The EU and the UK are doomed to cooperate
There are compelling reasons for the European Union and United Kingdom to put the adversarial period of Brexit behind them

Brexit was a traumatic divorce. When the United Kingdom left the European Union, it split from the single market and customs union, and left EU institutions and programmes. But it is less remarked that at a summit in April 2017, where EU leaders took a position on the negotiations over the UK’s withdrawal, a similarly adversarial stance was adopted, inspired by the idea of creating an example for any other countries that might consider leaving.
Since then, the threat of more departures seems to have faded. In Italy, Prime Minister Giorgia Meloni, once considered an ultranationalist, plays a constructive role in the EU. The plans of extremist parties to leave the euro and the EU have been dropped. In the UK, meanwhile, the government has to decide whether to make deals with the EU and drop some of its red lines now or face further depression of its dismal economic growth.
And then there is Trump. The liberal international rules-based order is under threat. Trump seems set on further undermining the institutions that promote free trade and agree common action to combat climate change.
In this context, the EU and the UK, whose leaders will meet at the Egmont palace in Brussels on 3 February, five years on from the UK’s formal departure from the EU, need each other more than ever to uphold common fundamental values. Substantive new arguments suggest the EU and the UK should start a new phase of deeper cooperation.
First, the Ukraine war and Trump’s threat that he will cut US support for NATO make the UK a prime partner for the EU. The UK is among the top nations in terms of its defence budget. It has a nuclear deterrent and one of Europe’s largest navies. It maintains a worldwide military presence and it is a permanent member of the UN Security Council. The UK has leading defence manufacturers and excellent intelligence capabilities. For all these reasons, the UK can make an essential contribution to the defence of Europe and in helping Ukraine’s reconstruction once the war is over.
Second, despite Brexit, the degree of economic integration between the EU and the UK is unmatched. More than half the UK’s imports originate from the EU and the UK is the EU’s second most important trading partner. The US represents more than 20% of the EU’s exports and almost 18% of the UK’s exports.
Both the EU and the UK face the threat of Trump’s tariffs and therefore have a heightened interest in trading more between themselves and formulating a common answer to American protectionism. For agricultural products, there would be huge benefits from aligning sanitary and phytosanitary standards and avoiding border controls. Other promising areas include trade in energy and avoiding the application of carbon border levies. The UK would of course also need to engage on EU priorities, such as fisheries.
Third, both the UK and the EU suffer from low growth: 1.4% to 1.5% annually since 2000, compared to more than 2% for the US. Deeper trade integration can help remedy this structural problem, without the need for spending large and hard-to-find amounts of public money.
Fourth, the EU still relies on London-based central counterparties (CCPs) for clearing and settlement, the backbone of capital markets. The 2008 Global Financial Crisis showed that such dependence can be risky; continental banks suddenly faced increased margin calls and lacked the liquidity to meet them. The EU has tried to reduce dependence on the UK since Brexit, but lacks alternatives. The European Commission has had to extend recognition of the equivalence of these CCPs until 30 June 2028, so that EU banks can continue hedging interest rate and exchange rate risks in London. The EU therefore needs to work closely with the UK to prevent any repeat of the turbulence of 2008.
Fifth, the EU and the UK can lead a coalition to maintain climate ambition and reinforce cooperation with large emitters in the developing world, including through climate financing. The same applies for the development of clean energy, such as wind energy in the North Sea.
These considerations suggest that it is time to leave the adversarial period of Brexit behind. The EU should reflect on whether the principles it laid out in 2017 can be modified given the new environment. The UK must maintain the EU’s confidence by correctly implementing the Withdrawal Agreement, which is the basis for further agreements. The UK should also recognise its interest lies with the EU; the ‘special relationship’ with the US, especially under Trump, is an illusion.
The 3 February leaders’ meeting is an opportunity for a new start. In an increasingly dangerous world, the EU and the UK are doomed to cooperate.