What's Driving the Prime Minister's Significant Change on Stronger Relations to the EU?

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The Premier's particularly significant tilt on the United Kingdom's after-Brexit connections to the EU this weekend was intended to signal to industry, to Brussels, and to European partners, in addition to his own backbenchers.

An Altered Process for Dialogue

Tighter after-Brexit trade links are projected to be looked at as within an regular schedule of direct negotiations rather than solely at this year's structured evaluation of the UK-EU deal.

This represented the stated position to growing calls regarding a wider-ranging Brexit reset that suggested rejoining the EU customs bloc.

Political Calls

Several MPs, trade union officials and cabinet ministers have added their voices to ideas highlighted by legislative actions last year that culminated in a symbolic resolution.

"We are better looking to the European single market rather than the customs union for our closer integration," the Prime Minister remarked.

He stated unequivocally that re-entering the tariff union was a lower priority, as it conflicts with what he considers a major accomplishment of the previous year: the conclusion of high-quality agreements with the United States and India, with more to come in the Middle East.

Focusing On the Single Market

Instead of the customs union, his primary aim is on developing a "more integrated partnership" with the EU's single market, which would avoid tearing up those international pacts with other nations.

When the UK completed its departure from the EU in the start of 2021, the agreement at the time emphasised liberation from EU standards over seamless commerce for British exporters across Europe.

The current reset proposes synchronising with EU standards in several sectors to help the easier passage of trade: food and farm exports, power, and emissions trading.

Commercial Calls

A leading commercial body last month issued a comprehensive series of new proposals in different fields to aid exporters deal with post-Brexit red tape that has hampered the goods trade.

Its member poll reported that a majority of business members agreed that the existing agreement was failing to support sales growth.

A number of other areas could, feasibly, see a similar approach – harmonisation with EU regulations – in return for lowering post-exit friction across industry, in vehicles, industrial chemicals, or for example in value-added tax systems.

Continental Response

European capitals were disappointed by the lack of ambition in the previous recalibration, notably the London's refusal of suggestions floated by some commentators regarding the virtual readmission of UK products to the single market.

The precise arrangements on power sharing and food and farm standards is remains to be finalised. A proposal for UK manufacturers to be participate in a €150bn security initiative has stalled over the scale of the contribution, after opposition from France. a non-EU country has joined the programme.

Geopolitical Context

The UK has reached an agreement to rejoin a university exchange programme and to continue talks on a youth jobs scheme. This has paved the way for subsequent negotiations.

Some UK insiders suggest that the release last month of a key US strategy document has altered the backdrop on UK European policy.

The strategy stated that the US would "encourage pushback" to continental trends and praised the "growing influence" of nationalist groups.

Among officials, there is an acknowledgement that the global landscape has changed again.

Home Calculations

At home, the governing party also expects being pressured on EU relations by one political rival, but also a further party, which is targeting its traditional heartlands in upcoming council elections.

The Prime Minister's weekend remarks are borne of a confluence of economics, domestic pressures and global dynamics as the UK enters a year that will see the 10th anniversary of the decision to leave the European Union.

Gary Grimes
Gary Grimes

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