Time running out for trade deal with UK, warns EU

Time is running out for a deal to be struck between the UK and the European Union that must be in place by the end of the year, EU diplomats have warned as negotiators make a final effort to avoid deep upheaval to trade in seven weeks’ time.

There are expectations that the next 10 days will make or break the talks, deciding whether punishing tariffs will be levied on imports and exports between the EU and its former member state from January 1st, alongside wide-ranging disruption as prior agreements cease.

“It’s already getting extremely late and may be too late already,” a senior diplomat said, if an agreement can be found “at all”.

“This will be tight, and as the negotiations drag on we may have to see if we find some creative solution but it’s too early to discuss that at this stage,” the diplomat added.

Negotiations moved to Brussels on Monday after a week of talks in London failed to reach a breakthrough, with pressure mounting from businesses to provide certainty over trade and logistical arrangements in the new year.

Crash exit

Minister for Foreign Affairs Simon Coveney said preparations for a crash exit would become the priority if nothing had moved by the end of next week.

“We really are in the last week to 10 days of this, if there is not a major breakthrough over the next week to 10 days then I think we really are in trouble and the focus will shift to preparing for a no-trade deal and all the disruption that that brings,” said Mr Coveney. 

“The British government understand only too well what’s required for a deal this week, the real question is whether the political appetite is there to do it. I think we will, that’s been my prediction for a while, but I won’t be shocked if it all falls apart.”

A buffer of time is needed between the reaching of any agreement and the date it is due to start because it must go through a ratification process in the EU. Certain to run to hundreds of pages, the deal must be translated into the EU’s official languages so it can be scrutinised by national governments and members of the European Parliament.

Any agreement requires a vote in favour in the parliament to come into force, and a vote has been provisionally pencilled in for December 16th. It’s possible that national parliaments may also have to vote on some aspects of the deal.

A European Commission spokesman said disagreement persisted over the rights to fish in Britain’s economic waters, which the British negotiators have pushed to claim back entirely while granting allowances in yearly negotiations. The EU is negotiating for continued access for its fishing communities, arguing that Britain needs to sell the fish in its markets.

“Fisheries is still one of the topics on which there is still quite a lot of divergence on the positions of the European Union and the United Kingdom, ” said the spokesman.

“We remain determined and we’ll show a lot of patience and respect in trying to strike an agreement.”