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Sam Lowe of the Centre for European Reform think tank says that sectors which traditionally find rules of origin burdensome include textiles, food, machinery and vehicles.

Agreeing on what the backstop will look like has, therefore, become the central and most urgent issue in Brexit talks. As trade expert, Sam Lowe, wrote for BI last month: "The can kicking cannot go on forever." 

Trade expert Sam Lowe from the Centre for European Reform told The Times the UK is playing two games with the EU. He says the government doesn't want to appear too critical of Trump in light of Brexit but the UK is still hiding behind the bloc in the hope of curbing the measures.

The EU may have once thought about including financial services in trade deals but won't do for the Brits. It's time for the UK to get real give hopes on "mutual recognition", writes Samuel Lowe at the Centre for European Reform: "Behind closed doors, member-state representatives say that comprehensive mutual recognition is not something an FTA can allow in and of itself. It would also require the EU to change many of its laws, which only provide certain rights to financial institutions incorporated within the territories of member-states of the EU and the European Economic Area. In itself, this would not be an impossible hurdle to clear, but it would require the will to offer mutual recognition in the first place, which is currently absent on the continent."

Charles Grant, director of the Centre for European Reform, is sympathetic to the people’s vote campaigners, but he sees little chance of any of the above happening and gives them just a “1 or 2 per cent chance” of stopping Brexit. He concedes that a dramatic shift in public opinion – to, say, 60-40 against leaving the EU – could change the dynamics, but cannot foresee such a change. He fears that too many of the campaigners are “naively optimistic” London-based members of the middle-class liberal elite who are simply preaching to the converted.

With Brexit talks going through one of its rougher patches (and it will no doubt get worse before next month’s European Council), observers may want to keep their eyes on the horizon to avoid getting bogged down in short-term diversions. And what is emerging out of the distant haze is that the UK may end up seeking a long-term relationship with the EU based on a customs union and accepting single market rules and jurisdiction for the production and trade in fish, agricultural and industrial goods but not services. Over the past few months, the logic of such a model has been outlined here and in briefings by the Centre for European Reform.