Starmer's Euro Vision - New UK-EU trade deal gets douze points for diplomacy, but less for growth
19 May 2025, 15:46
Today’s agreement between the UK and EU on sanitary and phytosanitary (SPS) measures and emissions trading (ETS) cooperation is undoubtedly welcome.
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It signals a shift away from years of fractious and pointless divergence towards something more pragmatic, even constructive.
But while this deal may ease tensions and smooth select trade flows, it’s no game-changer for the UK economy. Not yet.
Both the SPS and ETS agreements tackle specific barriers that have complicated trade since Brexit: delays and costs on agri-food products, and the fractured carbon pricing system.
These are technical but important wins. They reduce friction. They lower some costs. They are a step forward.
But they will not deliver the economic growth the government says it wants. You do not turbocharge an economy by unblocking some tomatoes and reconciling carbon credits.
The heavy lifting lies elsewhere and the government knows it.
The UK’s GDP growth remains sluggish, even when compared to our European neighbours. That’s not a coincidence, it's a consequence of having deliberately walked away from frictionless trade with our biggest market.
Only by aligning more closely on goods, and specifically by tackling the technical barriers to trade that still persist, can the UK begin to recapture the kind of predictable, scalable export environment that supports real economic expansion.
What’s telling is that the Chancellor, Rachel Reeves, has sounded markedly more enthusiastic about deepening trade ties than the Prime Minister.
While Starmer has kept his language cautious, Reeves has repeatedly emphasised the need for supply-side reform and trade stability. And rightly so, she’s the one holding the growth brief, and she knows that marginal fixes won’t move the needle.
It is time for the UK to be honest about what growth really requires - a common-sense deal.
This isn’t about rejoining the single market or customs union, it's about aligning strategically where it makes economic sense.
Regulatory divergence for the sake of “sovereignty” has proven expensive, bureaucratic, and deeply unattractive to investors.
Two days after Eurovision, it’s douze points for diplomacy, but a good deal less for growth.
Today’s deal is the start of a journey, but isn’t the destination.
For the PM to be remembered for growing the economy, he will need to go further, faster, and with more ambition, to achieve the growth he’s promised the voters.
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Naomi Smith is the CEO of Best for Britain
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