Perspectives, UK-EU negotiations

Perspectives: Brussels can’t continue ignoring the United Kingdom 

Europe’s major countries need to be working together to buttress its economic and political strength. While strengthening the relationship with the United Kingdom won’t be easy, greater European Union engagement with the country is worth the effort.  

Arguably, the EU’s handling of Brexit has been its biggest success in recent years.  

Institutions and member states maintained unity during the negotiations. The key aims of preventing the UK cherry-picking from the single market and of avoiding border infrastructure reinstalment in Ireland were achieved. 

The UK is now the EU’s second largest export market for both goods and services. The EU enjoys a trade surplus with this partner. 

The Trade and Cooperation Agreement that came into force at the end of 2020 has largely worked for the EU. 

By contrast there is widespread disaffection with Brexit in the UK. There are regular reports of companies withdrawing from exporting to the EU due to trade barriers.  

These are not matched by success stories from new UK free trade agreements. 

The Labour Party is poised to win the upcoming general election and has committed to improving the country’s relationship with the EU.  

Their aims include greater cooperation on security, an SPS agreement for food safety and progress on mutual recognition of professional qualifications. 

There are considerable doubts in both London and Brussels as to whether these aims can be achieved or if they would even make a difference. Labour’s reluctance to directly engage with EU institutions for fear of a media backlash shows that problems remain. 

Arguably, relations between the UK and EU have improved since Rishi Sunak took over as Prime Minister in October 2022.  

Most significantly is the Windsor Framework agreement signed in February 2023 between London and Brussels. This new constructive atmosphere also helped unlock UK participation in the EU Horizon science research program. 

The agreement in late 2023 to extend the liberal origin rules for tariff-free trade in electric vehicles for three years was another success. This does however create another deadline at the end of 2026. 

There will be other discussions before that point. Data adequacy arrangements are due to expire at the end of 2025.  

A new agreement on fisheries and energy cooperation is needed before June 2026. Review of the implementation of the TCA is also scheduled for that year. 

Other changes will come sooner.  

For example, UK SPS checks on food arriving from the EU are progressively being introduced this year. Carbon Border Adjustment Mechanism schemes will potentially add to business costs. 

The Commission just initiated dispute settlement proceedings under the TCA with regard to the UK closure of a particular fishery

Meanwhile the UK’s implementation of the Windsor Framework raises serious concerns about its stability. In effect the unionist community in Northern Ireland were offered a veto on the implementation of new EU rules to restore devolved government. 

More UK-EU engagement on Northern Ireland seems likely in the next couple of years. 

Taken together, ongoing negotiations between the UK and EU are inevitable. Putting these on a firmer footing should save time and yield better results for both. 

More importantly, creating a better UK-EU relationship should also provide an incentive for investment. At a time when Europe’s competitiveness is in doubt, that is a prize worth pursuing. 

UK’s asks are becoming more realistic 

One big divide between the UK and EU is how the post Brexit negotiations were perceived. This is important in understanding the EU’s reluctance to engage afresh. 

What now seems to London a rather inept attempt at negotiation is seen as much worse by many in Brussels. Consistently since 2016 UK negotiators seem to be a rather worrying combination of incompetent, naive and malevolent. 

This has improved since 2022 but trust remains in short supply. There remains a belief that the UK wants the trade benefits of EU membership without matching commitments. 

Labour’s asks seem modest, but are also slightly elusive. This isn’t helping. 

To what extent they want to eliminate checks or align with EU regulation as part of an SPS agreement is unclear. Progress on professional qualifications also seems harder than what is presented. 

Conversations in London suggest that there will be realism, that this isn’t an ask to remove all trade barriers without any matching regulatory alignment. If anything, there may be the opposite problem: the EU asking too much in return. 

Wise heads in Brussels suggest that aligning expectations is the main reason why much stronger political relations will be needed before getting to formal negotiations. They also point out there are EU market access asks such as professional mobility. 

All of which is to say that much will remain unclear until serious and much broader engagement starts, most likely well into next year. 

If not the UK, then who? 

Commentators in both the EU and UK see closer security ties as an obvious first step in improving post-Brexit relations. Given the continued war in Ukraine and the prospects of an isolationist US under Trump, moving in that direction seems essential. 

Some would broaden out such cooperation into related areas such as economic, energy and food security. Certainly, there are many issues where interests are shared between EU and UK.  

One could thus easily imagine a set of cooperation structures akin to the EU and US Trade and Technology Council. 

There has always been a reluctance in Brussels to offer too much in the way of such discussions to the UK, as a deterrent to others thinking of leaving. Certainly, this is an argument for restrictions on participation in formal member state meetings. 

There is however a broader concept which the EU needs to consider. After Brexit there is a need to balance the needs of EU institutions with support for a stronger Europe as a whole. 

It is not in the EU’s interests to have an antagonistic relationship with the UK, even if some distance is inevitable. As an economy the whole of Europe competes with East Asia and North America. 

A Labour government is likely to represent as friendly a partner as the EU will find. If this cannot be used in a positive way, it will poorly reflect the blocs future prospects.  

History matters, and the last few years in UK-EU relations have undoubtedly been poor. A better future means moving on from this to find something better. 

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