Xavier Bettel, Luxembourg’s prime minister, stands beside the empty podium of U.K. Prime Minister Boris Johnson following their Brexit meeting in Luxembourg, on Monday, Sept. 16, 2019. Johnson held his first face-to-face talks with European Commission President Jean-Claude Juncker over a working lunch of snails, salmon and cheese in Luxembourg.

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British Prime Minister Boris Johnson faced a barrage of protesters’ boos, and an exasperated message from his host, after an hour of talks with his Luxembourg counterpart in the normally quiet cobbled streets of this small European nation.

Johnson had hustled into a meeting with Xavier Bettel, the Luxembourg premier, following a nearby lunch with the European Commission’s outgoing president, Jean-Claude Juncker. On the menu at both occasions: Brexit, and the current UK government’s efforts to change elements of an existing withdrawal deal that its predecessor had agreed to almost a year ago.

The British leader subsequently left the prime minister’s residence Maison de Bourgogne in the centre of this small city-state in a hurry, ducking out of a press conference alongside his opposite number, Bettel. Moments later the latter did not hesitate to, as he put it, “mince his words.”

“It was important,” said Bettel, standing beside Johnson’s assigned but empty podium at a press conference prefaced by loud protests, to listen to British proposals “to avoid a no-deal Brexit.” But he insisted that he had seen “no concrete proposals for the moment on the table. And I won’t give an agreement to ideas.”

Away from the loud and rowdy crowd of anti-Johnson hecklers, the prime minister did provide a brief televised statement to the British media before he returned to London, and insisted both sides’ negotiators had already completed a lot of work.

Boris Johnson, U.K. prime minister, departs following a Brexit meeting with Luxembourg’s Prime Minister Xavier Bettel in Luxembourg, on Monday, Sept. 16, 2019.

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But he acknowledged the only obvious area of common ground to emerge from his first face-to-face meetings with Juncker and Europe’s chief Brexit negotiator Michel Barnier, was that talks should continue, more extensively and more frequently.

“Papers have been shared, but we are now at the stage where we really have to start accelerating the work,” he said, “and that was the agreement today.”

“I can see the shape of it, everybody can see roughly what could be done, but it will require movement.”

EU waits on UK proposal

Both critics and allies have described Monday’s meetings as political theater, and Johnson once more in Luxembourg reiterated that if a fresh agreement cannot be reached by late October, then his government would ensure the UK can exit the EU “on the 31st of October, deal or no deal.”

The encounter with Juncker was scheduled exactly one week after the Parliament in Westminster passed into law a measure designed to block the possibility of an abrupt and economically disruptive departure on October 31.

And after their lunchtime sit-down at a local restaurant, Juncker and Johnson emerged to boos from protesters and were forced to negotiate a scrum of reporters and photographers.

Within minutes, the European Commission issued a press release which said the head of the EU’s executive branch had reminded the UK prime minister that it was now up to the British government to “come forward with legally operational solutions that are compatible with the Withdrawal Agreement.”

“President Juncker underlined the Commission’s continued willingness and openness to examine whether such proposals meet the objectives of the backstop. Such proposals have not yet been made,” it added, in a point soon echoed by Bettel.

Sterling weakened sharply to $1.24 after Johnson failed to appear at the press conference, after having trended downwards during much of the day’s trading.

The currency had enjoyed a strong rally against the U.S. dollar last week, since the passage of parliamentary legislation last Monday that was designed to rule out a no-deal exit in October.

Political allies of the prime minister continued to indicate over the weekend that Johnson may try to circumvent that new legislation, and might defy a parliamentary majority that wants him to request a Brexit deadline extension if he is unable to win significant concessions from Brussels in the coming weeks.

As a consequence the ostensible reason for Monday’s working lunch with Juncker had prompted some skepticism.

“He clocks up the miles/meetings and can argue he tried,” said Robert Hayward, a legislator belonging to Johnson’s Conservative Party, of the Luxembourg trip. In a message to CNBC, Hayward said that the Luxembourg trip will allow the prime minister to later argue, “it’s not his fault” if a new deal is not reached.

Anand Menon, a director at the think tank The U.K. in a Changing Europe, also posited it was about “giving the impression of having tried once he’s failed,” as Johnson seeks to change key clauses in the existing Withdrawal Agreement that three times failed to win parliamentary approval back in London.

Solving the backstop

The chief obstacle remains the complex question of how goods and services will be traded between the British nation of Northern Ireland and the separate Republic of Ireland. The border between the two countries could soon become the U.K.’s only post-Brexit land frontier with Europe, but one that must remain open under the terms of a 1998 peace deal signed by the British and Irish governments and known as the Good Friday Agreement.

Since then, Johnson and some of his senior government ministers have begun to outline how they hoped to solve the nine-month negotiating deadlock between the U.K. and the EU, by suggesting that European regulations might apply differently in Northern Ireland and the rest of the U.K.

This was an option that Theresa May repeatedly and categorically rejected last year, during a period when her government held on to its parliamentary majority thanks to support from a small political party in Northern Ireland (the Democratic Unionist Party or DUP) that remains adamantly opposed to any new divergence between the territory and the rest of the U.K.

The U.K.’s Brexit Secretary Stephen Barclay addressed the matter in an interview with Sky News over the weekend, when he said it was important that the U.K. “leave as a whole,” but mentioned there was already in place the potential for some divergence between Northern Ireland and the rest of the U.K. “We can get into those details as part of the talks,” he added.

The DUP no longer provides the Conservative-led government with that key parliamentary majority, after Conservative lawmakers defected or were stripped of their party affiliation for opposing the government’s position during recent legislative tussles.

Bim Afolami, a loyal Conservative lawmaker in Westminster’s lower chamber, the House of Commons, acknowledged ahead of the meetings that the prime minister might not be hoping to achieve a “huge amount” in Luxembourg. He instead echoed a common view that Johnson and his cabinet are “betting the house on getting something sorted at the European Council” in mid-October.

The Conservative Party Chairman James Cleverly, writing in the British newspaper The Sun, acknowledged it as a “crucial EU summit” where Johnson would “strive to get an agreement in the national interest.”

The almost bi-monthly council summits in Brussels have often served as political pressure-cookers, with late-night, caffeine-fueled deal-making between EU leaders on issues including the European debt crisis, Greece’s bailout or Brexit deadline extensions.

Barclay joined his boss in Luxembourg, as did his opposite number at the European Commission, Barnier, who told members of the European Parliament last week that his team had not yet received any backstop alternatives “in writing that are legally operational.”

He had told a group of senior lawmakers he was unable to say “objectively” if talks with Johnson’s government had so far indicated whether or not a new agreement might be reached before the October summit. But he nonetheless played down the possibility last week: “We don’t have any reasons to be optimistic.”

Bettel: ‘This is a nightmare’

And Bettel, the Luxembourg prime minister, said Monday he was not prepared to offer a further Brexit delay unless “it serves a purpose.”

And in response to a question about the possible extension of a separate transition period after Brexit, during which the UK’s trading relationship with the EU would remain unchanged while both sides continue negotiations over the future status of the Irish border, Bettel was blunt.

“This is a nightmare,” he told CNBC. “We should stop to think whether people would like to have a longer period of transition. People would love to have clarity, what is going to happen in London and what is going to happen in the EU, and what will be their position.”

 – CNBC’s Julianne Funk contributed to this report.

Source: CNBC

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