EU and British negotiators reached a trade deal on Wednesday, leaving only a disagreement over fishing, raising hopes that a chaotic economic break between the two sides could be avoided on New Year’s Day just before midnight, officials said. .
After resolving a number of remaining issues of fair competition, the negotiators dealt with EU fisheries rights in UK waters, while working to reach an agreement on a post-Brexit relationship after nine months of talks.
Two EU sources said the negotiations were in the final stages now, with one saying: “I expect to see white smoke tonight.” The official asked not to be identified, as talks were still ongoing.
Customs controls and other barriers will be imposed in all circumstances on 1 January, but a trade agreement would avoid the imposition of tariffs and duties that could cost both sides hundreds of thousands of jobs. The UK withdrew from the EU on 31 January and an economic transition period expires on 31 December.
Rumors of a pre-Christmas trade deal have surfaced in recent days, based on progress on issues beyond fishing. However, some EU countries have insisted that, following close scrutiny, the UK’s latest proposals for quotas for EU vessels in UK waters have been much less conciliatory than first seen.
On Wednesday, the intermediation of quotas and transition periods for EU vessels to continue fishing in UK waters was in full swing, with progress reported by several parties.
In London, UK Cabinet Minister Robert Jenrick said: “We will have to solve these final problems and there is a way forward.” He said he was still optimistic.
The EU has long feared that Britain will undermine the social, environmental and aid rules of the bloc state in order to gain an unfair advantage with its exports to the EU. Britain said compliance with EU rules would undermine its sovereignty. A compromise has been reached on these issues, said a diplomat from an EU country.
If both parties do not meet the January 1 deadline, it is not clear under what conditions the transaction would take place before an agreement is finally approved.
In recent days, British Prime Minister Boris Johnson and European Commission President Ursula von der Leyen have been increasingly involved in talks and have been in telephone contact to unblock negotiations.
Companies on both sides are demanding an agreement that would save tens of billions in costs. Failure to reach a post-Brexit agreement would lead to more chaos on Britain’s borders with the EU in early 2021, when the new tariffs on both sides would add further trade impediments.
The border is already spinning due to new restrictions on travelers from the UK to France and other EU countries due to a new variant of coronavirus crossing London and the south of England. A British minister said on Wednesday that about 4,000 trucks had been blocked in traffic jams near Dover, waiting for their drivers to be tested for viruses so they could enter the Eurotunnel to France.
While both sides would suffer economically from the failure to secure a trade deal, most economists believe the UK will have a bigger blow, at least in the short term, because it is relatively more dependent on trade with the EU. than vice versa.
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