Britain will propose setting up an interim customs agreement with the European Union after Brexit to allow the freest possible trade of goods.

But it will also seek the right to negotiate other trade deals.

One option to minimise friction when Britain leaves the bloc in March 2019 would be to introduce a temporary customs union which should be time-limited. That would provide certainty for businesses, since they fear the introduction of customs checks will cause expensive delays.

The intention is to seek an interim period with the EU of close association with the customs union that would allow for a smooth and orderly transfer to the new regime. By sorting out the customs arrangements, Britain and the bloc could avoid a hard border with EU member state Ireland.

In the meantime Britain will look to negotiate bold new trade relationships around the world. Britain is keen to move the talks with the EU forward to tackle the future relationship rather than focusing only on the split.

Countries that are part of the EU’s customs union are not allowed to negotiate bilateral trade deals. But Turkey, while not an EU member, is part of a separate customs union for industrial goods and can still negotiate bilateral trade deals.