David Davis is 'determined optimist' over EU exit despite Liam Fox warning

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Brexit Secretary David Davis says he is a "determined optimist" over Britain's withdrawal from the EU, despite the International Trade Secretary warning that Brussels must not be allowed to blackmail the UK.

Liam Fox said the EU must not force Britain into agreeing a divorce bill as the price for starting trade talks after a bruising third round of Brexit negotiations.

But Mr Davis will strike an upbeat note in a keynote address in Washington DC on Friday to stress the UK can secure a good divorce deal from the EU and will not turn isolationist after Brexit.

Mr Davis will be upbeat about Brexit when he addresses an audience in Washington DC
Mr Davis will be upbeat about Brexit when he addresses an audience in Washington DC (Virginia Mayo/AP)

He will tell an audience in the US capital: "I am a determined optimist.

"Because I fundamentally believe that a good deal is in the interests of both the UK and the EU and the whole of the developed world."

However Mr Fox, who has been in Japan with a delegation of 15 business leaders from the UK to drum up new trade for the UK, said Britain "can't be blackmailed into paying a price on the first part" when asked whether it was time for the UK to name its Brexit price.

"We think we should begin discussions on the final settlement because that's good for business, and it's good for the prosperity both of the British people and of the rest of the people of the European Union," he said.

The comments come after Mr Davis said the third round of Brexit talks had seen "tough" discussions regarding the size of the UK's exit bill.

Mr Davis said the third round of Brexit talks had seen tough discussions regarding the size of the UK's exit bill
Mr Davis said the third round of Brexit talks had seen tough discussions regarding the size of the UK's exit bill (Olivier Hoslet/AP)

The EU's chief negotiator Michel Barnier gave a negative assessment of the negotiations, saying there had been no "decisive progress" on key issues.

He said the two sides were still "quite far" away from meeting the test of making sufficient progress for talks on future trading arrangements to begin in October.

It follows warnings from the All-Party Parliamentary Group on EU Relations that leaving the customs union would be "reckless and economically dangerous".

Labour's Chuka Umunna and Tory Anna Soubry, who co-chair the newly-formed group, led calls from cross-party MPs for the Government to permanently remain in the customs union.

They said making an "ideological choice" to "wrench" Britain out of the free trade group would "unilaterally surrender the best economic option for our country".

Chuka Umunna led calls from cross-party MPs for the Government to permanently remain in the customs union
Chuka Umunna led calls from cross-party MPs for the Government to permanently remain in the customs union (Victoria Jones/PA)

A report by the group, titled The Case For Continued Customs Union Membership, states that the cost of leaving the customs union would be an estimated £25 billion annually.

Speaking to the US chamber of commerce, Mr Davis will insist that Brexit will not diminish the UK's global presence.

He will say: "By working together with our closest friends and allies ... we can tackle some of the greatest social and economic challenges we face.

"But the answer to that concern is not to turn inwards and become isolationist.

"And that is where a strong, outward looking United Kingdom can play an instrumental role."