Brexit: May still has 'huge challenge' to move talks to trade, says Tusk

Theresa May still faces a “huge challenge” in persuading the EU to move the Brexit negotiations on to discussions about trade and a transition period in December, the president of the European council, Donald Tusk, has said.

Following a face-to-face meeting with the British prime minister in Brussels on Friday, Tusk struck a sombre note just weeks from a crunch meeting of EU leaders which will decide whether sufficient progress has been made to allow Brexit talks to move on from the opening issues of citizens’ rights, the border on the island of Ireland and the financial settlement.

After an hour-long meeting with May on the margins of a summit, Tusk appeared to dash the prime minister’s hopes of a smooth move to wider talks.

He highlighted the problem of avoiding a hard Irish border, something Dublin believes can only be achieved by, in effect, keeping Northern Ireland within the single market and customs union. Britain has rejected that solution as an affront to the UK’s constitution.

With a key dinner between May and the European commission president, Jean-Claude Juncker, scheduled for 4 December, Tusk said the British government had 10 days to offer a way forward.

“Sufficient progress in Brexit talks at December [European council meeting] is possible,” Tusk tweeted. “But still a huge challenge. We need to see progress from UK within 10 days on all issues, including on Ireland.”

The Bulgarian prime minister, Boyko Borissov, confided that he personally feared talks were heading for a breakdown.

May conceded that there were “still issues across the various matters that we are negotiating on to be resolved” in phase one of the Brexit talks. However, she insisted that there was a “positive atmosphere” as she talked to reporters as she left the summit following bilateral meetings with Tusk, the German chancellor, Angela Merkel, and the leaders of Belgium and Denmark.

Earlier in the day, May made it clear that she was only willing to lay down extra money to meet the EU’s €60bn divorce bill demands only if the bloc’s leaders could guarantee the widening of talks to trade and the terms of a transition period at the summit in December.

She told reporters: “These negotiations are continuing but what I am clear about is that we must step forward together. This is for both the UK and the European Union to move on to the next stage.”

The British government’s irritation at the failure of May’s speech in Florence in September to move talks on to trade discussions has complicated the choreography of the next few days.

The UK’s negotiating team had been led to believe by the EU’s chief negotiator, Michel Barnier, that it would be enough for them to pledge to ensure no member state lost out in the first two years after Brexit and to honour financial commitments made in the past. Germany and France overruled the European commission official, however.

Ireland’s new taoiseach, Leo Varadkar, has been much more sceptical than the UK about the potential for avoiding border posts via virtual checks on importers. Whilst agreeing with British ministers and EU negotiators that it is inconceivable for there to be a return to a hard border with the north, Dublin argues that the best way for the UK to achieve this would be by permanently remaining in a customs union with the EU and seeking single market membership like Norway through the European Economic Area. The UK has conceded that some of this will be necessary in its interim phase after Brexit, but hopes clever technological solutions can allow it have looser economic links in the long run. Varadkar is not alone in being sceptical about whether such a cake-and-eat-it customs and trade strategy is viable.

At a meeting of the Brexit subcommittee of the cabinet last week, it was agreed that the UK would offer more in the coming days than the €20bn put on the table in Florence, in an attempt to move the negotiations on. However, the agreement was struck on the proviso that the EU guaranteed progress on to a second phase of talks at a European council meeting on 14 and 15 December.

The EU member states, however, need to consult their national parliaments, which makes such a guarantee, at the point at which the financial offer is made, almost impossible.

At a meeting of EU ambassadors on Wednesday, it was understood that concerns were shared by many member states that if the standoff continued for much longer there would not be enough time to have an EU position by December.

Merkel will need to present any offer to the Bundestag. The Scandinavian countries also have considerable domestic hurdles to leap before they can give their consent to judging that sufficient progress has been in made in phase one. As one senior EU diplomat said: “The member states are not willing just to rubber-stamp an offer.”.

On the Irish issue, May said the republic and the UK had the same goal, of avoiding a hard border, and that she was talking with Ireland “about solutions for that”. She said: “We have the same desire, we want to ensure that movement of people and trade across that border can carry on as now.”

The Irish foreign minister, Simon Coveney, also made it clear, however, that Dublin would not accept “aspirational” commitments to avoid a hard border and needed “parameters of a road map” to that outcome.

He suggested that the British government had “not been listening” to the Irish. He said that the 26 other member states and Barnier, with whom he held a private meeting on Friday, were firmly united behind the Irish if they wanted to hold talks back in December.

Coveney said: “We can’t move to phase two on the basis of aspiration. We have to move to phase two on the basis of a credible road map, or the parameters around which we can design a credible road map ... We need progress on this issue, in the context of the regulatory-divergence issue. And I hope and expect that we can get that by December so we can all move on. If we can’t, then I think there’s going to be difficulty moving on.”

According to Bloomberg, the British government has privately suggested that the Irish could be given a rolling veto to be played in the second phase of talks, so that they can feel confident in giving their approval for talks to move on.