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Pound sinks and FTSE soars as May delivers Florence Brexit speech

23 September 2017

She said that during this time, "access to one another's markets should continue on current terms", though she added the United Kingdom wants to be free during the transition to seek new trade deals.

Britons voted in a referendum on June 23, 2016, to leave the EU. May said the United Kingdom does "not pretend we can have all the benefits without the obligations" but hopes to create a new partnership from scratch rather than negotiate one similar to that of Canada or EEC membership countries including Norway and Switzerland.

She added: "A two-year implementation period on the same terms as now gives our businesses the certainty they need to plan".

Tense discussions have taken place over crucial issues such as the amount Britain must pay to settle its financial commitments to the bloc and the status of European Union citizens in Britain, among others.

The EU's Brexit negotiator, Michel Barnier, said in a statement that May had "expressed a constructive spirit".

After last month's talks, Barnier complained of "no decisive progress" in the negotiations and accused Britain of attempting to secure the "impossible" in its efforts to leave the EU's single market while retaining its benefits. "This transition arrangement she's opted for where effectively we stay members for another two years, I fear that could go on for a long time", Former UKIP leader Nigel Farage said.

But it is not part of the "divorce bill" covering the UK's outstanding debts and liabilities to the European Union, which will still have to be agreed with European Union negotiators, meaning the final bill for Brexit could be far higher.

The speech in Italy was aimed at breaking the deadlock in Brexit talks, due to resume on Monday.

May also said that a new economic relationship should have a "commitment to high standards of regulation", with her government focused on "not only to protecting high standards, but strengthening them". She also said after three rounds of negotiations, which at times "have been tough", progress had been made on key issues.

"It's clear that we're out", one senior Conservative source said, adding that he was pleased to hear Ms May agree that no deal was better than a bad deal.

If Britain does continue with its current access to EU markets beyond Brexit day then this means it'll be forced to continue with the jurisdiction of the European Court of Justice (ECJ) until transitional phase comes to an end.

"It wouldn't be right for one party's court to have jurisdiction over the other", she said.

May offered no detail on this but said she was confident an "appropriate" mechanism for resolving disputes could be found. That payment would not form part of the "divorce settlement" covering the UK's outstanding debts and liabilities to the EU.