Both sides have made positive signals in recent days though also indicated they were still short of a deal, which would define the divorce terms and include an European Union declaration stating that it would seek the closest possible ties with Britain after Brexit ranging from trade to security to research.
Citing figures to make its case, the report noted that the EU (together with the European Free Trade Association) accounted for 43% of Britain's services exports in 2016, worth around than £110 billion to the United Kingdom economy.
As manufacturers of cars and other goods warn the Theresa May government of job losses and other impact of Brexit, a report promoted by former prime minister Tony Blair on Thursday flagged the adverse fallout on services exports and cautioned that a trade deal with India will be "hard".
Commenting on the Irish backstop, Barnier said the EU's plan to keep Northern Ireland in the Single Market and customs union would help keep the border invisible - a goal of both sets of negotiators. Policing of the deal and agreeing rules on produce such as camembert cheese and Parma ham that is protected inside the European Union against imitations from elsewhere needed more polishing, he added.
A senior DUP MP said a Commons vote on Wednesday night that saw the party abstain on a piece of legislation for the first time since signing a pact to keep the Conservatives in power was a "warning" to the Government.
However, the Brexit spokesman of the Democratic Unionist Party (DUP), May's parliamentary partner, said the DUP's 10 members of parliament would vote against the United Kingdom budget and consider voting no-confidence in May if the British government breaks the DUP's red lines in Brexit talks.
No 10 made clear if the DUP voted down the Budget, Mrs May would not quit.
New British proposals over the Irish border "backstop" have raised hopes that a deal can be reached at the crucial European Council summit which begins in Brussels next Thursday.
Her intervention came as Mrs May met key members of her cabinet in Downing Street to brief them on the progress in the Brexit negotiations.
She added: "The Prime Minister is a Unionist".
It will follow another Whitehall meeting of the Joint Ministerial Committee, which will be attended by Mr Lidington and his colleagues Dominic Raab, the Brexit Secretary, and David Mundell, the Scottish Secretary.
The Northern Ireland Retail Consortium (NIRC), which was also at the meeting, said the deal on the table was uniquely beneficial to Northern Ireland's economy, which would suffer disproportionately from Brexit.
Michel Barnier, the EU's chief Brexit negotiator, said yesterday that a deal on the Withdrawal Agreement is "within reach", but only if Britain remains in a customs union with the EU. "I sympathize with her on that but there is no answer to that problem", he told the audience.
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