EU leaders won't intervene to break Brexit trade talks deadlock

European Union leaders will not intervene to save the deadlocked Brexit trade talks, diplomats in Brussels warned as the bloc toughened its stance over British time-wasting in negotiations.

At a meeting in Brussels on Tuesday, Michel Barnier told EU ambassadors the UK was trying to renege on its legally binding Withdrawal Agreement commitments and non-binding undertaking in the Political Declaration on the trade talks.

Speaking at an event in Dublin on Wednesday, Phil Hogan, the EU's trade commissioner, warned: "We're 450 million people in the EU, there's about 60 to 70 million in the UK. Size matters in trade.

"[We] need a lot more intensive engagement than we've seen in the last few weeks and months to have a deal by the end of the year – we need to get on with the job."

The warnings come ahead of next week's round of trade negotiations and after Michael Gove suggested on Tuesday that Britain could accept tariffs as part of a trade agreement to "show some leg" to Brussels. Mr Gove has previously said coronavirus should concentrate EU minds on getting a deal.

Mr Barnier accused Britain of trying to press ahead with talks in areas such as transport and services while refusing to negotiate on fisheries and the "level playing field" guarantees in tax, state aid, labour rights and the environment that the EU wants in return for a zero-tariff deal.

The UK argues that the "level playing field" guarantees would limit its ability to diverge from EU rules and are more stringent than is usual in trade deals. The EU is demanding continued access to UK waters on "existing conditions" as the price for a trade agreement, something Britain has ruled out.

Mr Barnier, the EU's chief negotiator,  criticised Britain for failing to present key texts for key areas, such as fisheries, in the last round of negotiations.

He later demanded "parallel" progress across all areas of talks, which will begin again on Monday with a round of online negotiations because of the coronavirus pandemic.

During a devastating presentation to senior diplomats from the remaining 27 EU member states, Mr Barnier cast doubt on whether the UK had the bandwidth to deal with trade talks with the EU as well as trade negotiations with the US, which began this week, and the coronavirus crisis.

EU ambassadors agreed with him that Britain was guilty of heaping unnecessary time pressure on the free trade agreement negotiations by refusing to consider extending the Brexit transition period beyond the end of the year.

Sources told The Telegraph that senior diplomats, including from countries traditionally friendly to Britain, had castigated the UK Government for doubling down on its threat to walk away from the negotiations if it judged insufficient progress towards the deal had been made at a "high-level meeting" in June.

Downing Street has called on EU leaders such as Angela Merkel and Emmanuel Macron to intervene over Mr Barnier's head and find a political way out of the impasse with Boris Johnson at the  meeting in June.

All EU trade negotiations are handled by the European Commission.

"Focus is being given in London to the high level meeting in June in London," one EU diplomat said. "Member states are not sure both parties have similar expectations.

"For us, this is a time to take stock and review the negotiations and decide whether or not to extend the transition period, which seems unlikely."

EU diplomats warned that the high-level meeting would have to be held before the June EU summit in Brussels, which will make it difficult for all 27 leaders to agree to a compromise brokered by Mr Johnson.

"There was shared concern that Britain wants to walk back on commitments arising from the Withdrawal Agreement and the Political Declaration," one EU diplomat said.

Brussels insists the treaty provides for the establishment of an EU office in Belfast to ensure the post-Brexit customs regime is implemented, which the UK contests. The Political Declaration is a non-binding document setting the terms of the possible trade deal.

"Our aim is zero tariffs and zero quotas – that is at least as much in the EU's interest as ours and the EU has come close to reaching this aim in their other Free Trade Agreements," a UK spokesman said.

"The EU continues to say that's only possible if we accept onerous controls over our right to set our own laws. We aren't going to trade our sovereignty for tariffs, so if the EU insist on this position then we will in the end lose the chance of a mutually beneficial zero-zero outcome."