Taoiseach Micheál Martin believes negotiators can “square the circle” on Brexit this week.
He said that the mood among EU leaders is now on the up, after being “downbeat” last week.
Brexit trade deal talks are ongoing after another deadline came and went on Sunday evening.
But both sides of negotiators from the EU and UK have agreed to keep talking to avoid the disaster that would be the UK walking away with a no-deal.
Mr Martin has confidence that the will is there and that they will do everything they can to get a deal across the line.
Mr Martin said: “Clearly, what is happening within the talks is that both sets of negotiators conscious of the enormity and severity of a negative breakdown in talks and a no-deal Brexit have really sought to try and crack the level playing field (fair trade competition) issue along with fisheries and crucially the dispute mechanism that will underpin any level playing field framework.
“It seems to me the fact that they’ve continue to engage and they’ve decided to engage is a hopeful sign, without understating the enormous challenges facing both sets of negotiators in trying to square the circle around this playing field idea, around standards and as standards evolve over time, so that one side doesn’t get a competitive edge over the other.
“It was pessimistic midweek, then we had the EU Council meeting, you know, there was a degree of downbeat atmosphere about the place, then the President (EU Commission President Ursula von der Leyen) did say to me, they’re back engaging.”
Mr Martin added: “The 97% (of the deal already agreed) is very important because a lot of files were closed, a lot of texts were written and that was said to us by Michel Barnier.”
Meanwhile, EU chief negotiator, Mr Barnier, said that it’s possible there could be a temporary no-deal scenario for a while in January if talks are closing in on agreement.
Mr Barnier said the “next few days” are important if a deal is to be in place for January 1.
He said: “It is our responsibility to give the talks every chance of success.”
“Never before has such a comprehensive agreement (trade, energy, fisheries, transport, police and judicial cooperation etc) been negotiated so transparently and in such little time.”
A spokesman for the grouping of EU ambassadors said there is “full support for the resilient and persistent” negotiating team led by Mr Barnier.
The UK’s current trading arrangements with the EU expire at the end of the month, meaning any new deal would have to be in place by January 1.
If not, tariffs and quotas will apply and bureaucracy will increase, causing further damage to Irish, British and European economies already ravaged by coronavirus.
