Prime Minister Boris Johnson has upped the stakes on the eve of the eighth round of trade talks between the UK and EU by stating that a lack of a free trade deal agreement by mid-October would mean no trade deal.

Brexit is very much back on the agenda with a bump as EU diplomats explained their irritation at the UK’s stance, slightly dismissing it as ‘muscle-flexing’ and ‘self-defeating’ as talks enter the final weeks.

Two key issues remain which neither party is looking likely to make concessions over – that of access to UK fishing waters and rules regarding government intervention in struggling businesses.

In a statement on Facebook, Johnson stated that: “We are now entering the final phase of our negotiations with the EU.

“The EU have been very clear about the timetable. I am too. There needs to be an agreement with our European friends by the time of the European Council on 15 October if it’s going to be in force by the end of the year. So there is no sense in thinking about timelines that go beyond that point. If we can’t agree by then, then I do not see that there will be a free trade agreement between us, and we should both accept that and move on.

“We will then have a trading arrangement with the EU like Australia’s. I want to be absolutely clear that, as we have said right from the start, that would be a good outcome for the UK. As a Government we are preparing, at our borders and at our ports, to be ready for it. We will have full control over our laws, our rules, and our fishing waters. We will have the freedom to do trade deals with every country in the world. And we will prosper mightily as a result.

“We will of course always be ready to talk to our EU friends even in these circumstances. We will be ready to find sensible accommodations on practical issues such as flights, lorry transport, or scientific cooperation, if the EU wants to do that. Our door will never be closed and we will trade as friends and partners – but without a free trade agreement.

“There is still an agreement to be had. We will continue to work hard in September to achieve it. It is one based on our reasonable proposal for a standard free trade agreement like the one the EU has agreed with Canada and so many others. Even at this late stage, if the EU are ready to rethink their current positions and agree this I will be delighted. But we cannot and will not compromise on the fundamentals of what it means to be an independent country to get it.”

Read more: Brexit deal ‘seems unlikely’ this year

Earlier, the UK’s lead negotiator David Frost told the Mail on Sunday that the UK was more than ready to walk away from negotiations.

“We came in after a Government and negotiating team that had blinked and had its bluff called at critical moments and the EU had learned not to take our word seriously,” he said.

“So a lot of what we are trying to do this year is to get them to realise that we mean what we say and they should take our position seriously.”