The London Pulse News — Liberal Democrat leader Sir Ed Davey has called on Prime Minister Sir Keir Starmer to “fire the starting gun” on creating a new UK-EU customs union during his upcoming meeting with European leaders in Brussels. The meeting, scheduled for Monday, marks the first time a British prime minister has been invited to such a gathering since the UK left the EU in 2020.
Sir Ed described the move as a “no-brainer,” arguing that a new customs union would provide a significant boost to the UK economy and strengthen the country’s position in negotiations with global partners, including US President Donald Trump. However, Sir Keir has repeatedly ruled out rejoining the EU customs union or single market, calling it a “red line” for his government.
Despite this, Labour has left the door open to joining the Pan-Euro-Mediterranean (PEM) convention, a trade agreement that allows tariff-free movement of certain goods across dozens of countries in Europe, North Africa, and the Middle East. The Lib Dems see this as a potential “first step” toward a broader UK-EU customs union, which would enable tariff-free trade with EU member states but restrict the UK’s ability to strike independent trade deals.
A Push for Economic Growth
In a letter to Chancellor Rachel Reeves, Sir Ed urged the government to commission the Office for Budget Responsibility (OBR) to assess the economic impact of a new customs deal with the EU. He called for the findings to be published alongside the OBR’s Spring Statement on 26 March.
“The chancellor is tying herself in knots trying to think up new ways to grow our economy,” Sir Ed said. “But there’s a solution right under her nose: a new UK-EU customs union deal that boosts trade for British businesses and raises vital tax revenue for our public services.”
The Lib Dems’ ultimate goal is for the UK to rejoin the European Union, though the party has only recently begun campaigning on the issue following the general election.
EU Open to Post-Brexit “Reset”
Earlier this month, EU trade chief Maros Sefcovic expressed openness to the UK joining the PEM convention as part of a broader effort to reset relations post-Brexit. Downing Street, however, has emphasized that any agreement must align with the government’s “red lines,” including no return to the single market, no freedom of movement, and no rejoining the EU customs union.
A spokesperson for the prime minister stated: “We’ve always said that we want to look at ways to reduce barriers to trade whilst remaining within our clear red lines. The arrangement being discussed is not a customs union.”
Conservative Opposition
The Conservatives have criticized the proposal, accusing the government of attempting to “reopen the divisions of the past” and edge the UK back into the EU. Tory leader Kemi Badenoch challenged Sir Keir to meet five tests to ensure he does not “undo Brexit,” including:
- No “backsliding” on free movement of people.
- No compulsory transfer of asylum seekers to the EU.
- No new payments to the EU.
- No reduction in fishing rights.
- Ensuring NATO’s primacy in European security.
Badenoch argued that joining the PEM convention would turn the UK into “rule-takers, not rule-makers,” undermining the sovereignty regained through Brexit.
A Fragile Balancing Act
Sir Keir’s meeting with EU leaders is expected to focus primarily on defence and security cooperation, reflecting the UK’s ongoing commitment to European stability amid global challenges. However, the broader question of trade and economic ties remains a contentious issue, with the Lib Dems pushing for closer alignment and the Conservatives warning against any dilution of Brexit’s achievements.
As the government navigates this complex landscape, the debate over the UK’s future relationship with the EU is likely to intensify. For now, Sir Keir appears determined to maintain his “red lines” while exploring pragmatic ways to strengthen trade and cooperation with European partners.
The London Pulse News will continue to provide updates and analysis on this evolving story as the UK charts its post-Brexit course.
