Global Macro Research
PoliticsWhat would Labour do? 3. EU relations
A potential future Labour government would attempt to develop closer relations with the EU and remove barriers to trade. But there are limits to this approach, with membership of the single market remaining off the table.
Author
Lizzy Galbraith
Senior Political Economist

Duration: 1 Min
Date: Aug 08, 2023
Key Takeaways
- Improving relations with the EU will be a foreign policypriority for Labour. The Party believes that reducing UK-EU barriers to trade and cooperation is essential to meet the UK’s economic and security needs.
- Labour is politically in a position to seek greaterchanges to the UK’s relationship with the EU than the Conservatives. As such, it will see the review of the Trade and Cooperation Agreement (TCA) as a major opportunity to reset relations.
- Other key parts of Labour’s strategy include reducing - trade barriers by increasing regulatory alignment with - the EU, as well as seeking to regain mutual recognition - of professional qualifications. 
- But there are limits to this approach. Labour has been - clear it will not seek full alignment with EU standards. - And Starmer has committed to remaining outside of - the single market and customs union, while Labour - would not return to any arrangement involving freedom - of movement. 
- A key unknown in Labour’s strategy is the EU’s - response. So far, the EU has been very keen for the - UK to ‘own’ Brexit and the terms of the TCA agreed - under Boris Johnson. A major reset of relations would - be the necessary precursor to a meaningful review of - the TCA. There are significant risks that Labour will fall - short in its aims for a UK-EU reset if the two sides - remain far apart on their negotiating positions. 



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