Liberal Democrat leader Sir Ed Davey has called for the UK to negotiate a new customs union with the European Union to boost economic growth and strengthen Britain’s position ahead of Donald Trump’s second term as U.S. president.
In a speech in London, Sir Ed emphasized that rebuilding economic ties with the EU is essential for “turbocharging” the UK economy while preparing to deal with the challenges posed by Trump’s administration. The proposed policy, he added, is a practical step toward the party’s long-term goal of rejoining the EU.
Strengthening Ties with the EU
Sir Ed argued that negotiating a fresh customs union with the EU would remove trade barriers and reduce tariffs, offering economic stability and competitiveness. While acknowledging the UK’s exit from the EU customs union in 2021, he urged ministers to begin talks with Brussels immediately, with the aim of establishing a new customs agreement by 2030.
“This is about putting Britain in the best possible position to deal with Trump from a position of strength, not weakness,” Sir Ed said.
Criticism of Trump and His Trade Policies
Sir Ed criticized Donald Trump, calling him “the first convicted criminal to take the oath of office,” and warned that his administration could threaten global peace and prosperity. Trump’s past comments, such as praising Vladimir Putin’s invasion of Ukraine and self-identifying as “tariff man,” underscore the potential challenges for international relations.
“Trump craves the pageantry of Buckingham Palace, but the UK should only offer a state visit if he commits financial and military support for Ukraine,” Sir Ed added.
He also accused Conservative leader Kemi Badenoch of planning to “beg for whatever trade deal” Trump offers and labeled Reform UK leader Nigel Farage as prioritizing Trump’s agenda over Britain’s interests.
UK Economy Needs a Boost
The call for a new customs union deal comes amid sluggish economic growth. Official figures show the UK economy grew by just 0.1% in November 2024, following contractions in September and October. Sir Ed emphasized that stronger trade relations with the EU could provide the long-term boost the UK economy needs.
Responses to the Proposal
Reform UK’s deputy leader Richard Tice dismissed the proposal, arguing that Trump is more likely to impose tariffs on the EU, making a closer relationship with Brussels counterproductive. He called the EU “an ailing economic model.”
Business Secretary Jonathan Reynolds rejected the idea as overly narrow, saying, “The Lib Dems only ever think about Europe.” He argued that the UK should focus on positioning itself between major trading blocs, including the U.S., India, and the Gulf.
A Non-Ideological Move
Sir Ed’s speech marked his first major address on EU relations since becoming leader after the 2019 general election, during which the Lib Dems suffered losses over their anti-Brexit campaign. Party sources insist the customs union proposal is a pragmatic response to global challenges, not an ideological move.
The Liberal Democrats, who gained a record 72 seats in last year’s general election, see the plan as a step toward rebuilding the UK’s economic strength in the face of Trump’s tariffs and global trade uncertainty.
