Rachel Reeves’ Eurogroup meeting is a positive step towards a UK-EU ‘reset’

Editorial: The scenes from Brussels today will no doubt be a welcome and encouraging sign for those who yearn for a realignment of UK-EU relations. But there’s work to be done in order for us to truly move past the fallout from Brexit

Rachel Reeves has become the first chancellor of the Exchequer to attend a meeting of the “Eurogroup”, an informal body of finance ministers from the EU member states that use the euro.

The optics could hardly be more encouraging for those who yearn for an end to Britain’s schism with Europe. A British minister of such seniority discussing the common, high-level problems facing Europe, and indeed the West, being listened to with respect by her counterparts – and loosely coordinating policy where appropriate – is a tantalising glimpse into a possible future, as well as a poignant reminder of all that was lost by Brexit. It gives hope, in other words, of a more radical “change” than yet envisaged in the UK’s relationship with the European Union.

Ms Reeves surely also found common ground with the others around the table about their shared challenges. The UK’s concerns are very much the EU’s priorities, too: the war in Ukraine; championing free trade as a driver of economic competitiveness; and strengthening bilateral economic partnerships.

If it’s not too rude or cliched to style him thus, all those present in Brussels will also be aware of the “elephant in the room”, Donald Trump – and his threats to impose punitive tariffs on America’s trading partners, with the UK potentially as badly exposed as any other European economy.

A common understanding, if not front, in the face of the new wave of protectionism would also benefit all the European powers. Sir Keir Starmer recently remarked that it will not be necessary for the UK to choose between America and Europe – but he may find that Brussels and Washington will end up forcing him to make some uncomfortable choices about trade policies. Brexit could well leave the UK with the worst of all worlds in a future US-EU trade war, losing ground in its two largest export markets by far.

Yet, as uplifting and symbolic as the eurozone event with Ms Reeves is, the reality is that it is a little bit of a charade. The UK is no longer a member of the EU customs union or the single market, as the country knows to its great cost – let alone a member of the eurozone.

Ms Reeves is a welcome and constructive participant at these kinds of meetings but the UK is, in the final analysis, a mere passive observer to any decisions taken. There may be influence but there is no power.

More depressingly, still, there remains some doubt about just how much difference the Labour government’s much-vaunted ambition to “reset” EU-UK relations will make in practice. The term “reset” in the context of Europe appears eight times in the official British briefing notes on the meeting, just as it has in hundreds of other ministerial statements and speeches, yet precisely what the “reset” entails remains opaque.

Sir Keir Starmer and his colleagues have made no secret that they regard the Brexit deal negotiated by Boris Johnson as flawed, and that they wish to renegotiate it – but there is little sign of what the outlines of a new settlement might look like.

We do know that the Starmer administration has long ruled out rejoining the single market or customs union, that it wants to conclude a defence and security treaty (which was part of the original British proposals back in Theresa May’s time) and relax trade barriers, especially phytosanitary and veterinary checks. Further adjustments in relation to Northern Ireland and the Windsor Framework would also be welcome, as would mutual recognition of professional qualifications, at a minimum.

Yet, as the British discovered after the 2016 Brexit referendum, it takes two to tango around a treaty – and the EU is not going to allow the British to indulge their favourite hobby of cherry-picking the more attractive benefits of European integration with nothing offered in return.

Despite a deep regret about Brexit, most recently graphically described by former German chancellor Angela Merkel in her memoir, the EU has no desire to open up the Brexit talks, beyond the technical, administrative review scheduled for next year. The British want lower trade barriers? “Very well,” is the response in European capitals. “What does Europe get in return?”

The fishing quotas are due to be revisited, and the French and Spanish would appreciate more concessions in British waters. Most EU member states would also like to see more freedom of movement for young people across the UK and EU, but Brussels would also certainly value a defence and security treaty in the context of an uncertain American commitment to Nato, and continuing Russian attempts to rebuild the eastern European empire built by the tsars and expanded by Joseph Stalin.

The trade-offs are clear, and widening the agenda to add a defence and security dimension should also give negotiators on both sides more to play with in any future talks. Yet the great Brexit “reset” remains uncertain, and there must be some doubt that it will prove as thoroughgoing or rapid as to boost UK economic growth to anything like the extent necessary to break out of its current torpor.

The British government is constrained by manifesto commitments – but also an increasingly unjustified nervousness about public opinion, which displays regrets about Brexit.

In any case, if the Brexit reset is to succeed, Ms Reeves will find herself a more constant presence in the conference rooms of Europe in the near future.