Prime minister Sir Keir Starmer’s drive to reset EU-UK relations has suffered a setback, after Brussels reportedly turned down a proposal to create a single market for goods.
The UK is also set for a ‘Buy British’ drive from the Treasury, as chancellor Rachel Reeves pushes government departments to award contracts to UK suppliers in four critical industries.
‘Single market’ rejected
The EU has turned down a UK proposal to create a single market for goods as part of the EU-UK relationship ‘reset’, according to media reports.
The Guardian first reported the news that Cabinet Office official, Michael Ellam, had presented the idea as a way to improve economic relations.
The deal, however, was rejected by EU officials, who said they wanted to focus on a customs union or closer economic alignment.
While this has not been officially confirmed, this would appear to cross Starmer’s ‘red lines’ on rejoining the EU, single market or customs union that he set out while in opposition.
Focus is instead turning onto the areas where there has been progress already, such as on a sanitary and phytosanitary agreement.
A summit has been tentatively pencilled in for mid-July, according to the Guardian, but this date could be moved back as questions continue to swirl around the political future of Starmer and his administration.
‘Buy British’ push
Chancellor Rachel Reeves has urged her cabinet colleagues to award contracts to UK-based companies in four critical industries and has complained of many contracts been awarded to foreign companies.
In a letter seen by the Guardian, Reeves has told the cabinet to ‘Buy British’ whenever possible when delivering projects related to AI, steel, shipbuilding and energy infrastructure. She cited the need to protect the UK’s national interests.
“Every secretary of state can and must lead this agenda within their departments if we are to deliver the change the public expect,” the letter read
“Therefore, it is disappointing that we are still seeing too many government contract awards where this is not happening. We have instructed officials to take further steps to ensure your departments act in the wider national interest rather than solely focusing on narrow operational priorities.”
The Treasury will now monitor billions of pounds worth of spending to ensure that departments are taking this responsibility seriously.
Reeves also launched a cost-of-living plan over the weekend, which included a targeted food tariff cut and reduction in VAT for holidays in the Great British Summer Savings scheme.
Trump back and forth on Iran
Hopes of a peace deal ending the war in the Middle East rose and then swiftly fell over the weekend, as talks look to have stalled amid a return to war.
As late as yesterday (25 May), US President Donald Trump said on social media that negotiations were “proceeding nicely” over the weekend, with talks held between himself and various leaders of Middle Eastern countries, including Turkey, Jordan and Pakistan.
He linked the prospective deal to the Abraham Accords, signed between Israel and Saudia Arabia during his first term in office, and said it “will only be a Great Deal for all or, no Deal at all.”
A plan to re-open the Strait of Hormuz was also discussed during the talks, with a proposed ceasefire extension of 60 days and talks around de-mining the waters around the Strait.
However, the US launched new strikes against Iran this morning while Israeli prime minister Benjamin Netanyahu said that he would escalate strikes against Iranian ally Hezbollah in Lebanon.
US Central Command said that the strikes were in “self-defence” and were “to protect our troops from threats posed by Iranian forces". US secretary of state Marco Rubio said that a deal was still possible, pointing to a meeting between Iran and Qatar later today (26 May).
Reuters reported that Iran’s Islamic Revolutionary Guard Corps have said they shot down a US reaper drone that entered Iranian airspace, while supreme leader ayatollah Mojtaba Khamenei said that the US would have no safe haven in the region.
Other news
· Russia threatened more strikes on Kyiv, as Ukraine’s foreign minister urges allies not to give into “Russian blackmail” following the launch of a hypersonic missile by Russian forces
· Centrist figures in the Conservative Party have said that leaving the European Convention on Human Rights would jeopardise UK national security
· The foreign ministers of Japan, India, Australia and the US have agreed to jointly build a port in Fiji and signed a critical minerals deal
Over the weekend
· The EU and Mexico have signed a modernised version of their existing trade agreement during a summit in Mexico City
· Welwyn Hatfield MP Andrew Lewin has been named as a parliamentary private secretary at the Department for Business and Trade, while Derby South’s Baggy Shanker has joined the Ministry of Defence in a similar role
· A pair of by-elections in Ireland has raised questions about the future of Sinn Féin leader Mary Lou McDonald, after the Irish opposition party lost both Dublin Central and Galway West to rival opposition party the Social Democrats and governing party Fine Gael
