FLORENCE • British Prime Minister Theresa May called yesterday for Britain to stay in the European Union's single market during a roughly two-year transition out of the EU, while offering concessions on a divorce deal as she appealed for a revival of Brexit negotiations.

Mrs May spent much of the speech in a 14th century church in Florence drawing on the similar values of Britain and the rest of the EU. She said if the complicated talks to unravel more than 40 years of union should fail, the only beneficiaries would be those who oppose democracy, liberalism and free trade.

But her concessions on her vision for a two-year transition period on Britain's current membership terms, final financial settlement and legal protection of EU citizens' rights when Britain leaves in March 2019 may still fall short of what the EU said was needed to move the negotiations forward.

The pound weakened about half a penny against the euro and three-quarters of a cent against the dollar during her speech, underlining the sensitivity of the talks to markets and firms, some of which fear Britain could crash out of the bloc without a deal.

"For while the UK's departure from the EU is inevitably a difficult process, it is in all of our interests for our negotiations to succeed," she told an audience of Italian business leaders and diplomats.

"If we were to fail, or be divided, the only beneficiaries would be those who reject our values and oppose our interests."

In Florence, Mrs May drew on the history of an Italian city made wealthy by trade and banking during the Renaissance to underline her desire for Britain to become a major European trading power after leaving the bloc.

Her words were aimed at unlocking the first phase of negotiations with the EU, all but stalled over one of the most symbolically important questions: How much will it cost Britain, in hard cash, to end its EU membership in March 2019?

Mrs May has repeatedly said that Britain would honour its obligations but has also been under pressure from pro-Brexit supporters in her Conservative party to reduce the bill or even bring it down to zero.

Britain desperately wants to move the talks forward and start addressing how a future relationship with the EU would work, a move Mrs May's government says is vital if they want to find agreement on the divorce settlement.

But the EU has stood firm, refusing to discuss trading arrangements until "sufficient progress" had been made on the first three issues - the financial settlement, the border with EU member Ireland and the protection of expatriates' rights.

REUTERS