Minister Insists Tory Party Is Not Run By 'Extreme Right-Wing Cabal'

Brexit to hit north-east and Midlands hardest, says secret analysis

Britain can not avoid trade barriers with the European Union if it leaves the customs union and the single market after Brexit, the EU's chief negotiator Michel Barnier has warned.

Downing Street says Britain is "categorically" leaving the customs union post-Brexit - a statement viewed alternately as a salve to calm backbenchers over UK-EU ties, or as a red flag for Tory mutineers.

European Union chief negotiator Michel Barnier meets his British opposite number, Brexit Secretary David Davis, in London.

Mr Davis earlier stressed a "time-limited" transition period after 2019 would "lead to us being outside the customs union and indeed the single market in the longer term".

Panicos Demetriades: Well I think it's a play on words in some sense because I think they always wanted to be able to strike deals with countries from outside the European Union, that was very clear.

May had said she's open-minded on a customs union, but late Sunday a government official briefed reporters that she had ruled out staying in the EU's current customs union, and that it's not "government policy" to stay in "a" customs union either.

Being in a customs union restricts Britain from conducting trade deals with other countries as it would have to apply EU tariffs on any country that doesn't already have an EU trade deal in place.

As her ruling Conservatives bicker over Britain's future trading relationship with the EU, and whether it should stay in the Customs Union, Monsieur Barnier had this warning.

Local political parties were also split on the matter, with the DUP's Sammy Wilson saying he welcomed the "clarification" from the Prime Minister.

Speaking at a City of London dinner on Monday, Bailey said: "There is a range of operational issues arising from Brexit which, if not tackled, will create financial stability risks and issues for both the United Kingdom and the European Union".

Michel Barnier: talking tough on Brexit.

Mr Davis said it was "perfectly clear" what the Government wanted.

"Her MPs will back her, because we are overwhelmingly at one with the majority of the British people who now want a clean Brexit and an end to the present uncertainty".

The UK government has confirmed that Britain will definitely be leaving the EU customs union after a week of conflict within the Conservative party.

The talks would primarily deal with the nature of the transition period, but might touch on the future UK/EU relationship, he said. Should it forgo the customs union or take the middle path.

Many eurosceptic MPs were angered when finance minister Philip Hammond, who has warned of the impact of Brexit on jobs and growth, last month suggested the British and European Union economies would move only "very modestly, apart".

Her answer: "That is such a hard question on so many different levels, I'm going to pass".

"My feeling is we have not a minute to lose because we want to achieve a deal", he told reporters.

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