European Union leaders will on Saturday agree to take a tough approach in negotiations on Brexit, making clear that Britain cannot enjoy the economic benefits of EU membership after it leaves.

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In a letter to the leaders ahead of the summit in Brussels, European Council President Donald Tusk stressed that there could be no discussion about a future trade deal with Britain before sufficient progress is made on issues surrounding its withdrawal.

“This is not only a matter of tactics, but - given the limited time frame we have to conclude the talks - it is the only possible approach. In other words, before discussing our future, we must first sort out our past,” he said.

“In other words, before discussing our future, we must first sort out our past,” the letter added. “We need to secure the best guarantees for our citizens and their families. Guarantees that are effective, enforceable, nondiscriminatory and comprehensive, and which should be accompanied by simple and smooth administrative procedures.

“We should also agree with the UK that all financial obligations undertaken by the EU of 28 will be honoured also by the UK. Finally, in order to protect the peace and reconciliation process described by the Good Friday Agreement, we should aim to avoid a hard border between the Republic of Ireland and Northern Ireland.”

Mr Tusk identified the immediate priorities as the rights of EU citizens in Britain and British citizens in the EU, a settlement of Britain’s financial obligations, and measures to avoid a hard Border between the two parts of Ireland.

“I would like us to unite around this key principle during the upcoming summit, so that it is clear that progress on people, money and Ireland must come first. And we have to be ready to defend this logic during the upcoming negotiations,” he said.

The guidelines call for “flexible, imaginative solutions” to avoid a hard Border and to protect the peace process and for the EU to recognise bilateral agreements between Britain and Ireland if they are compatible with EU law. The leaders are also expected to agree that, if the people of Northern Ireland choose in the future to become part of a united Ireland, the territory would automatically become part of the EU.

This principle, which echoes the experience of East Germany after German unification in 1990, will be recorded as a “statement for the minutes”, the equivalent of Council conclusions at a formal summit. The summit, which is scheduled to last for just three and a half hours, will include a brief discussion of the negotiating guidelines but Irish officials are confident that there will be unanimous support for prioritising issues surrounding Brexit’s impact on Ireland.

Some central and eastern European leaders are likely to stress the importance of taking a firm approach to protecting the rights of their citizens in Britain. And some net contributors to the EU budget, including Sweden and the Netherlands, will make clear that they are not willing to make up for any budgetary shortfall caused by the departure of Britain, one of the biggest net contributors to the EU.

The guidelines will define the EU’s overall interests in the forthcoming negotiations as “to preserve its interests, those of its citizens, its businesses and its member-states”. They will also rule out any “cherry-picking” by Britain of the benefits of the single market, including deals for access to the market for some sectors.

“A non-member of the Union, that does not live up to the same obligations as a member, cannot have the same rights and enjoy the same benefits as a member,” they will say.

German chancellor Angela Merkel warned on Thursday that Britain should have no illusions about its status after it leaves the EU, that of a “third country” which cannot enjoy the rights of EU membership. European Commission President Jean-Claude Juncker is reported to have been alarmed by the unrealistic expectations of the British side when he met Theresa May for dinner in London this week.

Ms May said later that the remaining 27 member-states were “lining up to oppose” Britain in the negotiations, claiming that she needs a big Conservative majority in June’s election to strengthen her own hand.