British Prime Minister Theresa May will Thursday make a pitch to European Union leaders on guarantees for EU citizens living in the U.K., hoping to revive stalled Brexit talks by shifting the focus away from a deadlock over money.
But European officials say her words won't be enough to break the impasse. Negotiations are running in circles: Officials from the other 27 European countries want more specifics on how much the U.K. is willing to pay as part of its divorce settlement before talks can progress to Britain's future trade relationship with the EU but London doesn't want to yield on money until it has guarantees on Britain's future trading relationship.
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Slow progress at what was supposed to be a key moment shows how May's political weakness is hampering talks, sowing uncertainty for businesses in the U.K. With less than a year-and-a-half until the U.K. is expected to leave the bloc, any failure to reach a deal is likely to cause enormous disruptions for businesses that rely on unrestricted trade between the U.K. and the EU. Such a scenario could pose big risks to the U.K. and European economies.
Several months into talks, negotiations have been limited to terms of Britain's departure from the EU: How much money it owes the bloc, the treatment of three million EU citizens living in the U.K and the one million Britons living in the EU, and how Brexit will affect the border between Northern Ireland, which is part of the U.K., and Ireland. Mrs. May had hoped to move beyond divorce issues to start negotiating the future trade relationship this month.
She now hopes that her offer on rights for EU citizens will inject new energy into the process during a two-day summit of EU leaders, enabling talks to move to trade and Britain's two-year transitional arrangement out of the bloc. In an open letter to EU nationals, Mrs. May wrote that she wants to make it as easy as possible for EU citizens living in the U.K. to stay and that Brussels and London are in "touching distance" of reaching an agreement on the issue.
"As I travel to Brussels today, I know that many people will be looking to us--the leaders of the 28 nations in the European Union--to demonstrate we are putting people first," she said. "EU citizens who have made their lives in the U.K. have made a huge contribution to our country. And we want them and their families to stay."
A senior U.K. government official said Mrs. May will tell EU leaders over dinner Thursday that she wants them to commit to swift progress on negotiations, including on the issue of the rights of EU citizens, so that talks can move to the next phase. But EU diplomats said a number of issues remained outstanding, including what role the European Court of Justice would play in protecting the rights of EU citizens living in the U.K.
Beyond the issue of EU citizens, the U.K. and the EU are furthest apart on the issue of money, a senior EU diplomat said. "Is it a question of Europe accelerating the talks? No, the ball is still in the British court," the official said.
British officials said Mrs. May won't budge on the issue of money at the summit. After poor election results in June, in which Mrs. May's Conservatives lost their majority in Parliament, Mrs. May has faced additional pressure from euroskeptics within her cabinet and party who want her to take a more hard-line approach.
"We understand the domestic difficulties, but that's not our problem," an EU official said. The official said the EU needed more specifics on how much the U.K. was willing to pay each year as part of its settlement.
The next opportunity for talks to advance is an EU summit planned for December. But Another EU diplomat said ahead of this week's summit that even December may be too early for talks to move on to the next stage. "It's 50-50 in my view," the official said. "But I do get the collective sense of expectation and hope [of] 'Let's now aim at December at the European level.'"
For talks to advance by year-end, Mrs. May must put recent commitments into official negotiating positions, said European Council President Donald Tusk, who represents EU leaders. He said he didn't expect a breakthrough at the summit.
Emre Peker contributed to this article.
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(END) Dow Jones Newswires
October 19, 2017 07:43 ET (11:43 GMT)