By Amanda Ferguson and Gabriela Baczynska
A Brexit deal is "eminently possible" within weeks but there can be no regulatory barriers within the United Kingdom, the head of the Northern Irish party that props up British Prime Minister Theresa May said on Tuesday.
Less than six months before the UK's exit from the European Union, there is little clarity about how the world's fifth largest economy and its preeminent international financial center will trade with the EU after Brexit.
Talks are snagged on how to avoid checks on the border between Northern Ireland and the Republic of Ireland if the sides fail to clinch a post-Brexit free trade deal.
May and Northern Ireland's Democratic Unionist Party (DUP), which supports her minority government, have opposed EU proposals for a backstop that would keep Northern Ireland - but not mainland Britain - de facto inside the EU economic space.
Ahead of a meeting with EU Brexit negotiator Michel Barnier in Brussels, DUP leader Arlene Foster stuck to her rejection of any new regulatory or customs barriers inside the United Kingdom - but said that, with political will, a deal was possible.
"I want to see a deal that works for everyone and I think that is eminently possible if the political will is there to make it happen," Foster told BBC Radio Ulster. "I very much hope that there is a deal in a number of weeks."
The EU's Brexit negotiators believe a divorce deal with Britain is "very close", diplomatic sources told Reuters last week, indicating a compromise on the future Irish border was in play.
A flurry of Brexit activity is expected over coming days.
Barnier will update the Commission on Wednesday and then EU ambassadors meet on Friday in Luxembourg. EU leaders' negotiators meet in Brussels on Monday.
But even if May clinches a deal, there is uncertainty on whether she could sell it at home, where she will need approval from the British parliament.
Lawmaker Steve Baker said at least 40 lawmakers in her Conservative Party were willing to vote down her possible Brexit deal if it left the UK 'half in and half out' of the EU.
If lawmakers reject a deal, May could fall and Britain would face leaving the EU without an agreement, a move investors and company chiefs say would weaken the West, panic financial markets and block the arteries of trade.
The United Kingdom would move from seamless trade with the EU to customs arrangements set by the World Trade Organization for external states.
"Colleagues will not tolerate a half-in, half-out Brexit," said Baker, who served as a junior Brexit minister in May's government until he resigned in protest at her proposals.
If 40 of her lawmakers voted against a possible deal, the fate of the government and exit process would depend on the opposition Labour Party, which has indicated it will vote against almost any deal May might secure.
Brexiteers accept there is likely to be some short-term economic pain but say Britain will thrive in the longer term if cut loose from what they see as a doomed experiment in German-dominated unity and excessive debt-funded welfare spending.
A 'hard' Brexit would result in extra tariffs of more than 3 billion euros ($3.4 billion) for German companies per year, a German institute said on Tuesday, adding that German exports to Britain could drop by up to 57 percent.
Under May's proposals, Britain will seek a free trade area for goods with the EU, largely by accepting a "common rulebook" for goods and British participation in EU agencies that provide authorizations for goods.
Some Brexiteers say those proposals would ensure the EU kept control over swathes of the British economy and thus run counter to the spirit of her manifesto pledge to leave the EU Customs Union and the Single Market.
(Writing by Guy Faulconbridge; editing by John Stonestreet)