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EU warns Britain about the price of Brexit

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Via Financial Times

EU leaders on Friday warned Britain that life outside the bloc will never match the benefits it enjoyed as a member, as they vowed to launch a “new era” for the union after Brexit.

In a determined show of unity hours before the UK’s formal departure from the EU, European Commission president Ursula von der Leyen and the heads of the bloc’s other major institutions said it was now for Britain to decide how close a relationship it wanted with the union.

“We have a lot in common and it’s worth proving to the world we can be neighbours and work closely together,” said Ms von der Leyen. “We want to have the best possible relationship with the UK but it will never be as good as membership.”

Charles Michel, the European Council president, reiterated previous warnings from Brussels that the depth of future economic relations would depend on Britain’s willingness to stick closely to the bloc’s rules.

“The more the UK will diverge from EU standards, the less the access to the single market,” he said.

German chancellor Angela Merkel reinforced the message, saying: “The more the UK will diverge from the conditions of the single market, the bigger the differences in our future relationship will be.”

In a nationwide broadcast from the Elysée Palace, French president Emmanuel Macron said Brexit was an alarm call for Europe underlining the need for EU reform.

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“This departure is a shock,” he said. “It’s a historic alarm signal that should echo in each of our countries, be understood across Europe and make us think — because for the first time in 70 years, a country is leaving the European Union.”

Mr Macron added that the 27 EU states would be united in negotiating the future relationship with the UK, and while the aim was to have the closest possible partnership, the British people had chosen to leave the union.

“You cannot be both inside and outside,” he said. “The UK will no longer have the same duties, and will therefore no longer have the same rights.”

Prime minister Boris Johnson, who next week is expected to set out his thinking on a UK-EU trade deal in a keynote speech, has previously indicated he wants Britain to diverge from the bloc’s rules after Brexit.

In a joint press conference, Ms von der Leyen, Mr Michel and European Parliament president David Sassoli vowed to move on boldly from more than two years of tense divorce negotiations with the UK and deliver a more “confident” EU.

They said fighting climate change and claiming a greater role for Europe in the digital economy were particular priorities.

“As the sun rises tomorrow, a new chapter for our union of 27 will start,” said Ms von der Leyen.

“Tomorrow, almost half a century of UK membership is over. When the UK joined, I was still at school. During these 47 years our union has gained impetus and become a global powerhouse.”

She praised the UK’s contribution to the EU as “pragmatic” and “down to earth”, but also warned Britain that “strength does not lie in splendid isolation but our unique union”.

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Ms Merkel described Brexit as a “deep cut for us all”, adding that Germany would like to remain a “close partner and friend of Great Britain”.

Brussels is preparing to kick-start a new phase of negotiations with the UK as the two sides try to hammer out the terms of their future partnership before the scheduled end of Britain’s post-Brexit transition period in December.

The EU’s chief negotiator Michel Barnier will present the union’s draft mandate for the trade negotiations on Monday.

Irish prime minister Leo Varadkar said in a speech on Friday that it would be difficult to strike an EU-UK trade deal this year, although insisted it could be done, “particularly if the new trade deal is very similar to the current arrangements”.

He called for Britain to maintain alignment with EU rules to secure market access at the end of the transition period, and warned that failure in the trade talks would present an “existential threat” to Ireland’s economy.

The UK will cease to be a formal member of the EU at 11pm UK time, stripping its diplomats of access to the bloc’s institutions and information flows and consigning it to the status of a “third country” in Brussels jargon.

Mr Michel, a former Belgian prime minister, said he had “mixed feelings” about an “exceptional day” in the EU’s history.

“We are opening a new chapter and we will devote all our energy to building a stronger and more ambitious EU.”

The bloc’s first big challenge after Brexit will come as early as next month. Mr Michel has convened a summit of leaders of the 27 EU member states to break an impasse over how to fund the bloc’s next seven-year budget.

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Brexit makes that negotiation even more difficult, because Britain was one of the largest net contributors to the budget.

Mr Michel dismissed concerns that the rare unity shown by EU governments during the Brexit talks would be blown apart by fractious negotiations over money.

“There is a great determination among the heads of states to tackle the issues we face,” he said. “We need to look at the resources we apply to all our challenges.”

Additional reporting by Arthur Beesley in Dublin

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