BRUSSELS: The EU reiterated Tuesday that it would not address the issue of Britain’s future partnership with the bloc post-Brexit until progress had been made on the terms of withdrawal.
Responding to a new British position paper released Tuesday, a European Commission spokesman noted Britain’s proposal for a temporary customs union after leaving the EU.
But, he added: “We will only address them once we have made sufficient progress on the terms of the orderly withdrawal.”
Britain’s membership of the EU customs union, which allows for the tariff-free movement of goods, will end along with its membership of the single market when it leaves the bloc in March 2019.
It wants to negotiate transitional arrangements to soften the effect of Brexit.
One option its Department for Exiting the EU suggested in a statement Tuesday is “a temporary customs union between the UK and the EU.” It will publish a full paper on that proposal later Tuesday.
The Brexit Ministry said Britain wanted to be able to sign trade agreements with non-EU countries during the transition period, though these would be implemented only at the end of it.
Brexit Minister David Davis told BBC radio on Tuesday that the transition period could last “something like two years” and would have to be over by the time of the next general election, which is set for 2022.
But a Commission spokesman insisted Tuesday that “an agreement on a future relationship between the EU and the UK can only be finalized once the UK has become a third country.”
“As Michel Barnier has said on several occasions, ‘frictionless trade’ is not possible outside the Single Market and Customs Union,” the EU spokesman said.
Barnier, the chief negotiator for the EU in the Brexit talks, later posted on Twitter that the EU would not budge on its Brexit stance.
“The quicker UK & EU27 agree on citizens, settling accounts and Ireland, the quicker we can discuss customs & future relationship,” Barnier tweeted.
Experts have warned that it will be extremely difficult to negotiate a new EU-UK free trade agreement before Britain leaves the bloc — particularly as Brussels has so far refused even to start trade talks.
The EU says there must first be broad agreement on three key issues: Britain’s financial settlement, expatriate rights, and the status of the border between British-controlled Northern Ireland and Ireland.
Britain will publish its proposals on the Northern Ireland border issue on Wednesday, before the third round of Brexit negotiations in Brussels at the end of the month.
The EU itself is currently working on another series of position papers, “including one on customs issues related to the orderly withdrawal of the UK,” the EU statement said, without indicating when it would be published.
The next round of Brexit negotiations between Britain and the EU is scheduled for the week beginning August 28.
Progress on terms of Brexit first: EU
Progress on terms of Brexit first: EU
Lufthansa adds more flights to Asia, Africa as Middle East war reshapes air travel
- Airlines across Europe have been redirecting capacity after suspending services in the Middle East
- Lufthansa said the move also helps meet demand on long-haul routes that Middle Eastern carriers cannot currently serve
LONDON: Lufthansa said on Friday it was shifting capacity from 10 canceled Middle Eastern destinations to routes such as Singapore and Bangkok as it contends with disruption from the US-Israeli war on Iran.
Airlines across Europe, including budget carrier Wizz Air , have been redirecting capacity after suspending services in the Middle East.
Lufthansa said the move also helps meet demand on long-haul routes that Middle Eastern carriers cannot currently serve.
Airline stocks have slumped this week as US and Israeli airstrikes on Iran — and retaliatory strikes by Iran across the Middle East — have disrupted long-haul flights and sent oil prices soaring.
“The war in the Middle East proves once again how exposed air traffic is and how vulnerable it remains,” Lufthansa CEO Carsten Spohr said in a statement. He added the outlook was uncertain, particularly for jet fuel costs.
The schedule changes came as the German group reported better-than-expected 2025 results, saying stricter financial management and fleet renewal had helped contain costs and lift profits. Its shares rose as much as 4 percent, before reversing to trade down 1.2 percent at 1246 GMT.
The company said demand on routes to and from Asia and Africa had risen strongly since the conflict began on Saturday, and it would stick with its focus on expanding long-haul services. Spohr said new flights to Asia would launch in days.
Lufthansa did say how many services it had canceled because of the conflict.
While carriers face costs for rescheduling and rerouting, the biggest impact for those outside the Middle East is expected from surging fuel prices. Brent crude futures have jumped more than 20 percent this week.
Spohr said Lufthansa was well hedged in the short term. The group hedges fuel up to 24 months ahead and was 85 percent hedged as of December 31, according to its annual report.
RESILIENCE
European carriers, including Lufthansa, benefited from slightly lower fuel bills in 2025. Lufthansa’s fuel bill fell 7 percent, helping support earnings as passenger demand stayed firm.
“Last year we were able to significantly increase the Group’s operating profit and achieved the highest revenue in our history. Our results demonstrate the resilience and stability of the Group,” Spohr said.
Lufthansa reported an adjusted operating profit of 2 billion euros ($2.3 billion), compared with 1.9 billion euros forecast in a company-compiled analyst poll and up from 1.6 billion euros in 2024. The group also posted an operating margin of 4.9 percent, up from 4.4 percent a year earlier.
Lufthansa aims to lift operating margins to 8 percent-10 percent between 2028 and 2030 from 4.4 percent in 2024, but strikes by workers, including the most recent on February 12, have made it harder to boost profitability.
Bernstein analyst Alex Irving said ongoing weakness in the passenger airline segment persisted, but that strong performances in Cargo and Lufthansa Technik helped lift profits.
The carrier said the outlook for 2026 was unclear due to geopolitical uncertainty. It projected capacity growth of 4 percent, alongside increased revenue and profit margin.
