🔗 Share this article

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 greater difficulty to operate under the UK’s post-Brexit agreement.

Growing Exporter Frustration with Current Deal

Calling on Labour to accelerate its EU relationship reset, the leading business group stated that the UK’s existing trade and cooperation agreement was not supporting them grow their sales 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 substantial economic expansion or trade support, getting the EU reset right is now a business-critical need, not a political choice,” said the BCC’s director of international trade.

Highlighting an ongoing economic hit from Brexit, the business group noted this figure represented a 13 percentage point increase from the proportion of dissatisfied companies in a comparable poll a year earlier. It added that just a tiny fraction of the businesses surveyed believed government support on navigating new trade rules was comprehensive.

Calls for Action for a Deeper Relationship

This statement from the business group – which represents more than 50,000 firms – coincides with increasing awareness within Labour’s frontbench about the damage of Brexit. Recently, Wes Streeting became the latest top Labour politician 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 going back” to the EU single market, customs union, or freedom of movement. The Prime Minister has stated in the past he could not foresee a situation where the UK re-entered the EU in his lifetime.

However, several pro-European ministers are believed to be among those who would like to see the government go further.

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 all but ceased. The TCA has had zero effect in recovering any sales into the EU,” said a manufacturer in the North West.

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

• A deal to cut border checks on agri-food goods.
• Finalising linkages between the UK and EU’s emissions trading schemes.
• Establishing a youth mobility scheme.
• Securing full UK participation in the EU’s defence fund.
• Enhancing cooperation on tax and border simplification.

An official representative said: “This government is removing red tape and obstacles to trade to support jobs, business, and growth. This is precisely the reason we renewed our partnership with the EU and are making significant headway in negotiations.”