As talks continued between the two sides in London, Foreign Secretary Dominic Raab said “I think we are into the last week or so of substantive negotiations.”

The U.K. left the EU early this year, but remained part of the 27-nation bloc’s economic embrace during an 11-month transition as the two sides tried to negotiate a new free-trade deal to take effect Jan. 1. Talks have already slipped past the mid-November date long set as a deadline for agreement to be reached if it is to be approved by lawmakers in Britain and the EU before year’s end.

Despite the stalemate, Raab told Sky News that “there’s a deal to be done.”

He said the two sides had made progress on “level playing field” issues — the standards the U.K. must meet to export into the EU.

The biggest hurdle appears to be fish, a small part of the economy with an outsized symbolic importance for Europe’s maritime nations. EU countries want their boats to be able to keep fishing in British waters, while the U.K. insists it must control access and quotas.

“On fisheries, there is a point of principle: As we leave the transition, we are an independent coastal state and we’ve got to be able to control our waters,” Raab said.

EU chief negotiator Michel Barnier, who met through the weekend with U.K. counterpart David Frost, has said there are still “significant divergences.”

If there is no deal, New Year’s Day will bring huge disruption, with the overnight imposition of tariffs and other barriers to U.K.-EU trade. That will hurt both sides, but the burden will fall most heavily on Britain, which does almost half its trade with the EU.

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