EU chief negotiator still sees hope to clinch EU-UK deal

European Union chief negotiator Michel Barnier said Monday he still has the firm belief that a Brexit trade agreement is possible, and whittled the outstanding disputes to be settled ahead of the New Year to just two.

Barnier said that the nine-month negotiations had come down to finding settlements on fair-competition rules and fishing rights, no longer mentioning the issue of legal mechanisms for resolving future disputes that also long dogged the negotiations.

“Two conditions are not met yet,” he said as he entered a meeting to brief the 27 EU nations on progress in the talks. He is expected to continue negotiations with his U.K. counterpart David Frost later on Monday. “This deal, it is still possible,” he added.

Both sides are teetering on the brink of a no-deal Brexit departure, but have committed to a final push ahead of Jan. 1, when a transitional period following Britain’s Jan. 31 departure from the bloc is to end.

On Sunday, British Prime Minister Boris Johnson and EU Commission President Ursula von der Leyen ditched a self-imposed deadline and promised to “go the extra mile” to clinch a post-Brexit trade agreement that would avert New Year’s chaos and costs for cross-border commerce.

Barnier is willing to accept British trade with no tariffs or quotas, but only if the U.K respects the rules and regulations that have made the EU’s single market of almost 500 million consumers so successful. “Free and fair competition, fair and free, equitable and open, the two go together,” Barnier said.

Johnson, however, says he does not want British business to be hemmed in by EU restrictions, especially if those restrictions would have to be progressively adapted to mainland standards in the future.

On fisheries, Barnier demanded “an agreement that guarantees a reciprocal, I insist, reciprocal access to markets and waters.” It highlighted that just as EU fishermen crave to continue working in British waters, the U.K. seafood industry is extremely dependent on exports into the 27-nation bloc.

Johnson has made fisheries and U.K. control over its waters a key demand in the long saga of leaving the EU. It has been four-and-a-half years since Britons voted narrowly to leave the EU and — in the words of the Brexiteers’ slogan — “take back control” of the U.K.’s borders and laws.

Johnson said over the weekend that the “most likely” outcome was that the two sides wouldn’t reach a deal and would trade on World Trade Organization terms, with the tariffs and barriers that would bring.

After Barnier briefed the ambassadors of the EU nations, however, one EU diplomat said that “there might now be a narrow path to an agreement visible — if negotiators can clear the remaining hurdles in the next few days. There has been some progress in the negotiations over the last few days.” The official spoke on condition of anonymity because the talks were still ongoing.

Exporters and importers face customs declarations, goods checks and other obstacles. EU citizens will no longer be able to live and work in Britain without a visa — though that doesn’t apply to the more than 3 million already there — and Britons can no longer automatically work or retire in the EU.

Without a deal, the disruption would be far greater. The U.K. government has acknowledged a chaotic exit is likely to bring gridlock at Britain’s ports, temporary shortages of some goods and price increases for staple foods. Tariffs will be applied to many U.K. goods, including 10% on cars and more than 40% on lamb, hurting the U.K. economy as it struggles to rebound from the impact of the coronavirus pandemic.