UK Markets closed

New urgency as UK reopens stalled Brexit talks with EU

Jitendra JOSHI and Alice Ritchie with Alex PIGMAN in Brussels
·3-min read
If no agreement is reached, UK-EU trade could suffer huge disruptions
If no agreement is reached, UK-EU trade could suffer huge disruptions

Britain said Wednesday it was resuming trade negotiations with the European Union, accelerating the fraught process to round-the-clock meetings in a bid to salvage a deal within weeks.

London abruptly froze the talks on Friday after EU leaders said it was up to Britain, not the EU, to make concessions on contentious issues such as state subsidies, how to arbitrate future differences and fishing rights when a post-Brexit transition period expires.

Having accused the EU of throwing up unreasonable demands, Britain said the latest contact between their chief negotiators had opened the door to formal talks restarting on Thursday.

"It is clear that significant gaps remain between our positions in the most difficult areas, but we are ready, with the EU, to see if it is possible to bridge them in intensive talks," a spokesperson for British Prime Minister Boris Johnson said.

"For our part, we remain clear that the best and most established means of regulating the relationship between two sovereign and autonomous parties is one based on a free trade agreement."

If that proves impossible, "the UK will end the transition period on Australia terms and will prosper in doing so", the aide added, referring to Britain's formulation for a barebones arrangement governed by World Trade Organization quotas and tariffs.

In a joint document, both sides agreed to pursue the new round of talks between teams led by EU negotiator Michel Barnier and the UK's David Frost through the weekend.

"Talks will take place across all negotiating tables concurrently. Negotiations will take place daily including weekends, unless both sides agree otherwise," the document said.

But it cautioned that "nothing is agreed in these negotiations until a final overall agreement is reached".

The breakthrough came after Barnier earlier Wednesday addressed London's two main frustrations: the EU's insistence previously that it was solely up to Britain to make compromises, and its reluctance to shift to discussing the legal texts underpinning any trade deal.

"I think an agreement is within our grasp, if we are, on both sides, ready to work constructively and in a spirit of compromise," Barnier told a session of the European Parliament in Brussels.

A deal was possible "if we move forward in the coming days, on the basis of legal texts as we hope to do".

"Our door will always remain open," he promised.

- 'Cold sick' -

Failure to agree a deal could see a huge disruption to EU-UK business when the post-Brexit transition period expires in just over two months. From January 1, Britain will be free of EU structures after nearly five decades of tight economic integration.

Johnson refused an option to extend the transition period, but has shown more flexibility towards other trading partners.

On Wednesday, non-EU member Norway announced a temporary post-Brexit free trade deal to avoid disruption from January.

Anxiety has been mounting on both sides of the Channel about the likely repercussions of "no deal", with European fishermen notably warning they face ruin if deprived of access to Britain's rich waters.

On the UK side, businesses complain the government is failing to prepare on an array of fronts. Even with a trade deal, British companies will still need to wade through reams of new red tape to ensure their goods comply with EU standards. 

Senior minister Michael Gove joined Johnson on a conference call with 250 business leaders Tuesday and reportedly told them that Brexit was like moving house -- hassle at first, but worth it in the end to live somewhere nicer. 

That went down "like a bucket of cold sick", according to one participant cited in the Financial Times. 

Speaking before Barnier, EU chief Charles Michel asked London to decide if it actually wanted a deal, once and for all.

"The UK wants access to our single market, while at the same time, being able to diverge from our standards and regulations, when it suits them," he complained.

bur-jit/ar/mbx