LONDON (AP) – Britain and the European Union (EU) warned yesterday that talks on a post-Brexit free-trade deal are teetering on the brink of collapse, with just over three weeks until an economic rupture that will cause upheaval for businesses on both sides of the English Channel.
Officials downplayed the chances of a breakthrough when Prime Minister Boris Johnson heads to Brussels for face-to-face talks with European Commission President Ursula von der Leyen in the next few days.
With negotiators deadlocked on key issues after months of tense talks, German European Affairs Minister Michael Roth said the bloc’s confidence in Britain was hanging in the balance.
“What we need is political will in London,” said Roth, whose country currently holds the EU’s rotating presidency. “Let me be very clear, our future relationship is based on trust and confidence. It’s precisely this confidence that is at stake in our negotiations right now. “We want to reach a deal, but not at any price,” Roth told reporters before chairing videoconference talks among his EU counterparts.
Johnson’s Downing St office said the situation was “very tricky” and collapse of the talks was a distinct possibility. Johnson and von der Leyen, head of the EU’s executive arm, spoke by phone on Monday for the second time in 48 hours.
They said afterwards that “significant differences” remained on three key issues – fishing rights, fair-competition rules and the governance of future disputes – and “the conditions for finalising an agreement are not there.”
The two leaders said in the joint statement that they planned to discuss the remaining differences “in a physical meeting in Brussels in the coming days.”
Leaders of the EU’s 27 nations are holding a two-day summit in Brussels starting tomorrow.
The United Kingdom (UK) left the EU politically on January 31, but remains within the bloc’s tariff-free single market and customs union through December 31. Reaching a trade deal by then would ensure there are no tariffs and trade quotas on goods exported or imported by the two sides, although there would still be new costs and red tape.
Both sides would suffer economically from a failure to secure a trade deal, but most economists think the British economy would take a greater hit because the UK does almost half its trade with the bloc.
While both Britain and the EU say they want a trade deal, trust and goodwill are strained after months of testy negotiations.
The relationship has been further strained by British legislation that breaches the legally binding Brexit withdrawal agreement Johnson struck with the EU last year.
Britain said the Internal Market Bill, which gives the government power to override parts of the withdrawal agreement relating to trade with Northern Ireland, is needed as an “insurance policy” to protect the flow of goods within the UK in the event of a no-deal Brexit. The EU sees it as an act of bad faith that could imperil Northern Ireland’s peace settlement.
The House of Lords, Parliament’s unelected Upper Chamber, removed the law-breaking clauses from the legislation last month, but the elected House of Commons restored them on Monday night.
As the parliamentary tussle continues, the British government has offered the bloc an olive branch on the issue, saying it will remove the lawbreaking clauses if a joint UK-EU committee on Northern Ireland finds solutions in the coming days.