BERLIN is secretly preparing for an “ambitious and far-reaching” EU free trade deal with Britain after Brexit, a dynamite leaked paper reveals today.
The German foreign ministry has drawn up proposals for a “comprehensive accord” with the UK that fly in the face of Angela Merkel’s tough public stance.
It suggests the Chancellor is acutely aware of the needs of her country’s big businesses, including car makers, despite taking the hardest line of any EU leader on Brexit so far.
Germany is currently blocking a proposal by the bloc’s chief negotiator Michel Barnier to loosen his mandate and allow talks on a transition to begin, much to the chagrin of some member states.
Berlin has also been adamant that Britain must agree to pay up on a Brexit bill of up to £90 billion before it will countenance moving onto trade, a position that has brought the talks to deadlock.
However, behind the public facade it appears German officials are not prepared to drive the talks off a cliff and force Britain into a no-deal exit and the leak may be designed to reassure their fellow EU members of this fact.
The paper may have been influenced in part by the pending entrance of the liberal FDP party, which is free-market orientated and has called for a good Brexit trade deal, into Mrs Merkel’s coalition.
And alongside domestic concerns she could also come under some pressure from fellow leaders at tomorrow’s EU summit to soften her stance on a transition, with some member states now keen to offer Britain an olive branch.
And Mrs Merkel could come under some pressure from fellow leaders at tomorrow’s EU summit to soften her stance on a transition, with some member states now keen to offer Britain an olive branch.
The leak, a day before the EU Council summit and just after Theresa May visited Brussels to dine with Jean-Claude Juncker, came as Hungary broke ranks and said a failure to secure a trade deal with Britain would have “tragic consequences” for the bloc.
And yesterday the Belgian deputy PM pointed the finger at some of his fellow EU member states accusing them of making the negotiations more difficult.
The leaked paper, obtained by Bloomberg, has been circulated across the German government but does not yet form its official policy on Brexit.
It is a four-page document, dated for October 11, which calls for a “comprehensive free-trade accord” between the EU and UK beyond 2019.
According to officials this accord should be “balanced, ambitious and far-reaching” but avoid any chance of the UK “cherry-picking” Single Market access for competitive advantage.
The dossier states: “We share the UK’s desire to secure a close partnership with the Union after its exit that covers economic and trade relations.”
It also proposes a partnership that covers “at a minimum” the fields of foreign and security policy, fighting terrorism, cooperation on criminal justice, agriculture and fisheries, energy, transport, research and digital issues.
Also today the Hungarian prime minister’s spokesman made the clearest break with central EU rhetoric on Brexit yet by calling for trade talks and praising Britain’s offer on citizens’ rights.
Peter Szijjarto said the UK has been generous in its proposals for protecting the rights of EU nationals after Brexit, despite Brussels officially declaring “sufficient progress” has not yet been made on the issue.
He told reporters: "It is in the interests of the whole of the European Union for the strategic relationship with the United Kingdom to continue to exist even after Britain’s exit.
"In view of the fact that the British economy provides one seventh of the EU’s economic performance, failure to conclude a free trade agreement would have tragic consequences for the European economy and also cause major damage to the Hungarian national economy.
"Such a result would mean that one sevenths of the EU’s current economy and the remaining six sevenths would be unable to engage in unhindered trade with each other."