The UK government are “close to giving up hope” of striking a Brexit trade deal with the EU as talks have stalled over fishing rights and the European Court of Justice.
According to The Daily Telegraph it is believed Ministers are now working to trade with Europe on World Trade Organisation (WTO) terms, after the transition period ends on 31 December.
The UK’s chief negotiator David Frost and the EU’s chief negotiator Michel Barnier are not backing down on fishing rights on the so-called level playing field.
Senior Whitehall sources told the newspaper there is an assumption that no deal will be struck, but a “basic” agreement may happen if Brussels yields ground in the autumn.
German Chancellor Angela Merkel has called on Brussels to prepare for a no-deal Brexit trade deal, and business have also been advised to prepare as “very limited” progress has been made.
A senior source told The Daily Telegraph, “The government has been making it clear for a while now that it is prepared for no deal. Britain isn’t going to budge on fundamentals like fishing rights, so it’s all in the hands of the EU.”
A diplomat told the newspaper, “They are right to work on the basis of no deal [as] we are as well.”
A source from the UK negotiating team said, “We wanted to see an agreement this month. It’s clear from the EU side that’s not going to happen.
“No trade deal has to be the working assumption, because that’s what we have to prepare for. But it doesn’t mean it’s what we want or are working to make happen.”
Another source revealed, “There is a chance of a deal, but it will be a basic deal, not a phenomenal deal. We should know by mid-August whether there’s any chance it will happen.
“It all depends on whether the EU wants to step up negotiations over the summer. If it doesn’t, then the Government’s view is that it’s not interested.”
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