Business groups have welcomed the announcement that Brexit talks are set to move onto issues of trade and transition.

The group that represents Irish business said today’s deal is a relief as it will allow trade talks to begin.

Ibec CEO Danny McCoy said the specific commitments relating to Ireland and an all-island economy are "a vital recognition of the unique challenges Irish business faces".

He said the early agreement of an extended transition period would take some pressure off, but "a final deal that delivers the closest possible relationship is the goal".

The British Irish Chamber of Commerce said businesses will be relieved by the commitment of the UK to avoid a hard border by maintaining full regulatory alignment with EU Single Market and Customs Union rules.

Director General John McGrane said: "This is something the Chamber has long advocated and is critical if we are to avoid a significant disruption to both north-south and east-west trade from 2019 onwards".

Speaking in Brussels he said that to provide certainty for business, however, the specific details of what constitutes "alignment" will have to be swiftly confirmed.

Chambers Ireland Chief Executive Ian Talbot also said that uncertainties remain for businesses and called for Phase 2 talks to being as soon as possible "so that when the inevitable complications emerge, they can be addressed early in the process".

The Irish Hotels Federation also welcomed confirmation today that there will be no "hard border" with Northern Ireland and the Common Travel Area will be retained following Brexit.

"This is a major boost for tourism across the island of Ireland and especially for the border counties, which are heavily reliant on visitors from Northern Ireland and Great Britain," the federation said in a statement.

The Federation of Small Business NI said the focus of negotiations needs to shift to the UK’s future relationship with the EU, which should include a guarantee by early next year, that there will be no cliff-edge moment on Brexit day.

Chairman Wilfred Mitchell said small firms employing EU citizens will be relieve to give their staff the certainty they need about the protection of their rights.

Director General of the British Chambers of Commerce Dr Adam Marchall said: "Businesses will be breathing a sigh of relief that 'sufficient progress' has been achieved.

"After the noise and political brinksmanship of recent days, news of a breakthrough in the negotiations will be warmly welcomed by companies across the UK."

CBI deputy director-general Josh Hardie said: "Firms have been watching negotiations closely and today's announcement will lift spirits in the run-up to Christmas. Sufficient progress is a present they've spent months waiting for.

"It's now time to focus on the true prize of a new relationship and a deal that starts from 40 years of economic integration.

"With the same willpower shown today and jobs and living standards at the heart of every negotiating objective, these talks can set the UK up for the next 40 years of close alignment.

The Ulster Farmers' Union said it is glad the deal reached in Brussels protects our free trade into the rest of the UK, which it says is its biggest and most profitable market.

UFU Deputy President Ivor Ferguson said: "We warned that anything that would threaten that would be unacceptable".

He said the union is hopeful that a practical deal will be reached to allow to retain access to the EU27 market.