Prime Minister Boris Johnson has told the French leader that the UK will explore “every avenue” to reach a trade deal with the EU.
Mr Johnson spoke with Emmanuel Macron over the phone on Saturday morning as the deadline for securing an agreement nudges closer.
The PM told Mr Macron that the UK was actively looking to strike a deal, but that he was prepared to leave the Brexit transition period at the end of the year on “Australia-style terms” with the EU if needed.
Though the EU and Australia have agreements on trade, they currently do not have a full free trade deal and most trade is done on WTO rules.
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EU: ‘Significant gaps’ remain
An EU-UK trade deal needs to be reached before the end of October, to allow for the ratification of legislation before the end of the transition period on 31 December.
A Number 10 spokesman said: “The prime minister… set out the latest state of play in the negotiations on the future relationship between the UK and the EU.
“He confirmed the UK’s commitment to exploring every avenue to reach an agreement.
“He underlined that a deal was better for both sides, but also that the UK was prepared to end the transition period on Australia-style terms if an agreement could not be found.
“The prime minister emphasised that progress must be made in the coming days to bridge the significant gaps, notably in the areas of fisheries and the level playing field, through the process of intensive talks between chief negotiators agreed with the president of the European Commission.
“The leaders agreed to keep in touch on the issue.”
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Negotiators met in London on Friday for face-to-face talks, with more discussions set to be held next week.
Earlier in the week, Cabinet Office minister Michael Gove said there was a 66% chance of a deal being struck between the UK and EU.
He suggested there had been progress in the negotiations – despite ongoing differences on fisheries and other issues.