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Downing Street indicates no-deal Brexit still 'possible' outcome from Brexit trade talks

EU negotiator Michel Barnier this morning signalled that there was a “narrow path” to a trade deal with Britain.

British Prime Minister Boris Johnson with European Commission president Ursula von der Leyen
British Prime Minister Boris Johnson with European Commission president Ursula von der Leyen

Updated Dec 14th 2020, 2:05 PM

DOWNING STREET HAS said a no-deal Brexit was a “possible” outcome from the EU trade talks, signalling that there had been some improvement since Boris Johnson said it was the “most likely” scenario yesterday. 

“Obviously no-deal is a possible outcome, as the Prime Minister has said himself,” Johnson’s official spokesperson said.

“But we have been clear that we will continue to work and hope to reach a free trade agreement.”

Johnson and EU chief Ursula van der Leyen pledged to “go the extra mile” yesterday as they side-stepped a self-imposed cut-off point to end talks if there was no progress towards a pact.

EU negotiator Michel Barnier this morning signalled that there was a “narrow path” to a trade deal with Britain. 

An EU diplomat said following a briefing from Barnier that “there might now be a narrow path to an agreement visible – negotiators can clear the remaining hurdles in the next few days”.

“There has been some progress in the negotiations over the last few days, but – sometimes substantial – gaps still need to be bridged in important areas like fisheries, governance and level playing field,” the diplomat said.

An EU source said there had been “fragile” progress.

Barnier was setting out the state of play to ambassadors from the EU’s member states in Brussels this morning.

The ongoing talks have fuelled speculation that Parliament may be forced to sit over the festive period to vote on any agreement.

Taoiseach Micheál Martin said he was hopeful negotiators can strike a deal in the coming days but that significant challenges still remained on the key sticking points.

“I’m hopeful but I don’t want to understate the very significant challenges that face both the UK side and the European Union side on this level playing field issues and the fishery issue. They are significantly difficult issues,” he told RTÉ’s Morning Ireland programme.

You’re right, the real end deadline is New Year’s Eve but I think both sides are very possessed of the need to get outcomes to these negotiations in the next number of days.

Former chief whip Mark Harper, speaking to BBC Radio 4’s Westminster Hour, said: “It depends on when it is concluded, but many of us are fully anticipating it’s entirely possible we might be returning to Parliament between Christmas and New Year to scrutinise this and vote it through if a deal is done.”

Shadow business secretary Ed Miliband told BBC One’s Andrew Marr Show that Labour was “minded” to vote for a deal in a sign that, should consensus be reached in Brussels, the terms of any future relationship with Britain’s largest trading partner would face little opposition in Parliament.

‘Most likely scenario’

This morning’s comments from Downing Street appear more positive than yesterday’s stance when Johnson continued to warn that a no-deal outcome was still the most likely scenario.

He said yesterday the country should get ready for the breakdown of talks, resulting in tariffs under World Trade Organisation (WTO) terms from 1 January – a move that is predicted to cost jobs, cause food prices to rise and wipe £45 billion off the economy next year.

“The most likely thing now is, of course, that we have to get ready for WTO terms, Australia terms,” UK the Prime Minister said.

climate-ambition-summit-boris-johnson British Prime Minister Boris Johnson. Source: Xinhua News Agency/PA Images

The agreement to continue talking beyond yesterday’s deadline set by Johnson and von der Leyen does indicate that progress could still be made.

The pair agreed to “keep going for as long as they still think a deal is possible”, a UK source said.

A joint statement issued by the two leaders said: “Our negotiating teams have been working day and night over recent days.

“And despite the exhaustion after almost a year of negotiations, despite the fact that deadlines have been missed over and over we think it is responsible at this point to go the extra mile.”

After updating the Cabinet on his talks with the commission chief, Johnson told reporters the UK would be “as creative as we possibly can” in search of an agreement but stressed that there were fundamentals that could not be compromised, such as “being able to control our laws, control our fisheries”.

“I think our friends get it, and we remain willing to talk and will continue to do so,” he added.

The major sticking points in the negotiations – as they have been for months – are on fishing rights and the “level playing field” which Brussels wants to prevent unfair competition from the UK undercutting EU standards and state subsidy rules.

Johnson has said that no prime minister could accept a situation where the EU could automatically “punish” the UK if it failed to follow future regulations from Brussels.

If that “ratchet clause” was watered down, there could be the possibility of a deal – the UK side has already indicated it would not regress from existing EU standards on issues such as workers’ rights and environmental protections.

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The Times reported that chief negotiators Lord Frost and Michel Barnier are discussing what role independent arbitration could have in resolving disputes in a potential sign that a compromise could be in the offing.

The pair are due to continue talking in Brussels today.

On fishing rights, the row over what access EU trawlers would have to UK waters dramatically escalated over the weekend, with Royal Navy vessels on stand-by to patrol the seas around Britain if there is no deal.

Despite his talks with Mrs von der Leyen in recent days, the Prime Minister remains frustrated that he has not been able to speak directly to key EU national leaders including Germany’s Angela Merkel and France’s Emmanuel Macron.

Brussels insists that the commission is leading the negotiations on behalf of the 27 member states so Johnson should continue dealing with von der Leyen.

With reporting by AFP.

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