British PM Boris Johnson says a moment may come when it's game over on Brexit

Mr Johnson will head to Brussels within days for urgent talks with European Commission President Ursula von der Leyen. PHOTO: EPA-EFE

LONDON (REUTERS, BLOOMBERG) - British Prime Minister Boris Johnson said on Tuesday (Dec 8) that there might come a moment when London would have to acknowledge that it was time to go for a no-deal Brexit and abandon talks.

Asked if he would try to do a deal right up until the wire, Mr Johnson said: "Yeah, of course."

He added, using a cricketing term for the end of play: "We're always hopeful but, you know, there may come a moment when we have to acknowledge that it's time to draw stumps and that's just the way it is.

"We will prosper mightily under any version and if we have to go for an Australian solution then that's fine too."

Mr Johnson will head to Brussels within days for urgent talks with European Commission President Ursula von der Leyen, amid growing fears on both sides that Brexit trade talks will fail.

The two spoke on Monday evening and agreed to meet after they concluded a deal remained far off, despite frantic attempts by their negotiators to break the deadlock as time runs out.

A time and date for the meeting has yet to be decided.

European Union leaders gather for a summit in Brussels on Thursday and Friday.

The face-to-face meeting between Mr Johnson and Ms von der Leyen is a sign that eight months of technical negotiations have gone as far they can and, if there is to be a deal, political leaders will now need to step in and broker a compromise.

Equally, it suggests both sides still think they have time before the ultimate deadline at the end of the year and aim to use it to extract last-minute concessions.

The two teams are still far apart, with significant differences on the three key issues of fisheries, rules for fair competition, and the governance of any deal, they said in a joint statement on Monday evening.

Disagreements on those subjects have dogged the negotiations since they began eight months ago.

The British side gave a bleak view of the state of play, warning the negotiations may be headed for failure.

A senior British official said there had been no tangible progress since the atmosphere soured last week and there is every chance they will not reach an agreement.

The Europeans were also pessimistic, with Irish Foreign Minister Simon Coveney warning of mounting frustration with the British approach.

Mr Coveney said some countries are becoming resigned to the idea of Britain crashing out of the EU single market and customs union with no trade deal in place, and the mood in the bloc is starting to shift toward contingency planning.

Meanwhile, UK businesses fired a broadside at ministers for leaving them no time to adapt to post-Brexit rules, even if negotiators do strike a trade deal.

Executives and lobbyists from industries ranging from aerospace to law decried their situation in written statements to the Business, Energy and Industrial Strategy panel of lawmakers ahead of a Tuesday hearing on Brexit preparedness.

"The uncertainty produced by the current negotiations and the lack of time with which to deal with the outcome before the end of the transition period on 31 December, 2020 is highly damaging to business confidence and their ability to prepare," ADS, the aerospace and defence lobby, said in its submission. "A non-negotiated outcome would be the worst possible situation for businesses."

Aerospace ADS called for the UK and EU to sign an agreement to ensure aircraft parts continue to be certified for safety whether they are made in Britain or mainland Europe. Failure to do so could mean extra costs and complexity as manufacturers figure out an alternative system.

ADS also called for the European Aviation Safety Agency to have no-deal backstop measures in place, like recognising safety certificates issued by the UK's authority for at least nine months. As it stands, parts for production and maintenance would be approved but newly-designed parts would not.

Arla Foods UK, which represents as much as one-third of Britain's dairy farmers, said that in addition to concerns such as potential storage and labour shortages, "we also repeatedly uncover new issues that we have not been aware of before" despite preparing for Brexit since 2016.

The food and drink industry faces a "triple whammy of Covid-19, Christmas demand and Brexit", and consumers are not ready, it said.

On top of potential tariffs in a no-deal scenario or extra red tape with trade even if a deal is reached, Britain could face shortages next month as the country imports 15 per cent of the dairy it consumes, particularly yogurt, butter and cheese.

Despite preparation, law firms face "significant issues, additional costs and a reduced ability to service EU-based clients from January 2021 onwards", the Law Society of England and Wales said. "Conditions they are planning for are likely to change with little warning," it added.

Britain's legal services industry accounts for 552,000 full-time employees and was worth almost 60 billion pounds in 2018, the document added.

Without a free trade agreement, the tobacco industry faces tariffs as high as 70 per cent, which would lead to price shocks and risks a black market, said Japan Tobacco International. "Our business planning is negatively impacted by the lack of clarity and timeliness in much of the information provided by the government as the deadline approaches," it said.

Meanwhile, corner shops are worried about higher wholesale prices, availability of stock, and a lack of clarity over the trading program for the border between Great Britain and Northern Ireland, according to the Association of Convenience Stores, which represents 33,500 local shops.

Most of its members are small and independent operators and, therefore, totally reliant on suppliers and wholesalers taking the right action, the association said.

Separately, small- and medium-sized businesses are unlikely to be ready for post-Brexit accounting regimes, said financial software company Sage Group. It called for a "soft landing" period with forgiveness on faulty filings as businesses adapt to new rules around sales tax and customs, and warned government that Covid-19 exacerbated the potential hit to its customers.

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