UK hoping for new trade deal with EU

Ahead of talks aimed at resetting the post-Brexit trading arrangement between the United Kingdom and the European Union, research suggests a deal could boost British exports to the bloc by 25 billion pounds ($33.2 billion) a year.

The research, carried out by financial analysts Frontier Economics, found removing trade barriers would boost the UK's GDP by 2.2 percent, The Independent newspaper reported ahead of Monday's talks.

Separate research by the National Institute for Economic and Social Research, or NIESR, shows the high price of failure, with the status quo meaning a 2.7 percent slump in exports by 2027, and a 30-billion-pound contraction in the economy.

The two pieces of research suggest a deal would be far more valuable to the UK than recent agreements with India and the United States.

Ahead of the talks, UK Prime Minister Keir Starmer said a deal would be "good for our jobs, good for our bills, and good for our borders".

Economist Jim O'Neill said: "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."

O'Neill said US tariffs are hitting the German economy hard and that Berlin will be open to a closer trading relationship with London. He predicted the talks could also lead to it being easier for the UK to sell financial services within the EU, and for UK-trained professionals to be fully accepted on the continent.

Stephen Millard, the NIESR's interim director, told The Independent the potential was huge. "In 2024, we exported 6.5 billion pounds to India, 53.5 billion pounds to the United States, and 159 billion pounds to the European Union. It is fairly clear from those numbers that a trade deal with the European Union is much more likely to shift the dial than the deals with India and the US," he said.

The BBC said experts, including Anand Menon, director of the UK in a Changing Europe think tank, believe both the UK and the EU are highly motivated to secure a closer trading relationship at the first such talks since the UK left the bloc in 2020.

"Failure to (seek success), in the current international context, would not be a good look," Menon said.

Experts expect the talks to conclude with some sort of trade deal, a joint declaration on world issues, and a security and defense pact.

The UK's European relations minister, Nick Thomas-Symonds, said on a BBC program that he also hopes for an agreement that lets UK passport holders use gates at airports for EU passengers, and changes to make it easier for young people to move between the UK and the EU.