Brexit: Trade talks possible in December, amid unresolved issues

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European Council President Donald Tusk said on Friday that he hoped the second phase of Brexit talks could start at the next European Union summit in December, despite EU leaders concluding that Britain had failed to make "sufficient progress" on key issues regarding a withdrawal treaty.

"Brexit conclusions adopted. Leaders green-light internal EU27 preparations for 2nd phase," Tusk said on Twitter.

At the end of an EU summit in Brussels, German Chancellor Angela Merkel said the EU could only agree to enter the next phase of Brexit negotiations in December if Britain moved on its financial obligations to the bloc.

EU Council President Donald Tusk (R) and European Commission President Jean-Claude Juncker attend a joint news conference during an EU summit in Brussels, Belgium, October 20, 2017. /Reuters Photo

British Prime Minister Theresa May said her country would only agree to a detailed financial settlement for Brexit once its future relationship with the EU was agreed. "The full and final settlement will come as part of the final agreement that we're getting in relation to the future partnership," she told reporters at the summit.

May wins warm words

EU leaders shunned May's summit plea to negotiate a post-Brexit trade deal but sweetened the pill for the fragile British prime minister with warm words and a gesture toward future talks.

May asked the other 27 leaders over dinner in Brussels on Thursday to help her quell calls in Britain for her to walk out of deadlocked talks on a divorce settlement by giving assurances they expect to get to a deal in the coming weeks.

A tourist bus passes an anti Brexit protester in London, Britain, October 19, 2017. /Reuters Photo

Tusk said there had been progress on a Brexit deal and that reports of a deadlock had been exaggerated. He described May's speech in Florence on September 22 as "essential" to new momentum on Brexit talks.

Merkel told a late-night news conference on Thursday that the talks were "moving forward step by step," sending a positive signal to May.

"We hope that by December we have moved along enough to allow phase two to begin but that depends on the extent to which Great Britain makes progress so that we can say that it is sufficient on the core themes of phase one," Merkel said at the end of the summit on Friday. "In this the financial settlement is the most prominent theme."

Romanian President Klaus Iohannis said it was clear that the British prime minister was "more positive and result-oriented" after she addressed EU leaders in Brussels.

But French President Emmanuel Macron said the EU and the UK had not completed even half of the work on the Brexit financial settlement.

French President Emmanuel Macron (L) talks with Italian Prime Minister Paolo Gentiloni (C) and German Chancellor Angela Merkel during an EU summit in Brussels, Belgium, October 20, 2017. /Reuters Photo

'Brexit bill' still unresolved

Britain's financial obligations to the bloc when it leaves in March 2019 is one of the main sticking points.

"I have said that nobody need be concerned for the current budget plan, that they will either have to pay in more or receive less as a result of the UK leaving, and we will honor the commitments we have made during our membership," May said.

In her Florence speech, May promised to maintain Britain's contributions for two years to complete the current EU budget period, totaling around 20 billion euros (24 billion US dollars). But this falls short of the EU's estimate of the bill, which European Parliament chief Antonio Tajani said this week was closer to 50 or 60 billion euros.

"There has to be detailed work on those commitments. We're going through them line by line and will continue to go through them line by line. The British taxpayer wouldn't expect its government to do anything else," May added.

British Prime Minister Theresa May addresses a news conference during an EU summit in Brussels, Belgium, October 20, 2017. /Reuters Photo

After May left on Friday morning, the other 27 took less than two minutes to endorse a prepared statement that Britain had failed to make "sufficient progress" on offers to settle three key issues on a withdrawal treaty – namely rights for EU citizens in Britain, the new Irish border and the "Brexit bill."

Although the EU leaders have agreed to start preparatory talks on the bloc's relationship with Britain after Brexit, they still want the money. The text read: "The European Union ... notes that, while the UK has stated that it will honor its financial obligations taken during its membership, this has not yet been translated into a firm and concrete commitment from the UK to settle all of these obligations."

(With inputs from Reuters and AFP)

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