British Prime Minister Theresa May received a round of applause from European leaders on Thursday night, but there remain plenty of hurdles to overcome before the U.K. can leave the European Union (EU).
EU leaders are set to formally agree Friday to start the second phase of Brexit negotiations, mainly centered around trade talks.
At a summit dinner in Brussels, Belgium, on Thursday, May made a brief speech emphasizing the need for the U.K. and the EU to move forward together with negotiations. This was met with spontaneous applause from EU leaders.
European Commission President Jean-Claude Juncker said Friday that May was applauded because some “thought that indeed she did a big effort” to conclude phase one of the negotiations and “this needs to be recognized.”
However, analysts believe May will find future Brexit talks increasingly difficult.
“I expect very, very tough negations,” Zsolt Darvas, senior fellow at the Brussels-based think-tank Bruegel, told CNBC on Friday.
One of the issues set to dominate talks is the future of the financial services industry. “At the end, I think that access to financial services will be limited for U.K.-based firms and therefore a number of companies will relocate to the continent,” Darvas said.
