Setting the Agenda: An Update on UK-EU Negotiations
The first of a series of monthly updates in which UK Trade and Business Commission Expert Adviser David Henig brings updates and analysis on the evolving trade relations between the UK and EU.
Where do relations between the UK and EU stand at the end of 2024?
July’s General Election has already been consequential for UK relations with EU Member States and the institutions based in Brussels. New ministers have engaged with counterparts in a way that just hadn’t been seen since 2016, as friends and partners. This has been particularly the case for Nick Thomas-Symonds with his ministerial portfolio coordinating the extensive range of UK interests. Perhaps taking inspiration from Bob Dylan there’s a seemingly ‘never ending tour’ of engagements across Europe which has been generally well-received and hadn’t previously been seen.
Brussels had prepared for a Labour government with a plan to reward such positivity with an early 2025 summit that would cement deeper relations. While this has been agreed there was pushback from some around the EU feeling the new UK Government had not changed enough substantively, for example in dismissing an EU priority like youth mobility.
What is the next step in the UK-EU relationship reset?
Such tensions serve as a reminder that we are just at the start of the process of deepening trade relations. Thinking of the stages of such a negotiation, they would look something like:
Establish friendly relations / desire to deepen existing agreements
Define internal interests and positions
Agree overall agenda and scope of talks
Negotiate detailed substantive provisions
Conclude talks
Ratify agreement domestically
Having passed that first stage, the EU and UK are now considering in more detail their objectives, with a view to shaping a joint forward programme at the summit. This is arguably the crucial part of any international trade negotiations, when the two parties agree the scope for improvements around their objectives and red lines. For the UK, Labour’s manifesto suggested SPS, mobility for touring artists, and recognition of professional qualifications. Known EU interests include protecting their fishing rights and an EU-wide scheme for movement of young people. Much more will be added.
Indeed, with numerous potential ways to improve relations this process is likely to be iterative, and individual subjects can be at different stages of negotiation. For example, arrangements concerning Gibraltar have been in substantive talks for some time, and credible reports suggest that both the UK and EU have already agreed on the broad outline of a security deal.
What deadlines should the UK and EU be working towards?
On trade there are two particularly important deadlines. First is the start of 2026, when certain UK goods exports will be hit with extra costs under the EU Carbon Border Adjustment Mechanism (CBAM). Then there is 2028, by which time a UK Government is likely to want to wrap up new deals in time for an election. Three years is not long for a complex negotiation on details, one year even tougher. To those who would note the original Trade and Cooperation Agreement was negotiated in that timescale, this is one of the reasons for its inadequacy. There are other ongoing issues such as data, and implementation of the TCA is due for review in 2026. These are likely to be incorporated in the ongoing process.
Such international talks are rarely easy, and the current moment in UK-EU relations is particularly challenging given very different approaches. EU negotiating positions are agreed semi-publicly taking into account inputs from Member States and stakeholders, as we see on youth mobility. Meanwhile the UK since 2016 has taken a position of secrecy ahead of detailed talks, which has left the EU mostly setting the public agenda. This is starting to change, with experienced UK officials learning from past problems. UK stakeholders can help and play an important role here, for example with the UK Trade and Business Commission Blueprint of 2023 respected in Brussels as one of the best outlines of potential UK business ‘asks’.
Is the UK in a strong negotiating position with the EU?
Previous UK negotiating performance has been weak, and the EU are tough negotiators, even with friends. This can already be seen. Though the EU will almost certainly benefit more than the UK from an SPS deal given a large surplus, this is seen as a UK ‘ask’. Putting pressure on the UK Government through their core demand of a youth mobility scheme, and including maximalist asks on reduced student fees for EU students, is another example. Arguably the UK has yet to find equivalent demands, but a well-functioning EU committee in the House of Commons would both help shape the agenda, and provide negotiators with reasons to push back on the basis that ‘Parliament wouldn’t accept that’.
That said, the UK does have some strengths in the process. There are many friends of the UK in Brussels and Member States, right up to the top of the Commission, which could be crucial given they are the lead negotiators with third countries. There’s never a single EU view, and there are many sceptics, but at the very least this provides a basis to work with. Contrary to the media frenzy, a clear message from the UK Government that it will not be risking EU relations for a US trade deal has gone down well in Brussels.
Overall, progress in UK-EU relations since July has probably been to expectation, there will always be ups and downs, but time now presses and acceleration is needed. From the UK Government this means publicly moving beyond known manifesto points and starting to shape a programme of work, starting with CBAM. Talk within the UK of going further, beyond stated red lines, is unhelpful in this regard, for the UK must first overcome the damage of the previously destructive negotiating approaches. Few people in London realise just how much work will be needed on the relationship in the coming years, but at least a start has been made.
