Johnson presses EU to give way amid no-deal Brexit warnings

LONDON» Prime Minister Boris Johnson pushed Britain closer to a no-deal exit from the European Union on Monday, insisting he will not hold Brexit talks with EU leaders unless the bloc lifts its refusal to reopen the existing divorce deal.

Johnson is trying to pressure the EU to give ground by intensifying preparations for the U.K. to leave in three months without a withdrawal agreement.

But the pound fell to a two-year low as business groups warned that neither Britain nor the EU is ready for a no-deal Brexit, and that no amount of preparation can eliminate the economic damage if Britain crashes out of the 28-nation trading bloc without agreement on the terms.

Johnson became prime minister last week after winning a Conservative Party leadership contest by promising the strongly proBrexit party membership that the U.K. will leave the EU on the scheduled date of Oct.31,withorwithoutadivorce deal.

The EU struck a withdrawal agreement with Johnson’s predecessor, Theresa May, but it was rejected three times by Britain’s Parliament. Johnson is insisting the bloc make major changes to May’s spurned deal, including scrapping an insurance policy for the Irish border that has been rejected by U.K. lawmakers.

“The withdrawal agreement is dead, it’s got to go,” Johnson said Monday as he visited a submarine base in Scotland. “But there is scope to do a new deal.”

He said he was “very confident” of getting a new agreement, even though Britain is due to leave the EU in less than 100 days, and the EU insists it won’t reopen negotiations or remove the border “backstop.”

Johnson has spoken to several EU leaders by phone since he took office but has no meetings scheduled. His spokeswoman, Alison Donnelly, said he would not agree to negotiations unless the bloc lifts its refusal to change the withdrawal agreement.

“He remains confident that the EU will stop claiming that the withdrawal agreement can’t be changed,” she said.

If they don’t, she added, “we must assume there will be no deal on the 31st of October.”

Before he took office, Johnson said the odds of Britain leaving the EU without a deal were a million to one.

Economists warn that leaving the bloc without an agreement on terms would disrupt trade by imposing tariffs and customs checks between Britain and the bloc. The British government’s financial watchdog says that could send the value of the pound plummeting further and push the U.K. into recession.

Another warning came from French automaker PSA, which said it could move production of its Vauxhall Astra model out of Britain if Brexit makes it unprofitable.

Vauxhall’s Ellesmere Port plant in Wales employs 1,000 people.