Keir Starmer Informed Stronger EU Trade Ties Are a 'Strategic Necessity' for UK Companies

The Labour administration has been advised that forging a closer trade deal with the European Union is a "critical imperative" for British firms, as a growing number of exporters report finding it tougher to operate under the UK’s post-Brexit agreement.

Mounting Business Dissatisfaction with Post-Brexit Arrangements

Urging the government to hasten its EU relationship reset, the British Chambers of Commerce stated that the UK’s current TCA was not supporting them grow their sales in the EU. Over 50% of exporters in a survey of almost 1,000 businesses – most of whom were small and medium-sized companies – said the trade deal negotiated by Boris Johnson’s government was not helping them.

“With a budget that failed to deliver substantial economic expansion or trade support, getting the EU reset right is now a strategic necessity, not a matter of political preference,” said the BCC’s director of international trade.

Highlighting an ongoing economic hit from Brexit, the trade body noted this figure represented a 13 percentage point increase from the proportion of unhappy firms in a similar survey a year earlier. It added that just a tiny fraction of the businesses surveyed believed government support on trade policy changes was adequate.

Political Pressure for a Deeper Relationship

The intervention by the trade body – which represents more than 50,000 firms – comes amid increasing awareness within Labour’s frontbench about the damage of Brexit. Recently, a senior Labour figure became the most recent cabinet minister to call for a deeper trading relationship with the EU, in remarks seen as hinting that Britain could enter into a customs arrangement.

Such an arrangement would contradict Labour’s manifesto, which promised “no return” to the EU internal market, customs bloc, or free movement. Starmer has also stated in the past he could not foresee any circumstances where the UK re-entered the EU in his lifetime.

However, several ministers favouring closer EU links are believed to be among those who would like to see the government go further.

Business Proposals for the 2026 Reset

In a report setting out a “business manifesto for the EU reset”, the business group said the government must prioritise its efforts to reduce barriers to trade for exporters to support growth in the UK economy. Quoting frustrated survey respondents, it said firms were finding it ever harder to navigate changes in EU and UK laws since Brexit.

“Our overseas sales since leaving the EU have all but ceased. The TCA has had zero effect in winning back any business into the EU,” said one small manufacturing firm in Greater Manchester.

The BCC outlined several main recommendations for negotiations with the EU in 2026, including:

• An agreement to reduce inspections on agri-food goods.
• Completing connections between the UK and EU’s carbon markets.
• Creating a scheme for young people to work and travel.
• Gaining British involvement in the EU’s defence fund.
• Improving collaboration on tax and border simplification.

A government spokesperson said: “We are cutting bureaucracy and obstacles to trade to support jobs, business, and growth. This is precisely the reason we reset our relationship with the EU and are making significant headway in negotiations.”