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Merkel warns of tough Brexit negotiations in 2020

Britain will officially leave the European Union at 2300 GMT but will initially remain under EU rules for trade, travel and business during an 11-month transition period.

FILE: German Chancellor Angela Merkel. Picture: AFP

BERLIN - Chancellor Angela Merkel said Friday that Britain's departure from the EU "cuts deep" and warned of "intensive negotiations" this year over the two parties' future relationship.

"It cuts deep for Germany and all the remaining 27 member states, but we want to remain a close partner and friend of Britain," said Merkel in a video statement broadcast mere hours before the UK's membership ends.

"We are going to hold intensive negotiations with the British - that will define this year, particularly in the areas of economy and trade," said Merkel.

She added that Europe would defend its interests, especially when it came to the integrity of the single market.

"A lot will depend on Britain. The more Britain moves away from the conditions of the single market, the more our future relationship will have to change," she cautioned.

Britain will officially leave the European Union at 2300 GMT but will initially remain under EU rules for trade, travel and business during an 11-month transition period.

Flow chart showing what might happen next in the Brexit process. Picture: AFP

Speaking at a news conference in Berlin, the EU's new commissioner for the single market Thierry Breton said the bloc was "organised and ready" to start negotiating a trade deal with post-Brexit Britain.

"Our hand is outstretched but we are ready to defend European interests," he said.

The two sides have until the end of the year to negotiate their future relationship and trading arrangements.

If no agreement is reached by then, UK-EU trade will be done under World Trade Organisation rules, Breton said, "which may not necessarily be to the advantage of the British".

Merkel noted that an extension to the transition period was theoretically possible if requested by 1 July, but this has been ruled out by the UK government.

The chancellor insisted that the remaining 27 member states would remain united in their negotiations with the UK.

"European integration has brought Europe peace and prosperity.... We and the other 26 remaining member states are determined to continue this success story," said her spokesperson Steffen Seibert at a government news conference.