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

Keir Starmer's government has been told that securing a deeper trading relationship with the European Union is a "strategic necessity" for British firms, as a growing number of exporters report finding it tougher to operate under the existing post-Brexit trade deal.

Growing Exporter Frustration with Post-Brexit Arrangements

Urging the government to hasten its EU relationship reset, the leading business group stated that the UK’s existing trade and cooperation agreement was failing to help them increase exports in the EU. Over 50% of exporters in a poll of nearly one thousand firms – the majority of which were small and medium-sized companies – said the trade deal negotiated by Boris Johnson’s government was not helping them.

“Following a budget that did not to deliver meaningful growth or trade support, getting the EU reset right is now a strategic necessity, not a political choice,” said Steve Lynch.

Pointing to a continuing economic cost from Brexit, the trade body noted this figure represented a significant rise 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 navigating new trade rules was comprehensive.

Calls for Action for a Deeper Relationship

The intervention by the trade body – which represents more than 50,000 firms – coincides with growing recognition within Labour’s frontbench about the damage of Brexit. Recently, Wes Streeting became the most recent cabinet minister 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. The Prime Minister has stated in the past he could not foresee any circumstances where the UK rejoined within his lifetime.

However, several pro-European ministers are believed to be among those who would prefer the administration to take more ambitious steps.

Business Proposals for the EU Negotiations

In a report setting out a “business manifesto for the EU reset”, the BCC said the government must prioritise its efforts to minimise trade friction 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.

“Our overseas sales since leaving the EU have virtually stopped. The TCA has had zero effect in winning back any business into the EU,” said a manufacturer in the North West.

The BCC outlined several main recommendations for talks with Brussels in 2026, including:

• An agreement to cut border checks on animal and plant products.
• Completing connections between the UK and EU’s carbon markets.
• Establishing a scheme for young people to work and travel.
• Securing full UK participation in the EU’s security and defence fund.
• Enhancing cooperation on VAT and customs simplification.

A government spokesperson said: “We are removing red tape and trade barriers to boost employment, companies, and the economy. That’s exactly why we reset our relationship with the EU and are making significant headway in negotiations.”