Key Takeaways:
- The UK Labour party is not planning to rejoin the EU’s customs union, despite comments from Deputy Prime Minister David Lammy suggesting it could boost the economy.
- Lammy highlighted Turkey’s customs union with the EU as a potential model for the UK, but the arrangement has its limitations, including curtailed independence in trade policy.
- The Labour party is instead seeking to forge closer economic ties with the EU through side-deals on issues like food standards and carbon pricing.
- The Liberal Democrats are pushing for a new customs union deal with the EU and are calling on Labour to support them.
- The issue of a customs union has reappeared on the political agenda, with the UK’s economic growth being a top priority for the government.
Introduction to the Debate
The debate over the UK’s relationship with the EU’s customs union has reignited, with Deputy Prime Minister David Lammy suggesting that rejoining the union could boost the economy. However, Labour leader Sir Keir Starmer has reiterated that the party is not planning to rejoin the customs union, despite Lammy’s comments. The issue has been a point of contention since the UK’s withdrawal from the EU, with different parties having different views on the best way to maintain economic ties with the bloc.
The Turkish Model
Lammy’s comments on the Turkish model of a customs union with the EU have sparked interest, as it is seen as a potential way to reduce trade friction and boost economic growth. Turkey’s deal with the EU reduces the need to prove the origin of many goods traded between the two, which has been a significant source of friction for the UK since Brexit. However, the arrangement also curtails Turkey’s ability to pursue an independent trade policy, which was a key promise made by Brexiters. The Turkish model has been suggested as a more realistic option for bolstering ties than rejoining the EU’s customs union itself, but it remains to be seen whether it would be feasible for the UK.
Labour’s Position
Sir Keir Starmer has made it clear that the Labour party’s position on the customs union remains unchanged, despite Lammy’s comments. The party’s election manifesto ruled out taking the UK back into the EU’s customs union, and instead, the government is seeking to forge closer economic ties through a series of side-deals covering issues like food standards, visas for young people, carbon pricing, and electricity trading. Starmer claims that the UK’s relationship with Europe has been "totally reset" since Labour entered office last year, and the party is focused on rebuilding ties while sticking to its red lines.
Liberal Democrat Pressure
The Liberal Democrats are pushing for a new customs union deal with the EU and are calling on Labour to support them. The party’s Europe spokesperson, Al Pinkerton, said that "the penny is dropping that a customs union is the best way to fix the economic problems plaguing Britain" and called on Lammy to "vote with us" on the issue. The Liberal Democrats are hoping to force a vote on the customs union issue next week, which could put pressure on Labour to reconsider its position.
Economic Growth
The issue of economic growth is a top priority for the UK government, and the debate over the customs union is closely tied to this goal. The UK’s economic growth has been sluggish since Brexit, and many argue that rejoining the customs union or forging closer ties with the EU could help to boost growth. However, others argue that the UK’s independence from the EU allows it to pursue its own trade policy and negotiate deals with other countries, which could also lead to economic growth. The government’s trade and tariff reduction deals with India and the US, made possible by Brexit, are seen as examples of this.
Conclusion
The debate over the UK’s relationship with the EU’s customs union is complex and multifaceted, with different parties having different views on the best way to maintain economic ties with the bloc. While the Labour party is not planning to rejoin the customs union, the issue remains on the political agenda, and the Liberal Democrats are pushing for a new deal. The UK’s economic growth is a top priority, and the government will need to navigate the complexities of the customs union debate to achieve its goals. Ultimately, the outcome of this debate will have significant implications for the UK’s economic future and its relationship with the EU.