UK-EU trade has ‘flatlined’ but hopes for ‘reset’, MPs told

UK trade with the European Union (EU) has “essentially flatlined”, MPs were told, but the new government hopes to “reset our relationship” with the neighbouring bloc.

Business minister Douglas Alexander told the House of Commons: “Overall trade since 2018 has essentially flatlined.

“As a government, we’re determined to reset our relationship with the EU more broadly, but within that broader objective, looking specifically at the border to try and achieve less ‘frictionful’ trade.”

He later vowed: “As part of that broader resetting of our relationship with the EU, we are determined to tackle barriers to trade… including through the negotiation of a UK-EU veterinary agreement to help reduce unnecessary border checks.”

Labour’s Helen Hayes, MP for Dulwich and West Norwood, called on the business department to take an “evidence-based approach” to the UK’s trade with the EU and “take all possible measures to remove the barriers to trade that are holding our country back”.

She stressed that goods exports to the EU are “still 11 per cent lower than they were in 2019” before the Brexit agreement took effect.

Alexander replied: “While there has been better performance on services than on goods, she’s absolutely right to recognise the fall that we’ve seen in goods trade with the EU.”

It came as business and trade secretary Jonathan Reynold argued that the new Labour government was in a better position to improve UK-EU ties than the previous administration.

“To be frank, the thing we bring is that we are unencumbered by some of the politics, the internal politics of the last government towards that, and at the same time, we believe we can make the most of those opportunities around the world,” he suggested.

“Under this government, we’ll match our domestic, economic and business priorities. We will be able to reset our relationship with the European Union.”

Alexander also told MPs the department was “very carefully reviewing” the trade negotiating mandates it inherited from the previous Tory government.

Shadow business minister Mike Wood asked for details on when the government will publish its negotiating objectives ahead of talks with the European Union.

He replied: “Clearly we inherited a number of open negotiating mandates from the previous government, not least in relation, for example, to the Gulf Cooperation Council and to India.

“We are very carefully reviewing those mandates… but we’ve been clear already that as well as resetting the relationship with the EU, we are keen to essentially pursue a twin-track strategy, whereby we’ll take forward work in relation to those FTAs (free trade agreements).”