Britain and the EU will spend the weekend in intensive talks over a new customs plan for Ireland that could lead to Boris Johnson securing a Brexit deal at this week’s crucial Brussels summit.
Amid growing speculation that a deal may finally be possible, the pound and stock markets rose sharply on Friday after it emerged that the Prime Minister had offered to compromise on his initial Brexit proposal.
Downing Street is understood to have shared details of the proposed compromise privately with EU negotiators, which paved the way for detailed formal talks to begin ahead of next week’s meeting of EU leaders.
On Friday, speculation mounted that the proposed compromise could see Northern Ireland remain politically part of a customs union with the EU but one administered by the British government.
While this would mean a customs border in the Irish Sea, it would also allow Northern Ireland to benefit from trade deals struck by Britain with the rest of the world, and there would be no customs checks on the island of Ireland.
Mr Johnson repeatedly declined to say whether customs union concessions had been offered to Brussels but said: “Under no circumstances will we see anything that damages the ability of the whole of the United Kingdom to take full advantage of Brexit.”
The Prime Minister told reporters that he could see a “pathway to a deal, but that doesn’t mean that it is a done deal”. British and European negotiators will spend the weekend attempting to turn the concept into a legal reality.
Sources suggested that both sides were prepared to walk away if their respective red lines were crossed.
Donald Tusk, the president of the European Council, said he had seen “promising signals” from Ireland following Mr Johnson’s meeting with Leo Varadkar, his Irish counterpart, on Thursday.
After what he said was a two-hour “constructive meeting” over breakfast in Brussels with Stephen Barclay, the Brexit Secretary, Mr Barnier addressed EU-27 ambassadors and was given the go-ahead to “begin tunnel negotiations”, a source inside the room told The Daily Telegraph.
“Tunnel” negotiations refer to intensive talks both sides hold secretly, without briefing ambassadors or MEPs until they are over.
However, Mr Barnier added: “Brexit is like climbing a mountain. You need vigilance, determination and patience.”
Another senior EU diplomat added: “There are elements that will allow the negotiating teams to continue their efforts in search of a positive outcome. We hope that we can find a deal by the time of the EU summit.”
The DUP gave a guarded welcome to the proposed compromise.
Arlene Foster, the DUP leader, issued a warning that any Brexit deal that traps Northern Ireland in EU structures will not get DUP support.
Despite this, a DUP source also indicated it was not necessarily opposed to a post-Brexit customs partnership with the EU and told reporters: “Provided it doesn’t mean that NI is excluded from being able to participate in new trade deals, we could be supportive.”
Mr Johnson will nevertheless face an uphill struggle to secure parliamentary support for a deal and may have to rely on Labour MPs.
Remain-supporting MPs are thought to be planning to try to ambush a parliamentary vote on any deal and insist that the public are offered a so-called confirmatory referendum on the proposal.
This would involve another Brexit extension, of up to six months.
Nigel Farage, the leader of the Brexit Party, warned against making too many concessions on Friday and said: “Let’s hope that this is not a surrender.”
Meanwhile, the Government awarded £86.6 million worth of contracts to ferry companies to transport medicines in the event of a no-deal Brexit.
Brittany Ferries, DFDS, P&O and Stena Line will be able to deliver those supplies from Oct 31, it said.
The four firms will operate on 13 routes from eight UK ports that are less likely to face disruption: Teesport, Hull, Killingholme, Felixstowe, Harwich, Tilbury, Portsmouth and Poole.