'Ireland first' - EU's Tusk fires Brexit warning shot

Responding to Mr Hammond's assertion that it was in the interest of both Britain and European Union to ensure that UK-based financial services companies had easy access to the single market, Mr Tusk said: "I fully respect the chancellor's competence in defining what is in the UK's interest". He said it would be the first time in history that a free trade agreement would "loosen, not strengthen, economic ties".

"I propose our goal to be a trade agreement covering all sectors and duty-free on goods", said also he, adding that it should include services and reciprocal access to fishing areas.

Brexit negotiations have reached a critical stage, yet essential issues over citizens' rights remain unresolved and solutions maintaining an invisible border on the island of Ireland are not forthcoming.

The French seem to be trying to make the situation as complicated as possible in a thinly veiled ploy to make Paris the centre of European financial Services.

The draft guidelines published yesterday made no explicit mention of Gibraltar but referred to earlier negotiating positions that included the controversial Spanish veto, adding that these still applied.

"Financial services can not be in a free trade agreement ... we have to rely on equivalence regimes, that is the best solution for financial services", le Maire told BBC radio, citing the need for stability and supervision in the sector.

In a joint statement airport associations ACI Europe and the AOA welcomed the comments "This charts the way forward for the future aviation relationship and thus potentially reduces uncertainty for our sector", it says.

Meanwhile the Taoiseach called for "certainty" from London regarding how it plans to protect the border and how it sees its future relationship with Brussels.

Mr Hammond's speech comes as Brussels seeks to set out its position for the next phase of Brexit talks.

The chapter on financial services says the European Union and Canada must treat each other's sectors equally, but a "prudential carve-out" allows each side to protect consumers and financial services providers while maintaining financial stability.

A senior adviser to EU Brexit negotiator Michel Barnier gave an even more pessimistic assessment to audience at the London School of Economics on Monday night, warning that since the global crash of 2008, the EU had increasingly moved away from a system of "mutual recognition".

Tusk's draft red lines, which must now be adopted by the remaining 27 member states, said the EU was bound by Britain's self-imposed conditions for leaving the European Union. The document circulated by the European Council is giving out a stance that aims to force the United Kingdom from giving up on leaving the customs union and the single market altogether, although the paper officially states that flexibility is on the table. "Always, when we negotiate with third countries, the aim is to improve market access and regulatory environment, and this time it's the other way round".

Former UKIP leader and MEP Nigel Farage immediately responded, blasting: "Unless we take back full ownership and control of our waters, Brexit will have been betrayed".

  • Leroy Wright