Johnson, EU Warn No Deal Likely as Deadline Nears: Brexit Update
(Bloomberg) -- Prime Minister Boris Johnson and European Commission President Ursula von der Leyen both warned that a no-deal Brexit is looming on Dec. 31 as they continued last-ditch talks to try to reach a deal before Sunday.
Johnson said on Friday that a no-deal Brexit at the end of the year now looks “very, very likely.” But, in an olive branch to the U.K., von der Leyen stressed that any deal wouldn’t infringe British sovereignty -- but her comments were dismissed by a Downing Street spokesman as nothing new.
Both sides have said they will continue discussions until Sunday, but officials concede that, without fresh political direction, the negotiating teams will have little to talk about.
- The EU stressed any deal wouldn’t infringe British sovereignty
- The pound fell as much as 1.2%, hitting a one-month low against the dollar
- Europe’s banking regulator called on firms to step up no-deal preparations
Last-Minute Deal Possible? (6:15 p.m.)
A last minute Brexit trade deal is still possible, Irish Deputy Prime Minister Leo Varadkar said, even as both sides warn that failure is more likely.
“It’s very often the case that these deals are only made at the last moment, because everyone needs to be sure that there was the best deal possible, and there’s nothing else left on the table,” he said in comments broadcast by RTE Radio.
An accord may require “a little bit of compromise from both sides,” he added.
Navy to Be Deployed: Guardian (5:35 p.m)
Britain plans to deploy four naval patrol boats to protect its fishing waters in the event of no deal, the Guardian reported.
The vessels will be able to stop and board EU fishing boats operating in some cases as far away as 200 miles from the U.K. coast, the newspaper said. Two of the navy boats will be at sea while the other two will be on standby.
Regulator Warns Banks (5 p.m.)
Europe’s top banking regulator warned the financial industry to step up preparations for a no-deal Brexit in just three weeks’ time amid signs that trade talks are on the verge of collapse.
Read more: Finance Firms Have More Brexit Preparation Work To Do, EBA Says
Bacon Sandwiches Safe, Danes Say (4 p.m.)
Esbjerg, the main Danish port for shipping butter and bacon to the U.K., isn’t expecting disruptions if a so-called hard Brexit becomes a reality.
The port has invested in an extra customs house and food inspections facilities, Dennis Jul Pedersen, its chief executive officer, said by phone on Friday.
“We’re ready for a hard Brexit and that’s also what looks likely to happen,” Jul Pedersen said. “I doubt we will see any panic, because there has been so much time now to prepare.”
Sovereignty Stressed (2:45 p.m.)
At her press conference on Friday, Ursula von der Leyen was at pains to stress that a trade won’t impinge on the U.K.’s sovereignty, one of Boris Johnson’s red lines in the negotiations.
“Every time we decide to raise our level of ambition, for example, in the environmental field they would remain free -- sovereign if you wish -- to decide what they want to do,” she said. “We would simply adapt the conditions for access to our market accordingly.”
In an apparent effort to reassure the U.K. government, Irish Foreign Minister Simon Coveney later said “nobody is questioning British sovereignty or British control.”
“Britain will be an independent, sovereign state,” Coveney told reporters in Berlin. “But that doesn’t mean, as part of an overall trade deal, that that there can’t be agreements with that sovereign state to ensure that EU interests are protected too.”
Germany Hints Talks Could Go On (2:33 p.m.)
“I hope there will be a solution by the weekend,” German Foreign Affairs Minister Heiko Maas said.”In the end, it wouldn’t fail if a few more days were given. But both sides really know all details of what is essential and on that basis a compromise would need to be built.”
Austrian: No Accord Would Be ‘Absurd’ (2:30 p.m.)
“I believe the European Union is always best under pressure, and pressure has been mounting,” Austrian Foreign Minister Alexander Schallenberg said at a press conference in Lisbon with his Portuguese counterpart Augusto Santos Silva. “I would say after two and a half years of divorce negotiations to step out of the room without any divorce treaty at the end of the day is absurd.”
“I believe that until next Sunday an agreement can be reached,” Santos Silva said. “We are already prepared for all scenarios including the no-deal scenario. If there is no deal we have to take the appropriate measures to avoid any kind of disruption in terms of mobility, transport and economic links. It is very important to reach an agreement with the U.K. on the future relationship.”
Johnson No-Deal ‘Very, Very Likely’ (12:41 p.m.)
Boris Johnson repeated his Thursday warning that Britain is set to end the Brexit transition period on Dec. 31 without a trade deal in place.
PM Ready to Talk ‘Whenever They Want’ (12:40 p.m.)
Boris Johnson is committed to exploring every last avenue for a trade deal with the EU, and has told his negotiators to keep going, Downing Street spokesman Shaun Jepson told reporters on Friday.
“The prime minister has a clear willingness to talk to other leaders,” Jepson said. “We’ll go the extra mile.”
Italy’s Conte: EU Mustn’t Yield (12:28 p.m.)
Italian Prime Minister Giuseppe Conte, speaking after the EU summit, told reporters the bloc cannot yield on the issues of the level playing field and governance of any agreement.
“If these issues are not unblocked, unfortunately everything becomes very complicated,” Conte said. “Time is running out, we must prepare for a hard Brexit,” he added. “It is not what we want, but we must be ready.”
Germany Wants Deal, But Not At Any Price (11:25 a.m.)
Angela Merkel’s deputy spokeswoman reacted coldly when asked if the chancellor would be willing to join Johnson and Macron at another Brexit meeting.
“I cannot tell you about any further appointments of the Chancellor. As we all see, the Brexit negotiations are difficult and there is only little time left,” Martina Fietz said in Berlin. “We will wait for the result of the negotiations until Sunday.”
“The Chancellery still thinks that an agreement would be the best solution for both sides,” she said. “The EU is willing to reach an agreement, but not at any price.”
Norway May Close Waters to U.K., EU (11:10 a.m.)
Norway may close its waters to fishing vessels from the EU and U.K. if a deal isn’t reached with the Nordic country by the start of next year, Norwegian news agency NTB reported, citing Fisheries and Seafood Minister Odd Emil Ingebrigtsen.
Negotiations are delayed due to the Brexit talks and it isn’t a given that deals will be finalized by the end of the year. Norway also can’t expect its vessels to have access to EU or U.K. economic zones before agreements are in place.
Slovenia Says Expectations Are Low (10:55 a.m.)
Slovenian Prime Minister Janez Jansa said there are low expectations a post-Brexit trade deal will be secured in the coming days,
A solution isn’t completely out of reach, but the negotiation stances remain as far apart as they were more than a week ago, he said following the summit of European Union leaders in Brussels.
“Expectations are low, not high unfortunately,” Jansa said. “It’s not impossible to come to a solution in the coming days, but there are as many questions open as there were 10 days ago.”
Macron: We’re Still Looking for Deal (10:50 a.m.)
Emmanuel Macron said, amid “rumors, fire and counter-fires,” he still wants a deal that “respects our British friends.”
The French president dodged a question on whether his wish to see French fishermen continuing to fish in U.K. waters after a no deal was an attempt to “have his cake and eat it too” -- an expression used by Johnson in describing his own views on Brexit.
“I am asking for the butter to be well weighed, because I am not giving up my share too,” Macron responded, repeating that the EU had “one principle: standing united.”
Von der Leyen Stresses U.K. Sovereignty (10:25 a.m.)
Ursula von der Leyen used her press conference after the EU summit to focus on the bloc’s negotiating positions rather than warn they’re heading for no deal, a sign perhaps that they’re not quite at the end of the road yet.
On the so-called level playing field for fair competition -- the biggest obstacle to an agreement -- she emphasized British “sovereignty,” the key U.K. demand.
Under the EU’s proposal rejected by Johnson’s government, “the U.K. would remain free -- sovereign if you wish -- to decide what they want to do,” she said. “We would adapt the conditions for access to our market according to the decision of the U.K. and this would apply vice-versa.”
She also indicated it may not be a clear deal or no deal at the weekend. “We will decide on Sunday whether we have conditions for an agreement or not,” she said.
U.K. Slow to Recognize Trade-Offs (9:30 a.m.)
David Lidington, who served as Prime Minister Theresa May’s de facto deputy, said the U.K. has been slow to recognize and explain that any deal will require trade-offs.
“We are wanting privileged access -- tariff-free, quota-free -- to this very important market of the EU, by far our biggest trading partner anywhere in the world, and they are going to demand a price,” he told Bloomberg Television’s Francine Lacqua.
Lidington said he hoped Johnson will strike a deal and that, if the prime minister did secure one, he would be able to get parliamentary approval for it.
BOE Warns of Possible Disruption (9:12 a.m.)
The Bank of England said it can’t rule out market volatility or some disruption to financial services in the event of a no-deal Brexit, but said Britain’s banks are strong enough to weather such an outcome.
Speaking after the BOE published its latest health check of the banking system, Governor Andrew Bailey said the institution had done a huge amount of work to prepare for any form of Brexit. But he cautioned that the EU hadn’t matched those preparations in every respect.
Von der Leyen: No-Deal More Likely (8:30 a.m.)
European Commission President Ursula von der Leyen, who met Johnson on Wednesday, told the summit of EU leaders that no deal is now the more likely option, according to two European officials.
In a 10-minute briefing to the 27 leaders, she told them the main obstacles remain in the talks.
Deal, But Not at Any Price, Dowden Says (8:05 a.m.)
“We would much prefer a Canada-style deal and that is what we have been working towards, but this can’t be at any price,” Culture Secretary Oliver Dowden told the BBC.
“What we will not accept is this ratcheting up -- that if the EU decides to impose fresh regulations that have nothing to do with us, we have to then match them or face the consequences -- they don’t demand that of Canada.”
Brexit Road Testing Starts (7:25 a.m.)
Part of the main motorway to Dover and the Channel Tunnel will be closed overnight on Friday as officials install a new movable barrier.
The contraflow system is designed keep traffic flowing in the event of Brexit-related disruption.
Johnson has “Lost the Plot,” Labour Says (7:10 a.m.)
Lisa Nandy, foreign affairs spokeswoman for the U.K.’s opposition Labour Party, said Johnson’s government has “lost the plot” over the Brexit talks and urged the prime minister to agree a deal with the EU.
“The government’s position is now that it’s intolerable to accept tariffs and quotas, so they want to leave on terms that immediately introduce tariffs and quotas,” Nandy told BBC Radio. “It just seems absolutely absurd.”
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