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PM seeks progress in Florence

May to offer EU €20 billion transitional deal

Theresa May

Theresa May: a difficult process

Theresa May is expected to offer €20 billion (£18bn) in a divorce settlement with the EU when she speaks in Florence on Friday.

The Prime Minister will propose a transitional deal of up to two years so that no other EU member loses out from the Brexit deal.

A government source said Mrs May wants payments to be conditional on continued access to the single market and a version of the customs union.

She is likely to rule out an alternative arrangement for Britain like the European Economic Area where countries retain a full relationship with the single market but have to accept elements of the freedom of movement.

“The UK’s departure from the EU is inevitably a difficult process, it is in all of our interests for our negotiations to succeed,” Mrs May will say, according to advance extracts of her speech.

“The eyes of the world are on us but if we can be imaginative and creative about the way we establish this new relationship … I believe we can be optimistic about the future we can build for the United Kingdom and for the European Union.”

Britain has expressed frustration at the EU’s demand for progress on the exit bill it must pay – if not an exact amount – before talks can move on, with ministers keen to start negotiating the terms of its new relationship with the bloc.

Brussels has criticised a lack of detail and policy direction from the UK government.

The EU’s chief Brexit negotiator Michel Barnier said that striking a deal with the UK was “in our common interest” but that only a year remained to come to agreement on the key issues – as six months would be needed for ratification before March 2019.

He said he was awaiting “clear commitments” from the UK on the issue of guaranteeing EU citizens’ rights in the UK, on the financial settlement and on the Northern Ireland border. Without those issues being resolved in a withdrawal agreement, there would be no transition deal, he said.

“I am convinced that a rapid agreement on the conditions of the UK’s orderly withdrawal, and a transition period, is possible. For that to happen, we would like the United Kingdom to put on the table, as soon as next week, proposals to overcome the barriers.”

The fourth round of Brexit negotiations begins on 25 September, with the UK due to leave the EU in March 2019.

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