United Kingdom and European Union 'at an impasse' in Brexit negotiations, says Theresa May

RED BOX | MATT CHORLEYSeptember 21 2018 9:00am The Times Ruth Davidson’s advice to Tory colleagues Shut up for a bit Matt Chorley Red Box Editor

"The U.K. expects the same". She believes that the process is heading towards Britain leaving with no deal or leaving and moving into a transition phase without a detailed agreement for the country's relationship with Europe. Sterling fell by as much as 1.5 per cent against the USA dollar on Friday, its biggest daily drop this year. The currency was trading down a sharp 1.5 per cent on the day at $1.3066.

Theresa May faces a tough dilemma with European Union leaders showing little desire to compromise and her ability to make further concessions severely restricted by a wafer-thin parliamentary majority and a rebellious caucus of Brexiteers in her party who could topple her government.

Mrs May is going into a politically perilous period as her Conservatives prepare for their annual conference at the end of this month. "Your Brexit's broken", the Daily Mirror newspaper said.

Popular tabloid The Sun even mocked up pictures of Tusk and French President Emmanuel Macron as "Euro mobsters" under the headline "EU Dirty Rats". That is a reference to what European leaders cast as British attempts to cherry-pick elements of EU membership.

May's proposals - dubbed the Chequers Plan after the Prime Ministerial retreat at which they were forged over the summer - which would keep Britain closely aligned to the EU's single market on agriculture and goods (but not services) via a common rule book "will not work" because it risked undermining the single market.

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Jeremy Corbyn said May's negotiating strategy had been a "disaster".

Anti-Brexit campaigner Gina Miller said British officials shouldn't have been surprised.

European Union leaders, who had been expected to offer Mrs May words of support at the summit, instead handed ammunition to Mrs May's critics at home.

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The biggest single obstacle to a deal is the need to maintain an open Irish border.

May said both sides want a deal, but remain far apart on key issues of future trade relations and the Irish border.

The pound saw its biggest drop in nearly a year following Theresa May's crunch statement, in which she admitted Brexit talks had reached an impasse. You are our friends, our neighbours, our colleagues.

He said: "You want that Canada-style free trade agreement".

In response, United Kingdom businesses warned both sides to end their "posturing" and finish the job of getting a deal.

"Don't worry, be happy", joked EU Commission chief Jean-Claude Juncker after telling reporters after a summit in Austria that the Europeans had full plans in place in the event there was no deal before Britain leaves next March.

Labour Party Brexit spokesman Keir Starmer said May was "in denial".

Mr Grayling said: "The PM has set out red lines that this country is not going to stay in the single market, we're not going to stay in the customs union - I agree with her on those, that's the Government's position".

Despite the sombre mood music, May hinted there could be a way forward.

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