Representatives from the Confederation of British Industry (CBI), which speaks for more than 190,000 UK businesses and seven million workers, is due to meet with Brexit Minister David Davis on Friday to push for the country's place inside the EU's single market to remain until the UK's exit negotiations have been completed.

"Negotiators on both sides of the UK-EU talks should aim to agree transitional arrangements as soon as possible," the CBI said in a statement ahead of the talks. 

"A limited period of transition, beginning when the Article 50 process ends, would provide firms with continuity and certainty, protecting jobs and trade flows," the statement added.

Two years of Brexit negotiations began last month after Prime Minister Theresa May formally invoked Article 50 of the EU's Lisbon Treaty.

Economy teeters

While May's mandate for a hard Brexit has weakened since Britain's snap elections in June, the impact of last year's referendum vote on the economy has been stark.

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The UK is the worst performing economy of western nations, while British consumers have suffered the longest decline in their spending power since the 1970s. Manufacturing has been hit as well, with Britain's car producers among those calling for a transitional agreement.

Mike Hawks, chief executive of the Society of Motor Manufacturers and Traders, called for a 'back-up plan' in order to protect Britain's status as an attractive market for car manufacturers to do business.

"We accept that we are leaving the European Union and we share the desire for that departure to be a success," said Hawks last month.

No to cliff edge

"But our biggest fear is that, in two years' time, we fall off a cliff edge - no deal, outside the single market and customs union and trading on inferior World Trade Organization terms. This would undermine our competitiveness and our ability to attract the investment that is critical for future growth."

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"Instead of a cliff edge, the UK needs a bridge to the new EU deal," CBI Director-General Carolyn Fairbairn said in a lecture given at the London School of Economics (LSE).

"Even with the greatest possible goodwill on both sides, it's impossible to imagine the detail will be clear by the end of March 2019. This is a time to be realistic.

"Agreement is needed fast - waiting until March 2019 is too late," she added when explaining the multiple barriers to a quick trade agreement between the UK and the EU.

rd/mm (AFPE, dpa)