Britain”s trade talks with the European Union face the “strong possibility” of ending without agreement, Prime Minister Boris Johnson warned after meeting his ministers on Thursday.
The two sides have given themselves a deadline of Sunday to revive their stalled negotiations for a deal that would come into force at the end of this year.
Johnson said the UK should prepare for an “Australian relationship with the EU than a Canadian relationship with the EU.”
The reference to Australia is Johnson’s preferred phrasing to describe a no-deal exit. Australia does not have a free trade agreement with the EU, whereas Canada does.
The new arrangement would begin on January 1, 2021, when the transition period that followed Britain’s departure from the EU comes to an end.
A no-deal split would bring tariffs and other barriers that would hurt both sides, but many economists think the British economy would take a greater hit because it does almost half of its trade with the the EU.
European leaders meeting in Brussels on Thursday were equally pessimistic about the prospects of an agreement.
“I am a bit more gloomy today, as far as I can hear,” Swedish Prime Minister Stefan Lofven said at a EU summit where European Commission President Ursula von der Leyen briefed the 27 leaders on her unsuccessful dinner with Johnson.