The EU is unlikely to agree to British proposals to stay in the single market for goods, senior sources say, but may be willing to talk about access to the single market for agricultural goods only when Brexit talks recommence in Brussels later this month.
Such a move is likely to be welcomed by the Irish Government as it could overcome many of the potential difficulties at the Border after the UK leaves the EU. However, it would require the EU to move on some of its red-line issues, which it has not been willing to do until now.
On Thursday, EU chief negotiator Michel Barnier signalled a willingness to "improve the text" of the backstop with the UK, echoing a declaration by the Taoiseach earlier this week of flexibility on the issue.
In an op-ed piece carried in several European newspapers, Mr Barnier said the EU was “ready to improve the text of our proposal with the UK”. It is expected that a new text for the backstop – which guarantees no hard border even if the UK leaves the EU without agreement on a future trading relationship – will be tabled when the talks resume in Brussels in mid-August.
No deal
The UK has rejected the EU’s suggested text which kept Northern Ireland in the single market and customs union in the event of no deal, while the EU ruled out suggestions by the British government that all of the UK could remain in the customs union for a temporary period.
An Irish Government source said the process to revise the backstop was “nowhere near drafting”, but stressed Dublin’s willingness to amend the existing wording as long as it achieves the Irish imperative of guaranteeing no hard border.
“They can call it the silly little Irish backstop that will never be used if they want,” said a Government source in Dublin. “That’s fine. As long as it does what it needs to do.”
The Irish backstop is the last substantial part of the withdrawal agreement between the EU and the UK that has not yet been agreed. The agreement is due to be concluded by the October EU summit, but many of those involved expect the deadline to slip to November or December.
Transition period
All EU countries must ratify the treaty before it takes effect when the UK leaves next March. A key part of the withdrawal treaty is the transition period which enables the UK to remain under EU law and structures for a further two years, allowing the British government to prepare for leaving.
The UK will also continue contributions to the EU budget during that period, averting a budget crunch for the EU. However, if there is no agreement on the backstop, the withdrawal treaty cannot be concluded. Without it, the UK would leave the EU abruptly next March, causing enormous disruption for both the UK and EU countries.
