For the EU, Brexit is already working

The journey to renegotiating the trade deal will be uphill

What does the EU think about Brexit today?

Most of the time, it doesn’t.

Some of the most nearby countries (France, Ireland) will give more attention to relations with the UK than others, but this is dealt with as smaller, bilateral issues. In the main, Brexit and the functioning of UK-EU trade under our new free trade agreement (the TCA) just doesn’t make it onto the EU agenda, failing to reach into the same leagues as the war in Ukraine, migrant and refugee flows or the fight against climate change.

So when we read the latest British think tank report on how to improve the post-Brexit trade deal or hear a politician talk about what they will do to make Brexit work, we need to keep in mind that these discussions do not have an equivalent in the EU.

To the ears of some policy people in Westminster, this will sound negligent, even foolish. After all, are there not still plenty of problems coming out of Brexit? Do we not keep hearing about all the negative impacts on UK-EU trade and the challenges this is creating for business?

More and more, this is the consensus forming in Britain – that the UK’s post-Brexit economic relationship with the EU does not work and needs to be fixed. From here, it would be easy to launch into discussions with the EU on the assumption that everyone feels the same way.

Yet it would be a mistake to assume this sentiment is shared in other European capitals. If anything, the consensus is forming in the opposite direction. In its negotiation of the Brexit deal and the trade agreement, the EU successfully defended its interests, ensuring that there could be no cherry-picking of the four freedoms within the Single Market and that any frictionless trade would need to come with commitments on alignment and judicial oversight. In the the months and years since, Brexit has more or less disappeared from the agendas of political meetings and newsrooms right across Europe.

The ‘Barnier staircase’ (which set out how the closeness of the economic relationship scales with the closeness of the political one) was applied during Brexit talks and still forms the basis of the EU’s approach now. Importantly, the EU does not believe it has an interest in directing the UK towards any particular step along that staircase. If Britain’s political leadership rejects integration, then a basic free trade deal is the optimal outcome. If the UK wishes to go further, then a deeper relationship can be agreed. As far as the EU is concerned, so long as the relationship is stable, respects both sides’ red lines and is (if possible) amicable, then the EU does not need to push for more. In short, the EU sees Brexit as a solved problem.

That’s not to say that there were no costs for the EU coming from a very heavily pared down economic relationship with the UK. But it does reflect the fact that the costs of that shift were deeply asymmetric. While the UK experiences this as a significant ongoing drag on its economic performance – a continuous penalty that we are all collectively paying – for the EU it was more of a one-off adjustment, with only some specific regions experiencing moderate ongoing costs. Ultimately, for the EU these were costs that it can and has absorbed – costs that have frankly paled into insignificance next to cataclysmic events like the Russian invasion of Ukraine, sanctions and the energy crisis.

This then is the context as we head towards the 2026 assessment of the UK-EU trade deal. While the UK may think the benefits of sitting down for negotiations to rework parts of the deal are obvious, the EU is not at all sure this is the case.

Indeed, for now, the EU is actively warning away British decision-makers from seeing this as an automatic ‘review’ of the deal where every clause will be re-opened and up for change. They emphasise that there is no commitment to any kind of renegotiation and officials are at pains to point out that the main purpose is to assess how the existing trade deal has been implemented, not to start writing a new one. And implementation may not be a small matter, given the EU isn’t convinced everything is being applied as it should be.

On the EU side, it’s perfectly easy to imagine this ‘review’ being a primarily technical exercise, leading to a report that will show what the EU knew from the very start – the current trading relationship is worse than being in the EU. A downbeat conclusion, but not the kind of revelation that will prompt officials in Brussels to jump up from their seats and call for red lines to be blurred in order to give the UK a more favourable deal.

Of course, some changes will be possible. For example, you can see how easing the rules of origin on trade in electric vehicles could work for both sides (and it’s an area where car companies based in the EU have also been pushing for amendments). But there’s little doubt that we will need to make the case for any revision beforehand, demonstrating the potential benefits and arguing for how the EU could reap rewards, not simply how the UK might fix its own, self-inflicted, problems.

If the next government wishes to make incremental fixes to the UK-EU trade deal, then they will find that persuading the British electorate they have the right answers will be easier than convincing the EU that any changes are necessary in the first place.