EU chief negotiator Michel Barnier warned on Monday of the risk of a sudden breakdown in trade between the United Kingdom and the European Union if they fail to agree this year on their future relationship after Brexit.
"The first phase is now over and we have to rebuild everything," said Michel Barnier, four days before the divorce, at a press conference in Dublin, where he met with Irish Prime Minister Leo Varadkar.
Risk of a precipice
"At the end of the year (...), if we do not agree, it will not be the usual routine and the status quo," he continued. "We have to face the risk of being on the brink, especially with regard to trade."
In the absence of a commercial agreement, economic relations between Brussels and London would be governed by the rules of the World Trade Organization (WTO), which are much less advantageous because they fix customs duties for goods.
Precious time
Michel Barnier also stressed that the two parties have "very little time" to complete during the transition period, which runs until the end of 2020, as British Prime Minister Boris Johnson wants. In addition to their commercial relationship, the two parties will have to agree on security, energy, fishing or transport.
Michel Barnier said he would present a draft negotiating mandate to member states next Monday, after the divorce agreement which regulates the terms of separation.
Alignment of European rules
The European mandate should be approved at ministerial level by February 25, according to European officials, allowing talks to start around March 1. In a speech scheduled for early February, Boris Johnson must present his ambitions to reach a free trade agreement of the same type as that signed by the EU with Canada recently, without alignment with European rules.
But Michel Barnier recalled that "the level of access" to the European single market from which British goods will benefit will be "proportional" to the degree of alignment of the United Kingdom with European rules, "in particular the aid rules of State ”.
Difficult timetable and uncertain future
Prime Minister Leo Varadkar, for his part, estimated that the European Union was approaching the negotiations "in a very strong position": "we are 27 countries, we have a population of 450 million people and the single market is the first world economy ", he said.
The leader, who plays his maintenance at the head of the Irish government during early legislative elections on February 8, also found the timetable "very difficult", while considering "possible (...) to build a very close partnership".
Partial agreements
Boris Johnson enshrined in the law implementing the divorce agreement negotiated with the EU, promulgated Thursday in the United Kingdom, the prohibition for his government to request an extension of the transition period after 2020.
In a BBC interview, Leo Varadkar warned against any attempt by London to reach partial deals. However, he undertook to work "day and night" to try to reach a global compromise before the end of the year: "we will not drag our feet".
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