As the clock ticks on the Brexit transition period, due to end on 31 December of this year, talks between the EU and UK have now resumed, though the UK has threatened to walk away from the negotiations unless progress is made by the summer.
German EPP deputy David McAllister said, “With negotiations kicking off today, we are entering into a crucial phase that will set the tone for the future EU-UK relationship.”
“The EU is united; mutual trust and respect should prevail to ensure the best possible outcome for both parties.”
He said the EU “must do its utmost” when negotiating with the UK to “guarantee the European Union’s interests.”
“We take note of the UK’s mandate published on 27 February. Members reiterated in their resolution their determination to establish a future relationship with the UK that is as close as possible, noting nonetheless that this will have to be different from that enjoyed by the UK as a Member State of the EU.”
He went on, “To this end, trust is essential. It is also crucial that the UK government, in the upcoming negotiations, quickly clarifies its approach to the implementation of the Withdrawal Agreement, particularly with regard to the protocol on Ireland and Northern Ireland.”
“With negotiations kicking off today, we are entering into a crucial phase that will set the tone for the future EU-UK relationship” David McAllister MEP
On Thursday the EU’s chief negotiator Michel Barnier warned that following the first round of negotiations between the two 100-strong teams, there were many “serious divergences” between the two sides.
He said, "This is grave, because if the UK’s position does not move it will have an immediate and concrete effect on the level of ambition of our cooperation.”
Meanwhile, the European service industry has called for an “ambitious trade” in services in any future EU-UK trade agreement.
In the Withdrawal Agreement, the EU and UK established the parameters of “an ambitious, broad, deep and flexible” partnership across trade and economic cooperation, with a comprehensive and balanced Free Trade Agreement “at its core.”
Now, the European Services Forum, which represents the service sector at EU level, has written to both the EU and UK, asking them to ensure that any agreement will include “in-depth commitments” on trade in services.
A spokesman for the Brussels-based Forum told this website it is “extremely important” to cover trade in services between the two sides “as mutual trade in services is a significant source of jobs, growth and competitiveness in the EU27 and in the UK.”
Trade in services, it says, will have a central role in any future EU-UK relationship.
“If the UK’s position does not move it will have an immediate and concrete effect on the level of ambition of our cooperation” Michel Barnier, chief EU Brexit negotiator
The importance of the sector is shown by the fact that eleven EU27 countries are among the UK’s top 20 services suppliers, and ten EU27 countries are among the UK’s top 20 export markets for services.
The Forum says these figures “underline the degree of interdependence” between the EU27 and the UK in services business, and the need for an “efficient and open” future relationship between both economies.
It points out that services are the “basis” of both economies, representing 74 percent of EU GDP and 73 percent of the EU labour force and 80.4 percent of UK GDP and 83.5 percent of the UK labour force.
Services constitute a sizable share of the EU27’s overall trade to the UK and vice versa. The EU27 exported €98.6bn in services to the UK in 2018 and the UK exported €131.9bn in services to the EU27, which accounts for 41.4 percent of UK global exports of services.
The Forum spokesman said, “Services trade-related issues are often not seen as decisive in trade negotiations, but in this case and without any doubt, they should be.”
“Any agreement between the EU and the UK must therefore include ambitious commitments in trade in services. An agreement that did not tackle services issues will potentially be hugely detrimental to both economies,” he added.