Why should the EU and the UK reinforce their cooperation on trade?
A reset in the relationship between the United Kingdom and the European Union is underway, with an agreement that leaders will meet in an EU-UK Summit in the first half of 2025. At this summit, trade should be a priority agenda point. Almost half of the UK’s trade is with the EU, and the UK is the EU’s second largest trading partner for trade in goods and services combined. The economic case for a reinforced trade relationship is therefore very strong.
The current geostrategic situation makes the case even stronger. The US tariff threat and Chinese overcapacity calls for close cooperation between the top officials on both sides. Regular ministerial dialogue would help in promoting internationally a joint approach to economic security that maintains support for rule-based trade and World Trade Organisation reform. In the face of climate setbacks, both sides should also aim to lead in promoting cooperation on carbon pricing and international discussions on trade and climate.
Part of the EU-UK reset could be agreements that complement the Trade and Cooperation Agreement, which currently governs the relationship. Priorities should be a veterinary agreement, an agreement on carbon pricing and a youth mobility and cultural facilitation agreement (together with reinforced services commitments).
More importantly, the reset in trade relations should also be an opportunity to reinforce regulatory cooperation. There are many areas in which the UK has an interest in keeping its regulatory regime aligned with the EU. But the EU should also be ready to enter regulatory dialogues with the UK in areas where it is undertaking major new regulatory initiatives, such as European Green Deal legislation and artificial intelligence.
By the time of the 2025 EU-UK Summit it will be important for both sides to agree on the strategic case for reinforced trade cooperation and to prepare the ground for trade negotiations, which could be completed no later than 2026.
Read the Policy brief 'A trade policy framework for the European Union-United Kingdom reset' by Ignacio Garcia Bercero.
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