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Keir Starmer's government has been told that forging a closer trade deal with the European Union is a "critical imperative" for British firms, as a growing number of exporters report greater difficulty to operate under the existing post-Brexit trade deal.

Mounting Exporter Frustration with Current Deal

Urging the government to hasten its EU relationship reset, the leading business group stated that the UK’s existing trade and cooperation agreement was not supporting them grow their sales in the EU. More than half of exporters in a poll of nearly one thousand firms – most of whom were SME 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, securing a successful EU reset is now a business-critical need, not a matter of political preference,” said the BCC’s director of international trade.

Highlighting an ongoing economic hit from Brexit, the business group noted this figure represented a significant rise from the proportion of unhappy firms in a comparable poll a year earlier. It added that just four out of the 946 firms 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 – coincides with growing recognition within Labour’s frontbench about the economic impact of leaving the EU. Recently, a senior Labour figure became the latest top Labour politician to advocate for closer economic ties with the EU, in remarks interpreted as a suggestion that Britain could enter into a customs arrangement.

Such an arrangement would contradict Labour’s manifesto, which promised “no going back” to the EU internal market, customs bloc, or free movement. Starmer has also stated in the past he could not foresee a situation where the UK rejoined within his lifetime.

However, several pro-European ministers are thought to be part of a group who would like to see the government go further.

Business Proposals for the EU Negotiations

In a report setting out a “corporate blueprint 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 zero effect in recovering any sales into the EU,” said one small manufacturing firm in the North West.

The BCC outlined several main recommendations for talks with Brussels in 2026, including:

• A deal to cut border checks on animal and plant products.
• Finalising linkages between the UK and EU’s carbon markets.
• Establishing a scheme for young people to work and travel.
• Securing full UK participation in the EU’s defence fund.
• Enhancing cooperation on tax and border simplification.

A government spokesperson said: “This government is removing red tape and trade barriers to support jobs, business, and growth. That’s exactly why we renewed our partnership with the EU and are making significant headway in negotiations.”