Reeves Pushes for Closer EU Economic Ties on Brussels Visit

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(Bloomberg) — UK Chancellor of the Exchequer Rachel Reeves said she wants closer economic ties with the European Union as she met with European finance ministers in Brussels as part of an ongoing ‘reset’ of relations with the bloc.

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“It is in our national interest to have more normal trading relations with our nearest neighbors and trading partners,” Reeves told reporters at the European Council building on Monday. “As we reset our relations, it is with the purpose of growing our economy and improving living standards.”

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Mending ties with the EU is one of the key features of British premier Keir Starmer’s foreign policy, after the former Tory administration took Britain out of the bloc and oversaw a post-Brexit decline in trade. The EU continues to be the UK’s largest trading partner, but firms have faced extra cross-border red tape and bureaucracy since the divorce.

The relationship could assume even greater importance for Starmer given the incoming presidency of Donald Trump in the US and the prospect of tariff wars that could hurt trade. Though Starmer has tried to argue the UK won’t be forced into taking sides, Trump’s victory has complicated matters.

Still, Starmer’s new Labour government has ruled out the most growth-enhancing options concerning relations with the EU — including re-joining the bloc’s single market or customs union — and instead talks about closer cooperation on issues such as security and energy.

Irish Finance Minister Jack Chambers said Reeves’ appearance in Brussels was “an important day in terms of the wider reset of EU-UK relations” and “turning a new leaf.” Germany’s finance minister, Joerg Kukies, said it was a “good signal” that there was this new dialog with the UK, but that the British government had also made commitments to its electorate that it wasn’t for Germany to question, referring to its positions on the single market and customs union.

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“Of course any progress would be highly welcome, but we completely understand that the UK population has taken a different decision,” he said after meeting with Reeves.

Concerning potential cooperation with the EU, Reeves has previously mooted a veterinary agreement that might reduce some customs burdens for food and drink traders, and mutual recognition of professional qualifications which would help services firms.

“UK firms wanting to trade with Europe are struggling under huge regulatory and paperwork burdens,” said Shevaun Haviland, director general of the British Chambers of Commerce. “A better deal can’t come soon enough.”

—With assistance from Alessandra Migliaccio.

(Adds Reeves, Kukies, Chambers comments, starting in second paragraph.)

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