Yahoo Finance EU believes a Brexit deal is ‘very close’ with Irish border breakthrough
EU Brexit negotiators believe they are “very close” to achieving a deal with the UK amid talk of a possible breakthrough over the Irish border issue.
The upbeat assessment was given by a member of Michel Barnier’s negotiating team to a conference of diplomats representing the 27 other EU member states on Thursday evening.
The comments, confirmed to Reuters by two sources at the meeting, sent sterling to a 10-week high against the euro (GBPEUR=X).
The outbreak of optimism comes ahead of an EU leaders’ summit on 18 October which has been branded the “moment of truth” for Brexit negotiations.
A final deal on the Withdrawal Agreement does not have to be reached at the summit, but the EU have said they want to see “substantial progress.”
If that is achieved, an emergency summit will be held in November to conclude the deal before it is put to the UK and European parliaments.
Irish prime minister Leo Varadkar dropped a big hint that the second summit would go ahead on Thursday when he said he wanted to see a deal concluded by November.
And it is progress over the Irish border issue thrown-up by Brexit that is behind the outbreak of optimism.
UK negotiators have reportedly put forward new proposals for a ‘backstop’ solution to avoiding a hard border in Ireland that are under serious consideration by the EU side.
The plans, which have not yet been formally tabled by the UK government, would see the UK as a whole remain in the EU’s customs union if the ‘backstop’ solution was ever needed.
That would be acceptable to the DUP because it would not separate Northern Ireland from Britain for customs purposes, as the EU’s initial ‘backstop’ proposal would have done.
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It would also comply with the EU’s red line that the ‘backstop’ must not be time limited, as was the case with the UK’s previous proposal.
Varadkar said the ‘backstop’ was so crucial to Ireland as it was likely it will take the UK and EU longer than the two-year Brexit transition period to hammer out a free trade deal that would eliminate the need for border checks.
European Council president Donald Tusk delivered a fresh rejection of Theresa May’s Chequers plan on Thursday, but offered the “Canada+++” free trade deal supported by the likes of UKIPs Nigel Farage and Conservative backbencher Jacob Rees-Mogg.
Tusk said that would keep the relationship between the EU and UK “as close and special as possible.”
European Commission president Jean-Claude Juncker said on Friday that negotiations are “not easy” because of the different messages that emerge from UK politicians.
“There is a polyphonic chorus at the level of the British cabinet and we try to arrange the pieces … so that they become a melody,” he told the Austrian parliament.
Two things need to be agreed on 18 October to avoid a no-deal Brexit – the Withdrawal Agreement and a political declaration on the future relationship between the UK and EU.
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The ‘backstop’ is part of the detailed Withdrawal Agreement that runs to 129 pages, whereas the declaration about the future of trade is expected to be much vaguer and take up as few as six pages.
UK international trade secretary Liam Fox said an imperfect Brexit would be acceptable to him in order to get it over the line.
“We should try to get as much of a final deal as we can get by the 29th of March, but it’s self-evident that if it’s a bilateral treaty, it can be revised later on,” he told Bloomberg.
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