The European Union today warned Britain to reach a divorce deal by the end of the month to guarantee moving to trade negotiations, as Brexit talks resumed in Brussels.
Fears are growing in Brussels that the chaotic political situation in London after Prime Minister Theresa May suffered a string of ministerial resignations will hamper the chances of reaching a deal on key issues, especially Britain's contentious exit bill.
EU leaders had hoped to officially approve the next phase on future relations and a transition period at a summit in December, but officials are increasingly concerned that deadline could slip to February or March.
"The European Council summit in October wanted to keep up the dynamic of the negotiations and I am of the same state of mind," Barnier said. "But the real moment of clarification is coming."
This week's talks feature a stripped-down two-day schedule instead of the normal four days, with Barnier and his British counterpart David Davis set to meet only tomorrow morning before holding a press conference, sources said.
To move on to trade talks, the EU is demanding sufficient progress on three key divorce issues, above all the bill Britain must pay to cover its budgetary commitments, a figure which senior European officials put at 60 billion euros (USD 70 billion).
They also want commitments on keeping an open border between Northern Ireland and Ireland, and on guaranteeing the rights of three million European citizens living in Britain.
But the British government looks increasingly distracted, with the resignation of its aid minister over meetings in Israel yesterday adding to the sense of chaos since May's disastrous showing in elections earlier this year.
Britain also faces an economic slowdown, with the EU cutting its growth outlook for the country this year and warning that times would remain tough to 2019 as "uncertainty" over Brexit weighs heavily.
"We are a bit concerned about what we are seeing in the UK at the moment, we want a strong negotiating partner," an EU diplomat told AFP on condition of anonymity.
"I see a strong willingness to come to a deal. I am confident that everybody understands what has to be done on both sides. The question is, Do they have the strength? And will the moves be made in time by the end of November, first week of December?"
That timescale would allow preparations for a formal decision by EU leaders at a summit on December 14-15 to move on to discussing future ties, a step Britain has been pushing for for months.
"Everything is ready (to start trade talks) on the first of January," the EU diplomat said.
Failure to do so would probably push back the move to one of the next summits in February or March, leaving only around six months to reach a deal by October 2018, the timeline Barnier has set in order for the withdrawal agreement to be ratified by Brexit day in March 2019.
The latest round is the first since EU leaders agreed at an October 20 summit to start internal work on a trade deal, while also warning that Britain had made insufficient progress on the divorce to start formal discussions.
The EU says Britain must provide written guarantees of a pledge to honour the financial commitments that May made in a speech in Florence, Italy, in September.
"We don't need speeches, we need commitments," the diplomat said.
European Parliament chief Antonio Tajani -- whose institution will have the final vote on any Brexit deal -- last month set the bill at 50 to 60 billion euros (USD 58-70 billion), and said that the 20 billion proposed by London was "peanuts".
The parliament also rejected fresh proposals by Britain this week on protecting the rights of the three million EU nationals living in Britain after Brexit.
"We don't recognise reports suggesting that a deal on citizens' rights is almost finalised. There are still major issues that have to be resolved," said the parliament's Brexit steering group, chaired by former Belgian premier Guy Verhofstadt.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)