PHILIP Hammond has warned Brussels that it must move beyond threats that Britain will be punished for Brexit as he said it “takes two to tango” to get a deal.
In a speech in Berlin, the Chancellor noted how there had been relative silence from the European Union about how it wanted to trade after the UK left the bloc.
Mr Hammond and Brexit Secretary David Davis are on a charm offensive targeted at German business leaders to build support for a post-Brexit trade deal with the EU which would be the "most ambitious in the world".
The two senior ministers are visiting the EU's major economy after Brussels' chief Brexit negotiator Michel Barnier urged European companies with commercial links to the UK to start preparing for increased "friction" in trade.
Their visit comes amid reports of German opposition to Theresa May's plans for the post-Brexit relationship between the 27 EU members and the UK.
The UK Government wants a bespoke trade deal covering both goods and services after Brexit with Britain leaving the single market and customs union.
At the Die Welt economic summit dinner, Mr Hammond said: "They say: 'It takes two to tango'. Both sides need to be clear about what they want from a future relationship.
"I know the repeated complaint from Brussels has been that the UK 'hasn't made up its mind what type of relationship it wants' but in London many feel that we have little, if any, signal of what future relationship the EU27 would like to have with a post-Brexit Britain.”
The Chancellor explained that since the 2016 referendum there had been a marked asymmetry between the enthusiasm expressed by certain third countries to pursue future trade deals with the UK and the relative silence, in public at least, from Europe on what the EU wanted the future relationship to look like.
Mr Hammond said: "I am saying this to you…because I fear that many EU opinion-formers see this as a question only for British politicians, for British voters to resolve, before they engage with the EU27.
"By signalling a willingness to work together in a spirit of pragmatic co-operation on a future, mutually beneficial, partnership based on high levels of access for goods and services, continued close co-operation in security and defence, in education, science, technology and culture, putting behind us any narrative of 'punishment' for leaving and focusing on the mutually beneficial relationships we have now and can continue in the future, the EU will send a message to the British people which will resonate as they consider the options for their future," he added.
Meanwhile, the public spending watchdog, the National Audit Office, has announced it will examine the estimated £39 billion Brexit divorce bill.
The NAO confirmed it would scrutinise the financial settlement with Brussels after Nicky Morgan, who chairs the Commons Treasury Committee, asked it to consider the "reasonableness of this payment" and assess how the figure was arrived at.
Sir Amyas Morse, who chairs the watchdog, said it had already begun discussions with the Treasury and intended to report in March.
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