Brexit minister says UK may pay for single market access
The UK would consider making contributions to the European Union in order to secure the best possible access for trade in the single market, Brexit Secretary David Davis has said.
Davis said his priority is to ensure that businesses keep the ability to trade and provide services in the European market after the UK leaves the EU
Although he did not directly mention making payments, Davis's comment signalled that the UK could continue to pay into the EU budget after leaving the bloc in order to maintain access to the single market.
In response to a question about the UK's willingness to make contributions to the EU to retain access, he told MPs it would be taken into account.
"The simple answer we have given to this before is, and it's very important - because there is a distinction between picking off an individual policy and setting out a major criteria -and the major criteria here is that we get the best possible access for goods and services to the European market.
"If that is included in what you are talking about then of course we would consider it," he said.
The pound strengthened after his comments, which will be welcomed by banks and other businesses keen to maintain as much access as possible to the single market.
Wayne David, from the opposition Labour Party, asked Davis: "Will the government consider making any contribution in any shape or form for access to the single market?" Davis replied that his aim is to ensure that British lawmakers, rather than politicians in the EU, have the final say over how UK taxpayers' money is spent.
Tariff-free access to the EU is "essential" to food producers and retailers, chief executive officers, including those from Wm Morrison Supermarkets, Dairy Crest Group and J Sainsbury, wrote in a letter to 'The Times' which was published yesterday.
The Society of Motor Manufacturers and Traders also said this week that losing duty-free ties with the EU could lift the price of imported cars by as much as £1,500(€1780).
Separately, Dutch Finance Minister Jeroen Dijsselbloem, who chairs the group of euro-area finance ministers, also opened the door to the British retaining ties with the single market - although he warned it would come at a cost.
"Of course, we can design new agreements to allow them to enter the internal market and to allow trade to continue," he said in interview with the Times of Malta.
"We have to do that. But it will not be as easy or as cheap as it is now."
Derek Halpenny, European head of global markets research at Bank of Tokyo-Mitsubishi UFJ, said Dijsselbloem's comments marked "the first time we can recall a senior EU official acknowledge the possibility of the UK having access to the internal market" after Brexit.
The insights into how governments are viewing post-Brexit trade came in a week in which both sides of the looming divorce negotiations began fleshing out their plans.
European and UK officials now seem to accept they will have just 15 months to seal a deal once Prime Minister Theresa May triggers the talks, given the need for the European Parliament to ultimately have a say.
Where they still differ is in whether they should discuss issues such as the break and future relationship at the same time as the UK would like, or sequentially which is the EU's preference. (Bloomberg)