Revealed: the £25bn-a-year prize at stake in Brexit reset

Export boost would make it easier to sell services and goods

- ALICJA HAGOPIAN DAVID MADDOX

A £25bn annual boost to British exports is at stake for Sir Keir Starmer as he tries to secure a Brexit reset deal at a crucial summit tomorrow, analysis shared with The Independent reveals.

Removing trade barriers on goods, including food and drink and electrical items, could result in a 2.2 per cent uplift in gross domestic product in the long run, boosting the economic growth the prime minister so desperately wants to deliver, financial analysts Frontier Economics found.

And a separate assessment by the National Institute for Economic and Social Research (NIESR) warns that a failure to land a deal for easier trading could lead to a 2.7 per cent drop in exports by 2027, costing the UK economy almost £30bn. The impact on the British economy from such a deal is expected to dwarf that of the agreements recently signed with India and the US.

Gordon Brown’s former economic adviser Lord Jim O’Neill summed up the importance of Sir Keir’s summit in London: “Obviously, the closer and more serious we can get, the better it is for reversing our net trade losses, and importantly, net investment from EU areas.

“Given the shock from Trump [tariffs] to Europe, especially on Germany, on top of the Ukraine shock and China slowdown, I think Germany [will be] more open to pro-UK trade issues than before. Also, I suspect the EU is going to give more than lip service to cross-border services sector reform now. Given UK net advantages in service sector exports, this is important to us.”

Such reforms could make it easier for the UK to sell services to the bloc by allowing mutual recognition of qualifications so UK professionals can practice in the EU and vice versa without having a retrain.

NIESR’s interim director, Stephen Millard, said the value of tomorrow’s deal should not be underestimated.