The European Union and the United Kingdom are entering a new phase in their post-Brexit relationship—one defined by geopolitical convergence but limited geoeconomic coordination.
When British Prime Minister Keir Starmer met with European Commission President Ursula von der Leyen and European Council President António Costa at Lancaster House in London in May 2025, the leaders declared the opening of a “new chapter” in relations. The summit produced a package of measures that turned the cautious talk of a “reset” into a formally endorsed “strategic partnership.” This included a roadmap for improving post-Brexit arrangements and a new Security and Defence Partnership (SDP).
Yet one strategically vital aspect was absent: economic security. The Lancaster House declaration affirmed the importance of “free, sustainable, fair, and open trade,” and the SDP promised to “explore ways to exchange views” on external aspects of economic security. But this language remains vague and devoid of concrete commitments, especially in the context of the EU’s existing partnerships in this domain.
The omission is striking. Both sides increasingly recognize the nexus between economics and security as central to their strategic planning and their economies remain deeply intertwined. The EU continues to be the UK’s largest economic partner by far, while the UK is the EU’s third-largest partner—after the United States and China, and relations with both are fraught with major challenges.
The gap thus reflects deeper structural and political factors. The UK’s decision to leave the EU’s single market excluded it from collective initiatives, while in the UK there is enduring wariness of arrangements that might resemble “shadow membership.” Ambition therefore remains limited. Nonetheless, the case for cooperation deserves reassessment.
Divergent Approaches
European Commission President Ursula von der Leyen has described economic security as a central pillar of a “new economic foreign policy,” linking internal policy instruments with a more outward-facing agenda. The EU’s 2023 Economic Security Strategy identified four key risk areas: critical supply chain dependencies, threats to infrastructure, technology leakage, and economic coercion.
The commission has since expanded its toolkit, introducing the Anti-Coercion Instrument, the Foreign Subsidies Regulation, and a strengthened investment screening regime. Coordinated export controls on dual-use technologies are also being pursued.
These ambitions face obstacles. Competences remain divided between Brussels and member states in areas such as industrial policy and export controls. Divergent national interests—especially differing attitudes to China and trade defense tools—threaten coherence. European businesses, meanwhile, often prioritize openness and resist measures that they perceive as protectionist.
The UK, having left before economic security rose on the geopolitical agenda, has been slower to adapt. The 2021 National Security and Investment Act created ministerial powers to intervene in acquisitions on security grounds. Most interventions have concerned defense, telecommunications, and energy, but the remit has gradually expanded. The UK approach is less rules-driven than the EU’s, relying heavily on executive discretion.
London has also been more cautious with trade defense measures. The EU’s imposition of duties on Chinese electric vehicles in 2024 was not followed by the UK, even though imports into the British market had surged four times faster than into the EU since 2020, as the chart shows.This underlines both policy divergence and a higher tolerance of risk on the part of the UK.
Structural differences that arise from different geoeconomic starting points compound divergent economic security cultures: For the UK, trade accounts for nearly two-thirds of its GDP, leaving it simultaneously dependent on trade for economic growth but also highly exposed to external shocks. The EU, while also highly open, has its external trade-to-GDP ratio closer to that of other advanced economies, benefitting from the scale of the single market that enhances its bargaining power and cushions external shocks.
That said, the Labour government of Prime Minister Keir Starmer has signaled a shift. Its 2025 Trade Strategy pledges to create a new trade defense instrument, reform the remedies regime, and establish a dedicated Economic Security Advisory Service. These measures suggest a firmer stance, yet tensions remain between interventionism and entrenched free-market instincts. The contrast is clear: Brussels prefers formalized, rules-driven instruments, while London prizes flexibility and agility.
Shared Defensive Interests
Despite divergent approaches, the EU and UK share overlapping vulnerabilities in a core dimension of economic security: goods trade. Product-level trade data for 2021–23 suggests that nearly 20 percent of EU imports and 15 percent of UK imports by value come from dominant suppliers. China accounts for the overwhelming majority of these dependencies: 554 products for the EU and 438 for the UK. Shared dependencies, amounting to around 7 percent of traded products, include laptops, smartphones, solar panels, and rare earths.
While some are related to low-risk consumer goods, others include strategically important areas such as high-tech industrial goods and key inputs such as commodities and chemical compounds. It is in those areas—where both sides share the same third-country vulnerability regarding the same product—that material interests in cooperating on diversification of specific product supply chains exist.
There are also mutual dependencies. The UK relies on the EU for pharmaceuticals, agri-food, industrial goods, automotive components, and chemicals. The EU is less dependent on the UK overall, but in niches such as pharmaceutical inputs and chemical compounds, British supplies are significant. Properly managed, such interdependence can be a source of resilience. Long-term contracts, coordinated standards, and shared risk management could lock in reliability and reduce vulnerability to external shocks.
Shared Offensive Interests
Defensive measures alone cannot secure competitiveness or influence. Both sides must also pursue offensive economic statecraft. Three domains stand out: shaping standards, mobilizing investment, and building coalitions.
First, technology standard-setting. The EU has positioned itself as a regulatory first mover, with initiatives such as the AI Act and Digital Services Act. The UK has gained credibility by convening international dialogues on AI safety and advancing sector-specific rules. Jointly, they could reinforce one another: Aligning approaches to AI risk management, semiconductor resilience, and digital infrastructure would strengthen Europe’s collective ability to export norms, particularly when channeled through international fora such as the G7, the OECD, or standard-setting bodies.
Second, clean technology and advanced manufacturing. Both economies face subsidized overcapacity from China in EVs, batteries, and solar panels. The EU’s countervailing duties mark a defensive step; the UK’s reluctance to follow highlights divergence. Yet both confront the same challenge: building domestic capacity while avoiding costly subsidy races. Coordinated investment frameworks, interoperable carbon-border adjustment mechanisms (with the EU’s CBAM due in 2026 and the UK’s in 2027), and joint procurement standards for clean-tech supply chains could shape demand conditions in ways that attract investment and create scale across the European market.
Third, coalition-building. With multilateralism under strain, the ability to organize plurilateral clubs has become a tool of influence. The EU has forged new partnerships with Canada and Japan and advanced the Global Gateway initiative. The UK has joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and struck digital agreements in the Indo-Pacific. Closer coordination could amplify their bargaining power in global markets and strengthen the reach of European rules.
Toward Gradual Cooperation
The task, as in many areas of EU-UK relations, is not simply to identify shared interests, but to create conditions for joint action despite mistrust, institutional asymmetry, and divergent preferences. A gradual approach is the most realistic way forward.
First, more structured dialogue. An Economic Security and Resilience Dialogue at ministerial level could allow both sides to exchange views, compare regulatory approaches, and coordinate responses to shared risks. It could begin informally and be integrated into the TCA framework later.
Second, deeper cooperation in priority areas. Energy resilience, supply chain mapping, digital infrastructure, and investment screening are promising fields. Upcoming negotiations on energy and agri-food could pilot cooperation, demonstrating practical benefits without demanding full harmonization.
Third, structured alignment where feasible. This could include coordinated responses to economic coercion, joint participation in supply-chain platforms, or alignment on critical raw material standards. The goal would not be harmonization but mutual resilience through targeted alignment, building trust step by step.
Facing Risks
The deeper the cooperation, the greater the need for alignment. For Brussels, de-risking has become a guiding principle; for London, autonomy remains prized. Each side faces political risks: The EU worries about blurring competences, while the UK fears constraining its independent trade policy.
Yet, to address shared vulnerabilities on goods trade, two political factors will be decisive. First, the UK must be willing to re-engage with elements of EU trade governance. Second, both must develop closer foreign policy alignment on the strategic challenge posed by China. These should not be rigid preconditions, but they are unavoidable for deeper, lasting cooperation.
The immediate priority is modest but significant: establish regular dialogue, pursue joint projects in overlapping areas, and build trust through concrete results. Over time, this can evolve into structured alignment. Making economic security a pillar of the EU-UK partnership would anchor the relationship in today’s global realities and give both sides a stronger hand in shaping the new geoeconomic order.
Jake Benford is Senior Expert Europe and Geopolitics at Bertelsmann Stiftung. This contribution draws on the policy brief A Missing Pillar: Economic Security in the EU-UK Partnership, co-authored with Anton Spisak.
