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Brexit deal must be worse than terms of EU membership, says Maltese PM

Maltese Prime Minister Joseph Muscat has said the UK must not gain advantages from leaving the EU. European Commission President Jean-Claude Juncker has reiterated that Brexit does not spell the end for the bloc.

Addressing journalists in the Maltese capital Valletta on Wednesday, European Commission President Jean-Claude Juncker said that "if we are considering the Brexit case as the beginning of the end we will make a major mistake."

At the same conference, Maltese Prime Minister Joseph Muscat said any deal between Britain and the EU must be worse than the terms of its membership. 

"We want a fair deal for the UK but that fair deal has to be inferior to membership," Muscat said, as Malta took on the six-month rotating EU presidency.

"I have rarely been at a discussion on any other subject where the 27 member states have basically the same position," said the premier, whose country is a former British colony.

Muscat said there would be only "one contact point" for negotiations - the European Commission - which "would, from time to time, consult with EU governments when a political decision would need to be made."

Some 52 percent of the UK voted to leave the EU in a referendum last June, but is yet to start formal negotiations with the other 27 countries on the terms of its exit and its future relationship.

May or May not?

UK Prime Minister Theresa May has said she will trigger Article 50 of the Lisbon Treaty - starting formal negotiations with the EU - by the end of March.

Amid speculation it will take longer to establish Britain's new trade ties with the bloc, there are growing calls for some kind of transitional deal.

May's position remains unclear, with free movement of labor and immigration controls dominating the domestic British debate.

On Wednesday May distanced herself from remarks by a junior minister who suggested Britain was considering introducing an annual  £1,000 (1,150 euros, $1,200) post-Brexit "immigration skills charge" on every skilled worker from an EU member state recruited by a British employer.

Former Belgian Prime Minister Guy Verhofstadt, the European parliament's representative in the Brexit process, called the proposal "shocking."

UK Prime Minister Theresa May

UK Prime Minister Theresa May

"Imagine, just for a moment, what the UK headlines would be, if the EU proposed this for UK nationals?" he wrote on Twitter.

Government expects to lose landmark case

"The Guardian" newspaper reported earlier on Wednesday that UK cabinet ministers have privately said that the government is likely to lose a landmark legal case on Brexit in the supreme court.

The paper reported that they have drawn up two versions of a bill that could be tabled after the ruling.

Ministers reportedly hope the court will allow May to put together a short - so-called three-line bill - which is focused on Article 50 itself and difficult for MPs to amend.

German left links free labor with capital movement

Germany's Social Democrats (SPD) said on Wednesday that UK single market membership must be tied to free movement.

The SPD said it would be prepared to let the country's own short-term economic interests take a back seat and make the "unity of the EU" a priority in the upcoming Brexit negotiations if it were to form part of the next government.

The SPD - a junior partner to Angela Merkel's Christian Democratic Union (CDU) in Germany's coalition government - is also understood to be considering a push for a parliamentary vote on the terms of Britain's exit from the EU. This could delay the timetable following the expected triggering of Article 50 in March.

The SPD is currently second in the polls to CDU, making it likely to play a part in the formation of Germany's next coalition government after federal elections in September, either in another "grand coalition" with the center-right or a so-called "Red-Red-Green" or "R2G" coalition with the Left and Green parties.

The resolution would strengthen Merkel's stance regarding the indivisibility of free movement and the single market. It also highlights the rift between the British Labour party and the continental European left.

Bank of England lowers Brexit risk warning

Meanwhile, Bank of England governor Mark Carney said also on Wednesday that Brexit was no longer the biggest risk to the UK'S financial stability.

Asked by MPs whether the June vote to leave the EU remained the most significant near-term risk, he said: "Strictly speaking, the view of the [Bank's financial policy] committee is no."

Opponents of Brexit warned before the referendum on June 23 that a vote to leave the EU could spark a financial crisis.

Watch video 02:07

Britain's envoy to the EU has resigned: Max Hofmann reports from Brussels

jbh/ksb (AFP, Reuters)

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