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Keir Starmer's government has been told that securing a deeper trading relationship with the European Union is a "critical imperative" for companies in Britain, as a growing number 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 leading business group 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 small and medium-sized companies – said the trade deal enacted in 2021 was not helping them.

“With a budget that failed to deliver meaningful growth or trade support, getting the EU reset right is now a business-critical need, not a political choice,” 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 dissatisfied companies in a comparable poll a year earlier. It added that just a tiny fraction of the businesses surveyed believed government support on trade policy changes was comprehensive.

Calls for Action for a Deeper Relationship

This statement from the business group – 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 latest top Labour politician to advocate for closer economic ties with the EU, in remarks seen as hinting that Britain could enter into a customs arrangement.

This kind of proposal 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 any circumstances where the UK rejoined within his lifetime.

However, several ministers favouring closer EU links are believed to be among those who would like to see the government go further.

Key Recommendations for the 2026 Reset

In a report setting out a “business manifesto for the EU reset”, the BCC said the government must focus its work to minimise trade friction for exporters to support growth in the UK economy. Citing comments from annoyed businesses, it said firms were finding it increasingly difficult to navigate changes in EU and UK laws since Brexit.

“Since Brexit our export sales have all but ceased. The TCA has had no impact in winning back any business into the EU,” said one small manufacturing firm in Greater Manchester.

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

• A deal to reduce inspections on animal and plant products.
• Finalising linkages between the UK and EU’s carbon markets.
• Establishing a youth mobility scheme.
• Securing full UK participation in the EU’s defence fund.
• Improving collaboration on tax and border simplification.

A government spokesperson said: “We are cutting bureaucracy and trade barriers to boost employment, companies, and the economy. That’s exactly why we reset our relationship with the EU and are making strong progress in negotiations.”