Merkel hopes May can find a way out Brexit maze by EU summit

By Padraic Halpin and Elizabeth Piper DUBLIN/LONDON (Reuters) - German Chancellor Angela Merkel said on Thursday she hoped discussions between Prime Minister Theresa May's government and the opposition Labour Party could break the Brexit impasse by an April 10 emergency European Union summit. Brexit is now mired in doubt, nearly three years since the United Kingdom shocked the world by voting 52 percent to 48 to leave the bloc. Supporters fear betrayal and opponents are pushing for another referendum. Unless May can agree to a closer post-Brexit economic relationship with the EU as advocated by Labour Party leader Jeremy Corbyn, Britain could be forced at the summit, two days before Britain is due to leave the bloc, into a long Brexit delay of around a year. May offered to quit to get her deal passed but it was defeated for a third time on Friday, the day Britain was originally due to leave the EU, so she turned to Labour. Two days of talks have not yet produced a way out of the maze. "We hope that intensive discussions in London can lead even by next Wednesday, when we will have our extraordinary summit, to a position that British Prime Minister Theresa May can present to us, that we can then discuss," Merkel told a news conference with Irish Prime Minister Leo Varadkar in Dublin. "We will then stay together as 27. We will do everything, as I've already said, to the last hour, to prevent a disorderly exit," Merkel said. Merkel added that there had been a lot of movement in the British position over the past few days. Varadkar said EU leaders must be patient while talks continue in London. Corbyn, a veteran socialist campaigner whom May has repeatedly derided as unfit for office, said on Wednesday that she had not moved far enough in talks which continued, at a lower level, for four and a half hours on Thursday. A Downing Street spokesman said Thursday's talks were "detailed and productive" and that they hoped to meet again on Friday, mindful of the need to make progress ahead of the European Council summit on Wednesday. Corbyn has insisted that May agree to a confirmatory referendum on any deal. The Guardian newspaper said a letter was being drafted from May's government to Labour with the idea that such an idea should be put to parliament. Labour did not call the talks productive but simply said they were detailed and technical. May's de-facto deputy, David Lidington, and Labour's Brexit point man, Keir Starmer attended the talks, along with the parties' business and strategy chiefs. Graphic - https://tmsnrt.rs/2CI8MwU CORBYN DEAL? Twenty-five lawmakers in Labour urged Corbyn to go the "extra step" if there was a chance of agreeing a Brexit deal. The 25 lawmakers, almost all from areas which voted to leave the EU in a 2016 referendum, said the talks "represent a real opportunity" for Corbyn, a way to get a deal which would meet Labour's demands for a Brexit that protected workers' rights. Finance minister Philip Hammond said that if talks with Labour failed, the government would try to take ideas from the discussions and present them to parliament, adding a confirmatory vote idea deserved to be tested in parliament. The Brexit vote exposed deep fractures in British society, though the crisis it triggered has also shown a political system in dire need of reform. It is unclear how, when or if Britain will leave the EU. The chaos has raised fears of a disorderly exit that would shock the British economy, roil financial markets and even hurt global trade. The European Central Bank has warned that markets need to price in a no-deal Brexit. Pro-Brexit lawmakers in Britain's upper house of parliament tried on Thursday to thwart the approval of a new law which would force May to seek a delay to prevent a disorderly EU exit on April 12 without a deal. After more than two years of tortuous discussions about the minutiae of the separation, EU leaders are weary of London's failure to agree its own divorce and patience is wearing thin. The EU is discussing different options: a delay until the end of the year, next spring or the end of 2020 though in recent days discussions have focused mostly on a one year delay. (Writing by Guy Faulconbridge; additional reporting by William James, Kylie MacLellan, Andrew MacAskill, William Schomberg and Kate Holton in London; Graham Fahy in Dublin; Gabriela Baczynska in Brussels and Paul Carrell and Thomas Escritt in Berlin; Editing by William Maclean)