Keir Starmer's government has been told that forging a closer trade deal with the European Union is a "critical imperative" for British firms, as an increasing proportion of exporters report finding it tougher to operate under the UK’s post-Brexit agreement.
Growing Exporter Frustration with Post-Brexit Arrangements
Calling on Labour to accelerate its EU relationship reset, the British Chambers of Commerce stated that the UK’s existing trade and cooperation agreement was not supporting them increase exports in the EU. More than half of exporters in a poll of nearly one thousand firms – the majority of which were SME companies – said the trade deal negotiated by Boris Johnson’s government was not helping them.
“Following a budget that did not to deliver substantial economic expansion or trade support, getting the EU reset right is now a business-critical need, not a matter of political preference,” said Steve Lynch.
Highlighting an ongoing economic hit from Brexit, the business group noted this figure represented a 13 percentage point increase from the proportion of unhappy firms in a comparable poll a year earlier. It added that just four out of the 946 firms surveyed believed government support on trade policy changes was comprehensive.
Political Pressure for a Closer Partnership
The intervention by the trade body – which represents more than 50,000 firms – coincides with increasing awareness within the government's senior ranks about the damage of Brexit. Recently, a senior Labour figure became the latest top Labour politician to advocate for closer economic ties with the EU, in remarks interpreted as a suggestion that Britain could join a customs union.
Such an arrangement would clash with Labour’s manifesto, which promised “no going back” to the EU internal market, customs bloc, or free movement. Starmer has also previously insisted he could not foresee a situation where the UK rejoined within his lifetime.
However, several ministers favouring closer EU links are believed to be among those who would prefer the administration to take more ambitious steps.
Key Recommendations for the EU Negotiations
According to a document setting out a “corporate blueprint for the EU reset”, the BCC 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 increasingly difficult to navigate changes in EU and UK laws since Brexit.
“Since Brexit our export sales have virtually stopped. The TCA has had zero effect in recovering any sales into the EU,” said one small manufacturing firm in the North West.
The BCC outlined five key proposals for talks with Brussels in 2026, including:
- An agreement to reduce inspections on agri-food goods.
- Completing connections between the UK and EU’s emissions trading schemes.
- Establishing a scheme for young people to work and travel.
- Gaining British involvement in the EU’s security and defence fund.
- Enhancing cooperation on tax and border simplification.
A government spokesperson said: “We are removing red tape and obstacles to trade to boost employment, companies, and the economy. This is precisely the reason we renewed our partnership with the EU and are making significant headway in negotiations.”
