Brexit Talks Reveal Dashes of Frustration and a Hint of Progress – Bloomberg

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Brexit negotiators acknowledged frustration on both sidesover the U.Ks divorce from the European Union, due to entrenched early positions. But signs of progress are also emerging.

The second day of the monthly negotiations in Brussels saw officials delve into the details of the main issues they want to make headway on before an October summit of leaders. Several hours weredevoted to how to keep a soft Irish border after Brexit, as well as the rights of European nationals in the U.K.

The past two days show that Britains divorce payment to the EU remains one of the biggest sticking points, people familiar with the talks said. Both sides are barely going further than trying to understand each others positions, quizzing each other as they seek to tease out common ground, according to people familiar with the discussions speaking on condition of anonymity.

With Theresa Mays government embroiled in infighting in London, nearly 100 civil servants are in the Belgian capital working to reach a deal by the end of next year with time on the side of the bloc. The risk for the U.K. is crashing out of the union in 2019 with tariffs awaiting and businesses fleeing.

Accused by EU negotiator Michel Barnier of wasting time, the U.K. has sought to regain some of the initiative this week by spelling out its stance on key issues.

British officials believe the government took a significant step last week when it acknowledged in writing for the first time that it owed the EU money. Analysts have said the amount, based on past commitments, could stretch to 100 billion euros ($115 billion). Yet the U.K. is unlikely to agree to a figure until the last minute, according to the people familiar with the discussions.

The EU has said it must be persuaded of sufficient progress in the negotiations on the U.K. payment, citizens rights and the Irish border before it will allow talks to move toward the crucial issue of future trade -- something both sides want to do in October.

If all goes well, the U.K. and EU will sign an agreement by the end of 2018 to allow ratification by the European Parliament, before Britain leaves the bloc the following March.

The U.K. governments latest position is that if it can convince EU negotiators that it has signed up to the principles of a financial settlement and that Britain wont go back on its word, that will be enough, according to the people familiar with the discussions.

But as the U.K. seeks to maintain leverage as long as possible, it wont make any legally binding commitment until an overarching Brexit agreement is signed, the people said.

Talks in Brussels are scheduled to last until Thursday, when U.K. negotiators will return to London, leaving the European Commission to brief officials from the 27 countries on progress. A third round of negotiations is planned for the final week of August.

Earlier in the day, European Commission spokesman Margaritis Schinas denied that it was a problem that Brexit Secretary David Davis only stayed a few hours on Monday before leaving the talks. We are not concerned about it, chief negotiators do not have to be present all the time, he told reporters in Brussels.

And on the U.K. having a team twice as large as that of the EU? His response: We dont feel that we have been invaded.

Although the negotiators are focused on the task at hand, both sides are making efforts to get along. On Tuesday, many of them spent their lunch hour together eating salad served in the European Commission. An issue over a lack of coffee for the two teams on Monday was rectified 24 hours later -- with the help of some chocolate biscuits.

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Brexit Talks Reveal Dashes of Frustration and a Hint of Progress - Bloomberg