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EU and Japan create world’s biggest free trade zone

Almost all tariffs on trade between the European Union and the world's third-biggest economy have been removed. European companies could save around a billion euros in duties each year. A free trade agreement between Japan and the EU entered into force on February 1, covering 635 million people and almost one-third of the world's economy. Dubbed the world's largest free trade agreement, the EU-Japan Economic Partnership Agreement removes duties on almost all agricultural and industrial products and opens up the service sector and procurement. It also moves to eliminate non-tariff barriers to trade. The highlights of the deal Japan will have scrappped duties on 97 percent of goods imported from the EU once the agreement is fully implemented. Open access to the Japanese market will save EU companies from paying €1 billion ($1.14 billion) of duties annually. The EU will eliminate tariffs on 99 percent of imports from Japan. In the automotive sector, the EU will eliminate duties over a seven-year transition period. Both sides will eliminate duties on nearly all food and agricultural products. The service market will be opened, including financial services, e-commerce, telecommunications and transport. For the first time, the trade agreement includes countries' Paris climate deal commitments. The text also addresses sustainable development and sets standards for labor, safety, environmental and consumer protection. 'Protecting brand names' EU Trade Commissioner Cecilia Malmstrom said: "This agreement has it all: it scraps tariffs and contributes to the global rulebook, whilst at the same time demonstrating to the world that we both remain convinced by the benefits of open trade." The president of the European Commission, Jean-Claude Juncker, said: "The new agreement will give consumers greater choice and cheaper prices; it will protect great European products in Japan and vice-versa, such as the Austrian Tiroler Speck or Kobe Beef; it will give small businesses on both sides the chance to branch out to a completely new market; it will save European companies 1 billion euro in duties every year and turbo-boost the trade we already do together." Trade groups also welcomed the move. "This agreement is the perfect example that building bridges is better than raising walls," said Pierre Gattaz, president of BusinessEurope. "When protectionism is on the rise, the EU and Japan show to the world they remain open to modern and rules-based trade." Hiroaki Nakanishi, chairman of the Japan Business Federation, said the agreement "will stimulate additional growth and create jobs for both sides." What is the status of EU-Japan trade? Japan is the EU’s second-largest trade partner in Asia after China. EU businesses export €58 billion in goods and €28 billion in services to Japan every year. The EU estimates exports to Japan will increase 13 percent, or €13 billion, as a result of the free trade zone. Japan exports €69 billion in goods and €18 billion in services to the EU annually. How did we get here and what’s next? The EU and Japan began negotiations for a free trade agreement in 2013. The European Parliament and Japan’s parliament approved the deal last year after both sides finalized negotiations in December 2017. EU and Japan are continuing investment protection negotiations and hope to reach an understanding as soon as possible.

Almost all tariffs on trade between the European Union and the world’s third-biggest economy have been removed. European companies could save around a billion euros in duties each year. A free trade agreement between Japan and the EU entered into force on February 1, covering 635 million people and almost one-third of the world’s economy. Dubbed the world’s largest free ... Read More »

EU to grant Britain visa-free travel even with no-deal Brexit

EU nations have agreed to give the UK citizens visa-free travel even at the event of a no-deal Brexit. However, London responded with anger after the bloc described Gibraltar as a British "colony." If Britain leaves the European Union without a deal, UK citizens should still be able to visit the bloc visa-free for up to 90 days, ambassadors of the remaining 27 EU nations said on Friday. The 90 days can be taken in any 180-day period, the envoys said in Brussels. In a statement published on the European Council website, ambassadors said that the visa exemption was "granted on condition of reciprocity," meaning that the UK was also expected not to demand visas from EU citizens for short stays. "In the event that the United Kingdom introduces a visa requirement for nationals of at least one member state in the future, the existing reciprocity mechanism would apply and the (EU) would commit to act without delay in applying the mechanism," they warned. If adopted, the legislation would put British nationals in line with citizens of Canada and Australia, who are also allowed to visit the EU Shenghen area without visas for 90 days. However, the proposal is separate from a long-term EU regulation, effective in 2020, that sets up a "pre-authorization" for travel by visitors from countries where the EU does not require a visa, at present more than 60. Under this system, visitors can travel in and out of the EU for three yearrs for a €7 ($8). Britain will join this group after Brexit. At the same time, the document irritated London by imposing new distinctions between UK citizens living in Gibraltar and the ones living on the British Isles, according to the Reuters news agency. The proposed legislation also described Gibraltar as a "colony of the British Crown" and said its sovereignty was disputed by Spain. "There is a controversy between Spain and the United Kingdom concerning the sovereignty over Gibraltar, a territory for which a solution has to be reached in light of the relevant resolutions and decisions of the General Assembly of the United Nations," the document said. London regards the strategically important region at the tip of the Iberian Peninsula as a British Overseas Territory. "Gibraltar is not a colony and it is completely inappropriate to describe in this way," a spokeswoman for London said on Friday. With the UK set to leave the EU on March 29, Spain is increasing its claims to the neighboring territory.

EU nations have agreed to give the UK citizens visa-free travel even at the event of a no-deal Brexit. However, London responded with anger after the bloc described Gibraltar as a British “colony.” If Britain leaves the European Union without a deal, UK citizens should still be able to visit the bloc visa-free for up to 90 days, ambassadors of ... Read More »

Brexit: Britain’s Theresa May holds pre-summit talks

British Prime Minister Theresa May is to hold talks with key EU leaders ahead of a summit to endorse her Brexit deal. But resistance at home and abroad continues to dog negotiations. British Prime Minister Theresa May is to hold last-minute talks with European Commission President Jean-Claude Juncker and European Council President Donald Tusk on the eve of an EU summit that could still be blocked by Spanish objections to her deal on Britain's withdrawal from the bloc. Spain has threatened to veto the deal unless the wording is changed to give Madrid guarantees that it alone can decide on the future of the disputed territory of Gibraltar in direct talks with London. May hopes nonetheless to leave Brussels on Sunday with the terms of British withdrawal on March 29 and a comprehensive concept for future Britain-EU relations settled with the bloc. Northern Irish opposition The British premier is, however, also facing opposition closer to home, with the Democratic Union Party (DUP) of Northern Ireland, whose support is vital to her government, holding a conference on Saturday. The right-wing and "Christian fundamentalist" DUP, which is in favor of Brtish rule in Northern Ireland, believes that the deal's backstop provision to ensure an open border on the island of Ireland will give the province a different economic status compared with the mainland. This, it fears, could increase the chances of Irish unification, which it vigorously rejects. Getting the DUP on board will be highly important to May if the deal is to be passed by the British Parliament, where May's Conservative Party only has a minority. The Conservatives have a "confidence-and-supply" arrangement with the DUP's 10 members of parliament, allowing them an effective majority. No-deal warning The expected presence of Britain's finance minister, Philip Hammond, at Saturday's conference underlines the central role the highly conservative party now plays. Hammond on Saturday reiterated his support for May's draft deal on Saturday, telling broadcaster BBC that it was "a way of Britain leaving the European Union ... with minimum negative impact on our economy." At the same time, he warned that no deal would mean "very serious" consequences in the future for the economy, jobs and prosperity. The conference will also be attended by former Foreign Secretary Boris Johnson, a vehement critic of the deal, and Fabian Picardo, the chief minister of Gibraltar.

British Prime Minister Theresa May is to hold talks with key EU leaders ahead of a summit to endorse her Brexit deal. But resistance at home and abroad continues to dog negotiations. British Prime Minister Theresa May is to hold last-minute talks with European Commission President Jean-Claude Juncker and European Council President Donald Tusk on the eve of an EU ... Read More »

Germany cautious as France leads European defense initiative

France is leading a 10-country defense initiative in a bid to "face new threats" outside existing structures. Germany is wary that the project could entangle its military in foreign interventions and undermine the EU. Defense ministers from 10 European countries gathered in Paris on Wednesday to set the agenda for the European Intervention Initiative (EI2), a defense coalition spearheaded by French President Emmanuel Macron. "To face new threats, Europe needs a strong defense," the French Defense Ministry said in a tweet after the meeting. "With the European Intervention Initiative, 10 European countries are committed to its protection." EI2's goal is to create a results-based common strategic culture that allows for rapid response joint military operations, including in humanitarian efforts. As such, it is not aimed at establishing a supranational European army. However, as an initiative outside EU and NATO frameworks, the French Defense Ministry has tried to alleviate concerns that it would undermine defense structures in the bloc and alliance. "With the European Intervention Initiative, the whole European Union and the European pillar in NATO will also be strengthened," it added. Germany felt pressured' But France's efforts have done little to placate concerns in Berlin, which Paris sees as a pivotal actor in the initiative. Claudia Major, senior international security associate at the Berlin-based German Institute for International and Security Affairs (SWP), told DW that German officials are wary because "it's explicitly and deliberately organized and set up outside the European Union's structures." "For the Germans, making a deliberate attempt to setting up something meaningful outside the EU's structures — and outside NATO — is not seen as a positive move but rather as undermining the EU," Major said. "In the end, Germany felt pressured to agree and engage in the initiative, because otherwise all the talk about France and Germany being the engine of Europe and the heart of Europe, and driving European integration and cooperation forward, would look cheap, wouldn't it?" Fear of 'military adventures' Observers have suggested the initiative poses other challenges for Germany, especially in terms of possible military interventions abroad. Others have even highlighted that the French-led initiative could be used as a means to reinforce Paris' foreign policy objectives. "Berlin has watered down every French proposal for fear of being drawn into ill-considered military adventures in Africa," Philipp Rotmann, associate director of the Global Public Policy Institute, told DW. "But I haven't heard any ambitious, practical proposals from Paris, either — so either the French were too timid in the face of German opposition, or they just hoped that everyone would sign up to taking over the French way of when and how to use military force." Due to Germany's wartime past, the country's armed forces, known as the Bundeswehr, must receive parliamentary approval for military operations on foreign soil. German officials are worried this could be muddied by elements of the initiative. Bundeswehr sources have also pointed to France's decision to disengage militarily in other areas, including Afghanistan and Kosovo, as a cautionary sign of the initiative's purpose, according to the Reuters news agency. Change on the horizon Wednesday's meeting came a day after Macron called for a "real European army" to be established as a means to wean Europe off of US defense guarantees, especially after US President Donald Trump threatened to moderate Washington's commitment to the continent. "We need a Europe which defends itself better alone, without just depending on the United States," Macron said. The initiative comprises Germany, the UK, Spain, the Netherlands, Belgium, Denmark, Estonia, Portugal, Finland and France. While dreams of a supranational European military force remain elusive, Macron's vision for a flexible defense coalition may be just around the corner, even with a cautious Germany.

France is leading a 10-country defense initiative in a bid to “face new threats” outside existing structures. Germany is wary that the project could entangle its military in foreign interventions and undermine the EU. Defense ministers from 10 European countries gathered in Paris on Wednesday to set the agenda for the European Intervention Initiative (EI2), a defense coalition spearheaded by ... Read More »

EU: No Brexit deal without Irish backstop

The EU's chief negotiator Michel Barnier will seek a full exit agreement with Britain, provided a solution is found to keep the Irish border open. Otherwise, Britain faces a no-deal, no transition divorce from the bloc. The European Union will not approve a Brexit deal unless it permanently avoids a hard border between Ireland and Northern Ireland, the EU’s chief negotiator said on Tuesday. Michel Barnier's comments lay bare the EU's unequivocal position on the situation in Ireland after the UK leaves the bloc. What Barnier said Speaking at a joint news conference with Slovakia's Prime Minister Peter Pellegrini, Barnier said: • "Without an operational backstop there will not be an accord and there will not be a transition period. That is certain." • The EU is trying to improve its offer to keep the Irish border open, regardless of how Brexit proceeds. • The open border "cannot have an end-date. It must be applicable unless and until another solution is found." • UK demands time limit for backstop • British Prime Minister Theresa May told her cabinet that she was not going to accept a Brexit deal "at any cost." • "This includes ensuring that, if the backstop is ever needed, it is not permanent and there's a mechanism to ensure that the UK could not be held in the arrangement indefinitely." • Irish Prime Minister Leo Varadkar said he was willing to explore backstop solutions so long as they did not allow the UK to unilaterally walk away from an open border. • What is the backstop? The so-called backstop is a plan to keep the Irish border open even in the event of no final deal on the issue. It would keep Northern Ireland in the EU Customs Union and large parts of the single market, creating a de facto border in the Irish Sea. The Northern Irish Democratic Unionist Party, which props up May's Conservative government, strongly rejects the idea, as it would threaten the integrity of the UK and increase chances of a united Ireland — a red line for most Unionists. • Why is an open border so important? In the late sixties, tensions in Northern Ireland between mostly Protestant loyalists and mostly Catholic nationalists boiled over into a 30-year guerilla war known as The Troubles. In 1998, after more than 3,500 deaths and almost 50,000 injuries, peace was brokered with the signing of the Good Friday Agreement. A fundamental part of that deal was the opening of the century-old Irish border, allowing Irish Nationalists to feel a part of Ireland and letting Unionists continue their wish of staying in the UK. Victims of the conflict fear that closing the border could reignite sectarian tensions, which still bubbles beneath the surface today.

The EU’s chief negotiator Michel Barnier will seek a full exit agreement with Britain, provided a solution is found to keep the Irish border open. Otherwise, Britain faces a no-deal, no transition divorce from the bloc. The European Union will not approve a Brexit deal unless it permanently avoids a hard border between Ireland and Northern Ireland, the EU’s chief ... Read More »

Iran sanctions: 5 things to know

On Monday, fresh US sanctions against Iran come into effect, the next salvo in its economic conflict with Tehran. The main targets are oil exports and the financial sector. Europe is having difficulty forming a response. Which sanctions are going into effect? US punitive sanctions are aimed at Iran's economic heart: energy exports. All business with Iranian oil companies will be prohibited, as are insurances of any kind, including policies on oil shipments. Existing sanctions on Iran's financial sector will also be tightened — from Monday onward, all financial transactions with Iran's central bank and a number of other banks will be banned. The US is intent on bringing Iranian oil exports to zero. Oil sales account for some 80 percent of all state income in Iran and since 60 percent of Iran's budget expenditures are distributed to state-run businesses and institutions the country is extremely dependent upon the revenue they produce. What sanctions had been in place already? When it unilaterally withdrew from the Joint Comprehensive Plan of Action (JCPOA) — also known as the Iran nuclear deal — on May 8, the US gave its partners two deadlines to wind down business with Iran. The first 60-day deadline came on August 6. At that point Iran was barred from trading in US dollars. Key Iranian industries such as the automotive sector and carpet production were also sanctioned. The sale of commercial airliners or replacement parts for existing models — access to which had already been greatly hampered — were forbidden entirely. The second deadline was set for November 5. What is the aim of the sanctions? According to the Trump administration, "maximum pressure" on Iran is a tool to force Iranian leaders to change course. On May 21, Secretary of State Mike Pompeo presented a list of 12 demands that the US said must be met before sanctions would be lifted. Among other things, Tehran had to stop its missile program, and "end support to Middle East terrorist groups, including Hezbollah, Hamas and the Palestinian Islamic Jihad." Furthermore, Pompeo said Iran must remove all troops under its command from Syria and demobilize Shiite militias in Iraq. Regime change is not among the declared aims of US sanctions. Nevertheless, public statements by National Security Adviser John Bolton suggest that destabilization and regime change would be more than welcome from Washington's perspective. Can the EU defend itself against unilateral US sanctions? The US is using its predominance in global financial markets and its comparative attractiveness as a place to do business as opposed to Iran, as leverage in pursuing its political aims. As a result, measures that essentially allow Washington to regulate European and other international businesses have been correspondingly harsh. In late September, the EU's chief diplomat, Federica Mogherini, announced that the EU was developing a mechanism known as a Special Purpose Vehicle (SPV) to facilitate business transactions with Iran. The SPV would operate like an exchange, allowing European and Iranian businesses to settle accounts with one another at an EU clearing house. Oil deliveries, for example, could be paid for with textile production machinery. The set-up would make the flow of cash across international financial markets disappear. That said, the SPV is far from operational and no one knows where the institution will actually be based. While announcements of new EU institutions generally draw a great amount of attention from those eager to host their headquarters, that has not been the case with the SPV. European member states have been loath to volunteer for fear of drawing Washington's ire. Trump's security adviser Bolton threatened that the USA would not "allow our sanctions to be evaded by Europe or anybody else." What effect have sanctions had so far? Iran's currency, the rial, is in free fall, having lost 70 percent of its value this year and inflation is skyrocketing. Iranian energy exports have dropped by almost a third since June. Rising energy costs — which are painfully felt at the country's gas stations — are also tied to shortages brought on by sanctions. After a short honeymoon of cooperation and international investment in Iran, many international companies have headed for the exit since May. Among those who left were manyEuropean businesses fearful of being locked out of the far more lucrative American marketshould they stay. Imports to Iran have been greatly hampered across the board. Life-saving drugs, for instance, have become hard to find and are extremely expensive. Still, Iran has years of experience in dealing with US sanctions and has announced its shift to a "resistance economy." From a political standpoint, Washington's sanctions only bolster Iran's ultra-conservative forces, who have always been critical of any form of rapprochement with the West. Moreover, Washington's one-sided withdrawal from the JCPOA nuclear agreement and the implementation of unilateral sanctions have deepened the trans-Atlantic divide. Now, Europe is standing side by side with Beijing and Moscow and against Washington in one of the central international questions of our day.

On Monday, fresh US sanctions against Iran come into effect, the next salvo in its economic conflict with Tehran. The main targets are oil exports and the financial sector. Europe is having difficulty forming a response. Which sanctions are going into effect? US punitive sanctions are aimed at Iran’s economic heart: energy exports. All business with Iranian oil companies will ... Read More »

Italian bonds hit over possible EU revision of 2019 budget plan

The EU's budget commissioner has said there are still concerns that the Italian budget could be sent back for revisions. If so, it would be an unprecedented move. The European Commission has until Monday to raise concerns over the 2019 budget sent by the Italian government to Brussels for review. All EU member states are obliged to make sure their budgets do not breach the Stability and Growth Pact, the EU’s fiscal rule book. European Commissioner Günther Oettinger denied a report in Der Spiegel that his fellow Commissioner Pierre Moscovici had sent a letter to Rome which should arrive on Thursday or Friday, rejecting the budget. "It is my personal opinion that based on the figures it is v (very) likely that we have to ask Italy to correct the draft budget," Oettinger said on Wednesday as he refuted the report. "I did NOT say there is a Commission decision on #Italy, nor that a letter w/ a rejection is being sent this Thursday Friday #Italien #Salvini," he wrote, in English via Twitter. If the Italian government is asked to change its budget, it would be an unprecedented move. Should any corrections fail to appear, the Commission eventually has the power to recommend opening an excessive deficit procedure, setting out a fiscal path for Italy to balance its public accounts. Salvini's reaction Speaking at a business conference in Moscow on Wednesday, deputy premier and far-right League party leader Matteo Salvini appealed to Brussels, Berlin and Paris to take care of their "own economies" and "let the Italian government take care of Italians." He added that it was no wonder that a Eurobarometer poll on Wednesday showed only 44 percent of Italians would vote to stay in the EU in a referendum. Salvini also said that Italy would not support any renewal of EU sanctions on Russia, due to expire in January. "If we are asked to confirm (the sanctions), we will say no," Salvini said in an online media post from Moscow. "It's clear that it makes no sense that they are in place." Bond reaction The budget sent by Italy earlier in the week includes plans to boost welfare spending, cut the retirement age and limit some taxes. Almost two-thirds of the spending hike of €36.7 billion ($42.35 billion dollars) would be funded by a higher deficit in 2019. While the 2.4 percent deficit projected for 2019 is well below the EU's 3 percent limit, it is up sharply from a targeted 1.8 percent this year. Brussels could indicate the Italian budget plan would be in breach of EU fiscal rules that require Rome to reduce its public debt, which already stands at more than 130 per cent of its gross domestic product (GDP), one of the highest levels in the world. Italian bond yields rose again on Wednesday and the 10-year government bond yield rose to 3.54 percent, pushing the gap over German Bund yields back above 300 basis points.

The EU’s budget commissioner has said there are still concerns that the Italian budget could be sent back for revisions. If so, it would be an unprecedented move. The European Commission has until Monday to raise concerns over the 2019 budget sent by the Italian government to Brussels for review. All EU member states are obliged to make sure their ... Read More »

EU leaders formally approve second Brexit phase

The EU has given the formal green light for a second phase of negotiations on Britain's departure from the bloc. The talks will now focus on a transition period and the future trading relationship between the two sides. EU leaders meeting in Brussels said on Friday that the way was clear for the opening of the second phase of Brexit negotiations with the UK. European Council Donald Tusk announced the agreement on Twitter, at the same time congratulating British Prime Minister Theresa May on having brought the divorce settlement negotiations thus far. "As for the framework for future relations, it is now time for internal EU 27 preparations and exploratory contacts with the UK to get more clarity on their vision," Tusk later said, referring to the 27 EU member states that will remain after Britain's departure. Friday's approval gives May a welcome success after she lost a parliamentary vote over giving lawmakers the ultimate say on the final Brexit deal. She showed her gratitude in a tweet that thanked the EU for "an important step" toward a "smooth and orderly Brexit." Even harder second phase? However, Friday's approval appears to be just one of many hurdles to be taken before Brexit occurs, with German Chancellor Angela Merkel telling a press conference following the summit that even more difficult work lay ahead. "We have taken a good step forward. The second phase can begin — but with that, an even harder piece of work begins than what we had so far," she said, adding that the other EU nations had preserved their unity "wonderfully" up to now in the Brexit negotiations. At the press conference, French President Emmanuel Macron also emphasized the way the EU 27 had held together. "We were able to maintain the 27's unity, the integrity of the single market and the respect of common rules," he said, adding that the same principles would remain in the next phase of talks. Thorny issues The two sides agreed last week that enough progress had been made on key issues for negotiations to progress. Those issues included the payment Britain must make to the bloc upon departure for its non-fulfillment of obligations, keeping the border between EU member Ireland and Northern Ireland open and protecting the rights of EU citizens living in Britain and vice versa. Britain is planning to leave the EU in March 2019. European Commission President Jean-Claude Juncker said on Friday that real negotiations on the second phase of Brexit talks would start in March 2018. Continued division over migration The EU summit in Brussels, which ends on Friday, has also seen the east-west divide over migration to the bloc continue, with eastern states remaining firm in their stance against refugee redistribution quotas that have been agreed to by a majority of member nations. The quotas are seen as a measure of assistance to countries such as Greece and Italy, which have seen most of the migrants come to their shores over the Mediterranean. The EU is seeking to reform its policy on asylum before an expected renewed influx of migrants and refugees in summer next year when weather improves to allow safer voyages across the Mediterranean from Africa. Strengthening external borders However, the four eastern European countries making up the so-called Visegrad group — the Czech Republic, Hungary, Poland and Slovakia — were fully behind an EU project aimed at enhancing border protection in Libya, which has now become the main launchpad for migrants and refugees wanting to come to Europe. They offered €35 million ($41 million) to assist the Italian-led project in a move meant to demonstrate that they are actively working on solutions to the migration issue. Hungarian Prime Minister Viktor Orban said that the EU's policy of defending its outer borders was the one that had "worked and operated well on the ground, delivered the result we have expected." The summit has also approved an extension to economic sanctions imposed on Russia over its role in the conflict in eastern Ukraine, as well as the establishment of a joint European defense force.

The EU has given the formal green light for a second phase of negotiations on Britain’s departure from the bloc. The talks will now focus on a transition period and the future trading relationship between the two sides. EU leaders meeting in Brussels said on Friday that the way was clear for the opening of the second phase of Brexit ... Read More »

Ireland border dispute blocks Brexit deal, threatening a political crisis

In the wake of a collapsed deal, Britain's chief negotiator said there will be no special status for Northern Ireland. A "hard border" dividing the island of Ireland would have a profound political and economic impact. David Davis, Britain's chief Brexit negotiator, on Tuesday said Northern Ireland will not receive special treatment within the UK in the wake of the country's formal divorce with the EU. A deal on the border between the Republic of Ireland, an EU member state, and Northern Ireland, which forms part of the UK, collapsed at the last minute on Monday when the Democratic Unionist Party (DUP) announced it would not accept the accord. Read more: Northern Ireland's fragile peace 'all about the border' According to a draft text, the UK would have ensured "continued regulatory alignment" between Northern Ireland and its EU neighbor, Ireland. 'Regulatory divergence' But DUP leader Arelene Foster said the party, which keeps May's government in power, "will not accept any form of regulatory divergence which separates Northern Ireland economically or politically" from the UK. "That is emphatically not something the United Kingdom government is considering," Davis told parliament after May met with DUP colleagues on Tuesday. "We will not be treating one part of the United Kingdom differently from any other part." The DUP's lack of support for the deal caught May's government off guard minutes before it was expected to be announced. However, May remained optimistic, telling reporters on Monday that a deal could be hashed out before a mid-December EU summit, where European leaders will decide whether to advance talks on post-Brexit trade. Why is the Irish border an issue? Thousands of Irish and British citizens in the Republic of Ireland and Northern Ireland cross the border every day for work. Irish government figures show that more than 100,000 British citizens live in the EU member state. Ireland exported €15.6 billion ($18.44 billion) of goods to the UK, while imports of goods from the country amounted to €18 billion, approximately a quarter of all imports to the EU member state. A "hard border" could threaten the Good Friday Agreement that calmed decades of sectarian violence on the island of Ireland. The DUP was the only major political party in Northern Ireland to oppose the agreement, which has ensured peace since it went into effect in 1999. The UK and EU are attempting to hash out an agreement that will prevent a "hard border" from being implemented in the wake of Brexit, which would have a profound political, economic and financial impact on both sides. 'Keep the UK in the single market' Meanwhile, political parties across the UK have called for May's government to offer a different approach to Brexit, one that would ensure equal status across the kingdom. "This could be the moment for opposition and Brexit/remain Tories to force a different, less damaging approach – keep the UK in the single market and customs union," said Nicola Sturgeon, who leads Scotland's devolved government, in a tweet. Read more: Brexit poll: Half of Britons support second referendum "But it needs Labour to get its act together. How about it Jeremy Corbyn?" she added, referring to the leader of Britain's main opposition party. Keir Starmer, the Labour party's Brexit spokesman, told parliament on Tuesday that the collapse of a deal was an "embarrassment" and showed that May's government was in a "coalition of chaos." "Yesterday, the rubber hit the road: Fantasy met brutal reality. Will the prime minister now rethink her reckless red lines and put options such as a customs union and single market back on the table for negotiation?" asked Starmer. May has repeatedly insisted that the Brexit means that the UK will no longer be part of the EU single market and customs union when it leaves the block on March 29, 2019.

In the wake of a collapsed deal, Britain’s chief negotiator said there will be no special status for Northern Ireland. A “hard border” dividing the island of Ireland would have a profound political and economic impact. David Davis, Britain’s chief Brexit negotiator, on Tuesday said Northern Ireland will not receive special treatment within the UK in the wake of the ... Read More »

Brexit: EU and UK ‘close to financial agreement’

Reports suggest the UK government has made a significantly improved offer to the EU on the terms of its Brexit financial settlement. There’s talk of "sufficient progress" before a December 4 meeting but doubts remain. The EU and the UK are close to agreement on the final Brexit 'divorce bill' — the share of EU liabilities the UK will pay upon leaving the bloc — according to several reports in the British media reported late on Tuesday. The BBC, the Financial Times, the Guardian and several other British newspapers and media outlets are reporting that following a UK government cabinet meeting last week, the British significantly upped their offer to Brussels, coming much closer than they previously had to the EU's estimate of the UK's financial obligations. According to several EU diplomats and officials, intense negotiations have led to the UK broadly agreeing to the terms of a financial settlement that could see the country paying a net amount of at least €50 billion ($59 billion) over a period of several years after it leaves the EU in March 2019. When asked on Wednesday about the reports, the EU's chief negotiator on Brexit Michel Barnier said: "We are working really, really hard on these subjects. I hope that I can report that we have been able to negotiate a deal." While nothing official has been announced, the reports suggest the two sides are close enough on the issue for the EU to deem "sufficient progress" has been made on it when a crucial meeting takes place between British prime minister Theresa May and European Commission president Jean-Claude Juncker on Monday, December 4. "I think we can reach sufficient progress, but again we haven't seen anything on paper yet, so I am always extremely cautious," said one EU official involved in the talks. Splitting the bill The so-called 'divorce bill' relates to a series of liabilities the UK has in relation to its 44-year membership of the EU. Membership of the bloc means member states are committed to paying a share of various EU liabilities — thought to be around €745 billion — that relate to various costs ranging from the EU budget to pensions and loan repayments. Both the EU and the UK government have declined to comment in any significant detail so far. However, the reports have raised hopes that the UK is edging closer to moving onto the next stage of talks, which will deal with trade and the UK's future relationship with the EU. Theresa May is expected to formally present the change in the British position to the EU next week, although both sides say no final exit settlement figure will be agreed on at this stage. The UK has been pushing for a calculation model which avoids one lump-sum figure, and which instead recalculates the level of liabilities on a year by year basis into the future. Bordering on progress? The news comes at a particularly crucial and sensitive moment in the entire Brexit process. When May and Juncker meet in five days' time, all three of the big issues will be on the table, namely: the 'divorce bill', EU citizens' rights and the border between Ireland and Northern Ireland. If the EU's chief negotiator Michel Barnier deems sufficient progress to have been made on all three issues, the green light may be given to progress the Brexit talks into the next stage, with the final decision on that to be made at a European council meeting of the bloc's leaders on December 14 and 15. While progress has been made on the issue of citizens rights', and with the latest reports suggesting the EU may well be sufficiently satisfied with the "divorce bill" issue for now, that leaves the border issue as the primary stumbling block. With the Irish government very unhappy with the manner in which the British government has approached the border issue to date, there remains the possibility that it may use its veto to stop Barnier deeming "sufficient progress" has been made on it, further stalling the negotiations. As with the specific details on precisely what the UK will offer in terms of a financial settlement, the border issue and everything else ought to become at least a little clearer when May meets Juncker on Monday.

Reports suggest the UK government has made a significantly improved offer to the EU on the terms of its Brexit financial settlement. There’s talk of “sufficient progress” before a December 4 meeting but doubts remain. The EU and the UK are close to agreement on the final Brexit ‘divorce bill’ — the share of EU liabilities the UK will pay ... Read More »

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