Brexit: Brussels punctures optimism that deal is
in sight
EU sources fear Boris Johnson hasn’t yet got backing
for compromises on state aid to business
Daniel
Boffey and Jennifer Rankin in Brussels and Lisa O'Carroll in London
Fri 25 Sep
2020 17.44 BST
Brussels
has sought to puncture an outbreak of optimism over an imminent Brexit deal,
amid fears Boris Johnson has not secured the backing of key advisers and his
party for the compromises needed in the final stretch of negotiations.
With the UK
government yet to offer a way forward on the most contentious issues, and trust
in Downing Street at a low ebb, senior EU officials treated with scepticism
reports that the UK could see a way to secure a deal.
The EU’s
chief negotiator, Michel Barnier, told ministers from the 27 member states this
week that there was “a more open atmosphere at the negotiating table”,
according to diplomatic sources in Brussels. But he had also emphasised that
“substantial differences of opinion remain, particularly on a level playing
field” – the issue of state aid to businesses.
While
Downing Street is keen to move into intensive “tunnel” negotiations to allow
both sides to be creative before emerging at the leaders’ summit on 15 October
with a solution to the most intransigent problems, Brussels is not convinced
the prime minister yet has the support of his colleagues to commit to what
might emerge.
“We cannot
trust this prime minister’s word, so the EU member states are not yet willing
to go blind into a tunnel negotiation and see what happens,” said one source.
“It will take more than David Frost [the UK’s chief negotiator] telling us
Johnson wants a deal.”
When the
next round of negotiations opens next week, the EU is hoping Frost will present
a compromise proposal on the key issue of control of state aid to businesses.
“There is better mood music but no substance yet from London to justify it,”
one diplomatic source said.
The UK has
insisted it will not go beyond the World Trade Organisation provisions on state
aid, which would allow either side to take counter measures where trade had
been unfairly distorted – a position that the EU does not believe offers
sufficient assurances of fair competition.
Barnier had
told the EU affairs ministers this week that “recent developments compel us to
be more vigilant on enforcement and dispute resolution” in the trade and
security deal, according to a senior diplomat.
The
European council president, Charles Michel, tweeted on Friday: “From now on, we
will better enforce the level playing field, in a market open to those who
respect its standards. Whether they leave our union or want to move closer to
it.”
EU leaders
will meet at the end of next week to discuss foreign policy issues and to be
briefed by Barnier. But sources downplayed any suggestion that the heads of
state and government would make a decisive intervention.
EU
officials were on Friday unsure how to read an article by the political editor
of the Spectator, James Forsyth, which said Downing Street could see “a deal is
coming into view” and extolling the benefits for Johnson’s premiership.
A UK
government official rejected the hope of an imminent breakthrough saying “there
remains a lot of work to do and either outcome is still possible” warning the
EU had to be “realistic” in the coming days.
The
official said the “differences on fisheries and the level playing field remain
significant … if the gaps in these areas are to be bridged, the EU’s more constructive
attitude will need to be translated into more realistic policy positions in the
days to come.”
“Is this
them preparing the way for a deal, or to blame the EU for a lack of
flexibility,” asked one EU official. “There hasn’t been any major progress in
the last informal talks. Maybe there will be a breakthrough but there isn’t
anything there yet.”
EU officials
have suggested that a deal on the further difficult issue of access by European
fishing fleets to UK waters would, however, follow if agreement on state aid
could be found before the leaders’ summit on 15 October.
One of the
key indicators of the progress of the talks will be the future timetabling of
the internal market bill and the promised finance bill, which has yet to be
tabled.
The
government intends to publish plans for the progress of the internal market
bill, which threatens to override parts of the Brexit withdrawal agreement,
through parliament at the end of next week. If progress of the bill is slowed
down it will be seen as a temporary “removal of the gun from the table”, given
the EU has threatened legal action if it has not been stood down by the end of
next week, one insider suggested.
It is
understood that “good progress” was being made regarding checks in the Irish
Sea before the internal market bill blew talks off course. If a meeting between
the Cabinet Office minister, Michael Gove, and his EU counterpart on Monday is
successful, it could be used by the UK as a chance to claim “victory” over the
EU and row back on the offensive elements of the internal market bill.
But the UK
is keeping a further card in reserve in the form of the finance bill, which a
source said “could look worse than the internal market bill” in terms of the
withdrawal agreement’s Northern Ireland protocol, and potentially destabilise
the trade and security negotiations. “Whether or not that is published soon
will feed into the escalation or the de-escalation, of talks,” said the source.
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