Logistics UK: Businesses must shape the future UK-EU relationship to boost Europe’s economy

Ahead of the UK-EU Summit on 20 November, business group Logistics UK is calling for policymakers and businesses across Europe to come together and develop practical solutions to strengthen the UK-EU relationship, to boost competitiveness, growth and resilience across the continent.

“Economies grow when they trade and proximity is still one of the most significant factors,” comments Fletcher. “The trading relationship between our two economies is strong: the EU accounts for around 40% of UK exports while in 2024, the UK was the EU’s second-biggest trading partner. However, this trade is happening despite, not because of, post-Brexit arrangements so it is essential the upcoming UK-EU Summit begins to fix the frictions that are stifling trade-led growth for both economies.”

As UK ministers and EU officials prepare for the summit, Logistics UK Chief Executive Ben Fletcher is holding a series of meetings in Brussels with businesses and diplomats today, (10 November) to discuss how closer cooperation can create a trading environment that allows both economies to be more competitive, to grow and to become more resilient. A key element of the programme, given Ireland’s current presidency of the Council of the EU and the importance of the UK-Ireland trading relationship, is a joint event with Ibec, Ireland’s premier business group. The event, Europe’s Competitiveness: Fixing the Frictions Holding Back Trade-led Growth will explore ways to reduce trade barriers and regulatory friction that impede trade-led growth and efficient supply chains.

Logistics UK analysis shows a lack of alignment with key trading partners, including frictions resulting from Brexit, have held back the UK economy by an estimated £12 billion which is equivalent to around £400 per household in extra economic output. In addition, analysis by independent transport economists MDS Transmodal for Logistics UK, shows in the ten years since the Brexit referendum in 2016, UK exports to the EU (by volume) have fallen by 15.9%.

“Reducing barriers with markets further afield can deliver important benefits but cannot replace the trade lost through increased friction with the EU,” continues Fletcher. “The logistics sector is critical to Europe’s competitiveness and resilience, so logistics businesses must be at the heart of efforts to bring the UK and EU closer together – ensuring that the focus is on practical trade-boosting measures, including removing costly border checks for meat and dairy products, reducing restrictions that limit the number of days HGV drivers and other logistics workers can spend in the EU, and addressing slow digital border processes.”

New research from Capital Economics highlights the investment benefits of a strong European logistics sector, with modelling indicating that a one percentage point increase in logistics’ share of the economy is associated with a one percentage point increase in foreign direct investment (FDI) as a share of GDP, underlining the close relationship between efficient logistics and investment attractiveness.

“International companies invest in countries where goods move efficiently,” continues Fletcher. “Investors know that reliable supply chains with good transport networks, warehousing capacity, ports and airports all reduce costs, increase profits and expand market access. To get growth going across Europe, it is essential that logistics businesses across the UK and EU can boost trade and have the capacity, resilience and infrastructure needed to drive growth and attract investment.”

Business group Logistics UK champions the logistics sector, the backbone of the UK economy and global trade, providing a unique, authoritative voice for its members. As the only trade association representing the whole industry, it supports more than 22,000 members, operating in road, rail, waterways, sea and air freight, in ports, airports and warehousing, as well as the customers of freight services such as retailers and manufacturers. The group delivers industry representation, services and thought leadership to support a sector that is critical to economic growth, employing 8% of the UK workforce, contributing £175 billion in annual GVA and enabling over £1 trillion of international trade. For more information about the organisation and its work, please visit logistics.org.uk