LDN - Business

No parallel Brexit and trade talks, EU's Barnier insists

[April 05, 2017] By Francesco Guarascio

STRASBOURG (Reuters) - Britain must stop pressing for immediate parallel talks with the European Union on a post-Brexit free trade deal, EU chief negotiator Michel Barnier said on Wednesday, and first agree on withdrawal terms.

Barnier said Prime Minister Theresa May's letter a week ago to trigger the two-year exit process was clearly a call for two parallel negotiations, one on how Britain quits the bloc and another on its future trade relationship with the EU.

"This is a very risky approach," he said in a speech to the European Parliament. "To succeed, we need on the contrary to devote the first phase of negotiations exclusively to reaching an agreement on the principles of the exit."

Those must include providing legal certainty for people and businesses affected by Britain's departure in March 2019, he said. There must also be a border arrangement that assures the fragile peace in Northern Ireland is not upset.

Only after progress on those issues would negotiators start "scoping" a future pact on trade, security and defense, he said.

Barnier said the phased approach, outlined by European Council President Donald Tusk on Friday, was not intended to give the other 27 EU states a tactical advantage over London but to build trust and improve the chances of a deal in 2019.

In a veiled warning to Britain not to try to divide the bloc during the talks, he said: "Unity is essential ... also for our British partners. At the end of the day, if the (European) Union is disunited, there simply will not be an agreement.

"And if there is no agreement, the consequences will be heavy, for the United Kingdom especially, but also for the Union. That is why the no-deal scenario is not our scenario."

May has warned that Britain would rather that talks collapsed, leaving the country to exit the EU in 2019 without special agreements, rather than accept a bad deal.

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EU Brexit negotiator Michel Barnier attends a debate on Brexit priorities and the upcomming talks on the UK's withdrawal from the EU at the European Parliament in Strasbourg, France, April 5, 2017. REUTERS/Vincent Kessler

WAR TALK

The parliament in Strasbourg debated a resolution due to be approved later on Wednesday outlining its demands for a Brexit agreement, which it will have to ratify.

Several members criticized comments by British politicians in recent days about Gibraltar.

Tusk has said Spain should have a say in any future EU-British relationship that affected Gibraltar. A former leader of May's party responded that Britain would be ready for war over Gibraltar as it was over the Falkland Islands in 1982.

"Are we off our heads?" asked Manfred Weber, the German leader of the center-right group, the parliament's biggest.

UK Independence Party leader Paul Nuttall suggested Britain respond by making its overseas territory of Gibraltar, on the southern coast of Spain, an integral part of the United Kingdom.

Nigel Farage, former UKIP leader and still its leader in the European Parliament, called the EU negotiating position "a form of ransom demand".

"You have been vindictive and nasty. You are behaving like the mafia," he said of the bloc. Rebuked by the Italian speaker of parliament, he amended his comparison to "gangsters".

(Additional reporting and writing by Philip Blenkinsop and Alastair Macdonald in Brussels; Editing by Tom Heneghan)

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