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Boris Johnson will tell the European Union he is prepared to accept border checks in a no-deal like scenario as tensions ratcheted up between the sparring sides.
As the dust settles on Britain's formal EU withdrawal on Friday, attention has turned to the impending trade talks as the prime minister prepares to lay out his post-Brexit vision on Monday in a speech in London.
A Government source told the PA news agency that Mr Johnson would be prepared to accept a Canada-style free trade deal - a checks-lite trade arrangement that would allow tariff-free trade for the majority of goods, but that would not include the UK’s dominant services sector.
The UK's foreign minister Dominic Raab said on Sunday that Britain expects the EU to "live up to" its undertakings to offer London a Canada-style free-trade deal, reiterating that any deal will not require "high alignment" with the bloc's rules.
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Taoiseach Leo Varadkar said on Sunday that Britain and the EU should not set such rigid red lines before talks on a trade deal because that could make it more difficult to secure an agreement.
Mr Varadkar said it was possible for Brussels to offer a Canada-style trade deal but it would need to establish a level playing field.
Infuriated
The UK government is understood to be privately infuriated by what it perceives to be attempts by Brussels to change the terms of the deal struck in October as part of the Withdrawal Agreement.
Reports have surfaced in recent days suggesting EU chiefs want the UK to continue to follow Brussels-made rules on standards and state subsidies, while accepting the jurisdiction of the European Court of Justice (ECJ) over matters relating to any trade deal.
But in what promises to be a combative speech, the PM is expected to tell the EU he will accept no alignment, no jurisdiction of the European courts, and no concessions to any Brussels’ demands when talks start in March.
Analysis undertaken by the Treasury in 2018 predicted that Britain’s economy would be 4.9 per cent worse off under such a deal within 15 years, when compared with expected growth if it had remained in the EU.
If a Canada-esque deal cannot be signed-off, insiders say the UK Government is gearing up to walk away with what is dubbed an “Australia-style” arrangement — a re-branding of a no-deal Brexit.
It would see the UK revert to World Trade Organisation (WTO) rules, with additional mini-deals tacked-on to ensure travel arrangements, such as international flights, can continue.
A Government source told PA: "There are only two likely outcomes in negotiation — a free trade deal like Canada or a looser arrangement like Australia — and we are happy to pursue both."
Warnings
European leaders have already set out their own warnings to Mr Johnson over the upcoming talks.
French President Emmanuel Macron used an article in the UK Times to outline how the level of single market access granted to the UK would "depend on the degree to which the European Union's rules are accepted".
Another area of trouble could be Gibraltar, with Spain reportedly laying down a gauntlet to EU negotiators over the terms of any deal in the offing.
According to the Observer, the EU will back Spain over its territorial claims to the British overseas territory by giving Madrid the power to exclude its population of 34,000 people from any potential trade deal.
In his keynote speech in London on Monday, Mr Johnson is preparing to rule out relaxing rules on workers’ rights, food hygiene standards and environmental protections.
He is also expected, according to Government sources, to confirm UK negotiators will pursue free trade agreements with the likes of the United States, Japan, Australia and New Zealand at the same time as dealing with Brussels.
The Sunday Telegraph reported that a trade deal is earmarked to be agreed with Japan by Christmas, followed by more agreements with Australia and New Zealand in mid 2021.
On top of the tough stance on trade, the Sunday Times reported that British diplomats have been ordered to make a break with their former EU allies in a bid to “adopt a stance as a confident independent country”.
According to a leaked telegram quoted by the paper, foreign secretary Dominic Raab said the UK should be free to “dis-apply EU foreign policy positions” during the 11-month transition period, as Britain prepares to move away from the bloc.
- Agencies