed with the EU in November, raising the chances of a confrontation with the bloc and a national election.

The bookmakers' favourite to succeed May is Boris Johnson, the face of the official campaign to leave the EU, who has said he wants a more decisive split with the bloc. More than a dozen others are seen as potential candidates.

If there was an election and the Conservatives lost, the winner would be Labour Party leader Jeremy Corbyn, a veteran socialist who wants to nationalise swathes of the British economy but has not said what shareholders will get in return.

US investment bank JPMorgan raised its probability of a no-deal Brexit to 25 per cent from 15 per cent, saying its base case is that Johnson becomes prime minister, followed by a general election and then another delay to Brexit.

Investment bank BNP Paribas said on Thursday it now saw a 40 per cent probability of Britain exiting the European Union without a transition agreement in place.

The chairman of the powerful Conservative 1922 Committee, which can make or break prime ministers, told lawmakers that May planned to campaign in the European poll on Thursday before meeting with the group on Friday to discuss her leadership.

"I will be meeting the prime minister on Friday following her campaigning in the European elections tomorrow and following that meeting I will be consulting with the 1922 executive," 1922 Committee chairman Graham Brady told reporters.

The Times newspaper reported that May would name a date for her departure on Friday. May will remain as prime minister while her successor is elected in a two-stage process, the newspaper said.

The delay to Brexit means voters across the UK are going to the polls on Thursday in a European parliamentary election that has been fought almost exclusively over the EU divorce.

According to polling data published before polls opened, Nigel Farage's Brexit Party was on course to win and May's Conservatives are on course to do very badly.

Results are expected after 2100 GMT on Sunday.