David Davis is holding a string of meetings in Germany to win over support for favourable post-Brexit trade terms amid claims Berlin is considering backing privileged access in return for payments to Brussels.
The Government wants a bespoke trade deal covering both goods and services after the UK leaves the bloc but the European Union has been resistant to the calls.
Brussels’ chief Brexit negotiator Michel Barnier has urged European companies with commercial links to the UK to start preparing for increased “friction” in trade.
But officials in a number of European capitals are open to considering plans to allow access to the single market in return for “substantial payments” to the EU, according to The Times.
“If Britain wants to trade budget contributions for access to (the) single market for the City, there will be many takers,” a European diplomat said.
Mr Davis is holding a series of private meetings in Munich with business leaders and officials as part of a charm offensive to secure support for good trade terms after Brexit.
The Brexit Secretary’s visit comes after Philip Hammond headed to Berlin to call for clarity on what the EU wants from future relations.
The Chancellor warned against talk of punishing Britain for leaving and insisted it “takes two to tango”.
At the Die Welt economic summit dinner, Mr Hammond said: “They say, ‘It takes two to tango’: Both sides need to be clear about what they want from a future relationship.
“I know the repeated complaint from Brussels has been that the UK ‘hasn’t made up its mind what type of relationship it wants’, but in London many feel that we have little, if any, signal of what future relationship the EU27 would like to have with a post-Brexit Britain.
“Since the referendum in the UK, there has been a marked asymmetry between the enthusiasm expressed by certain third countries to pursue future trade deals with the UK and the relative silence, in public at least, from Europe on what the EU wants our future relationship to look like.
“I am saying this to you tonight because I fear that many EU opinion-formers see this as a question only for British politicians, for British voters to resolve, before they engage with the EU27.
“By signalling a willingness to work together in a spirit of pragmatic co-operation on a future, mutually beneficial, partnership based on high levels of access for goods and services, continued close co-operation in security and defence, in education, science, technology and culture, putting behind us any narrative of ‘punishment’ for leaving and focusing on the mutually beneficial relationships we have now and can continue in the future, the EU will send a message to the British people which will resonate as they consider the options for their future.”