THE UK economy will benefit from sticking as closely as possible to European Union rules after Brexit, a senior MEP has said after talks with Theresa May.
Guy Verhofstadt, the European Parliament's Brexit co-ordinator, said he wanted the UK to sign an association agreement with the EU to cover its relationship after leaving the bloc.
Former Belgian prime minister Mr Verhofstadt visited Downing Street for talks with the Prime Minister, Brexit Secretary David Davis and Home Secretary Amber Rudd yesterday.
Mr Verhofstadt has warned that the European Parliament will not accept any deal on citizens' rights that involves discrimination against people who come to the UK during the transition period.
But in a sign that he believes the British Government may make further concessions, he told reporters in Downing Street: "I think it is possible that in the coming days and coming weeks we make progress on this, we can conclude on this."
Mr Verhofstadt also set out his vision for the future relationship between the UK and EU to be defined within an overall associate agreement rather than a Canada-style trade deal and a series of other pacts.
But he said the best outcome for the UK would be to remain in the single market and customs union, options ruled out by the Prime Minister.
"If the UK stays very near to the rules of the European Union that will secure jobs in Britain," he said.
"That will be the best way forward for the British economy.
"My preferential choice would be that Britain still is part of the single market, still is part of the customs union, then most problems would be solved.
"That is not the wish of the UK Government."
Meanwhile, the British Government has been told that France wants a "fair" Brexit settlement but the economically important financial services sector could not be covered by a free-trade agreement.
French economy minister Bruno Le Maire said there had to be a "good deal" with the UK, but the City of London and the financial sector would have to rely on an equivalence regime.
Meanwhile, Mr Le Maire was in London for talks with Chancellor Philip Hammond who will set out the Government's plans for the financial services sector today.
In her Mansion House speech on Friday, the Prime Minister set out her plans for Britain and the EU to access each other's financial markets based on a commitment to maintaining the same "regulatory outcomes".
Mr Le Maire said the particular circumstances of the financial services industry meant it could not be covered within the scope of a free-trade agreement and the "best solution" would be for equivalence, where both sides recognise each other's standards.
"So financial services cannot be in a free-trade agreement, but we have an alternative system which is called the equivalence regime," he told BBC Radio 4's Today programme.
