LONDON — Britain’s Brexit negotiations with the European Union teetered on a precipice yet again Friday, after Prime Minister Boris Johnson declared that his government was fed up and ready for a no-deal exit from the bloc’s trading system, and with his chief negotiator calling off talks scheduled for next week in London.
European leaders reacted coolly to Mr. Johnson’s threat, making clear that they were ready to keep talking and acknowledging that both sides needed to give ground to reach a trade agreement by the deadline of Dec. 31.
Mr. Johnson, who had set a self-imposed deadline of this week to judge whether the talks should go on, delivered his warning after a summit meeting of European Union leaders in Brussels that resulted in what the prime minister called an unreasonable demand that Britain make the major concessions.
“They want the continued ability to control our legislative freedom, our fisheries, in a way that is obviously unacceptable to an independent country,” Mr. Johnson said in a taped statement from Downing Street. “With high hearts and complete confidence, we will prepare to embrace the alternative.”
For all his bluster, history suggested that the negotiations were less likely to collapse than to enter a climactic final act, promising even more of the theatrics and brinkmanship that have characterized the Brexit drama from the start.
There are genuine gaps between Britain and the European Union: The two are at odds over quotas for fishing — an issue that is highly sensitive politically in neighboring France. And the two sides have yet to agree on rules governing state aid to industry or a way to resolve disputes over this funding.
The calendar poses another risk: With the deadline for a deal fast approaching, even the loss of a week or more of talks could make it difficult for the two sides to reach a settlement in time. If they fall short, Britain would have to start trading with the bloc under what Mr. Johnson euphemistically calls Australia-style rules — in other words, under the default terms set by the World Trade Organization.
“We will prosper mightily as an independent free-trading nation, controlling our own borders, our fisheries, and setting our own laws,” he said.
In fact, analysts said, Britain would face severe disruptions, including long lines of trucks at the English Channel, and a heavy blow to its economic growth, on top of the already painful dislocation caused by the coronavirus pandemic. Britain’s battle to contain the latest wave of infections has all but eclipsed the latest Brexit news.
Given those daunting realities, analysts said they still believed that Mr. Johnson was bluffing and would end up striking a deal. The likelihood that Britain will have to compromise, they said, made it all the more important for the prime minister to look like he is driving a hard bargain with the European Union.
Sam Lowe, a senior research fellow at the Center for European Reform, a research institute, described the prime minister’s statement as “high-stakes theatrics” and said he still believed that a deal was more likely than not because both sides had recently shifted on some of their red lines.
“These sorts of performances are part and parcel of the negotiations,” he said. “We are at a crunch point where the difficult political compromises need to be made, but where there is also a need to appear tough for domestic audiences.”
Mr. Johnson’s move was a “controlled explosion,” said Mujtaba Rahman, an analyst at the political risk consultancy Eurasia Group. But it masked potential openings for compromise, particularly with France on fishing rights.
Downing Street argued that the European Union had effectively ended the talks by adopting formal conclusions from its summit that called on Britain to make compromises and made no mention of an intensification of talks.
British officials said there was no point in more negotiations next Monday unless the European Union was ready to discuss legal texts in an accelerated way without Britain being required to make all the moves.
Without such conditions, officials said, the only matter worth discussing would be practical preparations for a no-deal exit, including how to handle issues such as aviation, road haulage and nuclear cooperation.
European leaders, however, seemed to meet some of the conditions demanded by Britain, most notably when the German chancellor, Angela Merkel, acknowledged that there needed to be give and take on both sides.
“We have asked the United Kingdom to remain open to compromise, so that an agreement can be reached,” Ms. Merkel said on Thursday. “This of course means that we, too, will need to make compromises.”
On Friday, the European Commission president, Ursula von der Leyen, promised to “intensify” talks — as Britain has requested — and said her negotiating team would travel to London next week.
Later in the day, Downing Street said that Mr. Johnson’s negotiator, David Frost, told the Europeans that it made no sense for them to come, but added that he and his interlocutor, Michel Barnier, will still speak next week — suggesting that lines of communication remain open even if there will be no formal negotiations.
Mr. Barnier’s spokesman gave a different account of the conversation, saying that the two men agreed to talk again on Monday “to discuss the structure of these talks.”
Financial markets took the latest drama in stride — mindful, perhaps, that as long ago as February, Mr. Johnson threatened to walk away from the negotiations within four months if things did not go his way.
“Some saber rattling is part and parcel of any international trade negotiation,” wrote Kallum Pickering, senior economist with Berenberg Bank in London. “In our view, Johnson’s message seems to be more of a negotiating tactic in the hope of clinching a deal rather than a genuine desire to end ongoing talks immediately.”
British businesses were less relaxed, however, warning of huge price increases for consumers because of tariffs and border delays and disruptions.
“The prime minister’s statement signals that we are heading into very dangerous territory,” said Ian Wright, chief executive of the Food and Drink Federation, a British industry association, in a statement. “In the event of a no-deal Brexit, shoppers will — literally — pay a heavy price.”
Allie Renison, a senior policy adviser at the Institute of Directors, which represents Britain’s business leaders, said that “getting ready for no deal in the middle of a pandemic will be a herculean task for many businesses.”