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Keir Starmer's government has been told that forging a closer trade deal with the European Union is a "strategic necessity" for British firms, as a growing number of exporters report greater difficulty to do business under the UK’s post-Brexit agreement.

Mounting 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 current TCA was not supporting them grow their sales in the EU. Over 50% of exporters in a poll of nearly one thousand firms – most of whom were small and medium-sized companies – said the trade deal enacted in 2021 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 matter of political preference,” said Steve Lynch.

Pointing to a continuing economic cost from Brexit, the business group noted this figure represented a significant rise 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 growing recognition within the government's senior ranks about the economic impact of leaving the EU. Recently, Wes Streeting became the most recent cabinet minister to call for a deeper trading relationship with the EU, in remarks interpreted as a suggestion that Britain could join a customs union.

Such an arrangement would contradict Labour’s manifesto, which promised “no return” to the EU internal market, customs bloc, or free movement. The Prime Minister has previously insisted he could not foresee a situation 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 prefer the administration to take more ambitious steps.

Business Proposals for the 2026 Reset

According to a document setting out a “business manifesto for the EU reset”, the BCC said the government must prioritise its efforts to reduce barriers to trade for exporters to help boost 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 no impact in winning back any business into the EU,” said a manufacturer in Greater Manchester.

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

• A deal to cut border checks on agri-food goods.
• Completing connections between the UK and EU’s carbon markets.
• Creating 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: “We are cutting bureaucracy and obstacles to trade to support jobs, business, and growth. That’s exactly why we renewed our partnership with the EU and are making strong progress in negotiations.”