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Analysis-Ten years on, Brexit disputes still hold back Britain's reconciliation with EU

Published by Global Banking & Finance Review

Posted on June 22, 2026

6 min read

· Last updated: June 22, 2026

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Ten Years After Brexit: Ongoing Disputes Slow UK-EU Reconciliation

Assessing the State of UK-EU Relations a Decade After the Referendum

By Kate Holton and Elizabeth Pineau

LONDON/PARIS, June 22 (Reuters) - Ten years on from Britain's shock vote to leave the European Union, much of the rancour and vitriol between London and Brussels has gone. But the tensions that drove the historic rupture - over immigration and ideology - remain. 

Compounding that, the sides are now limited in how far they can go in rebuilding ties due to the advance of populist and far-right parties in Britain, France and Germany, despite the much more volatile world that confronts them today.

Britain finally left the world's biggest trading bloc an hour before midnight on December 31, 2020, bringing to an end an often turbulent 47-year membership.

Since then, Britain's economy is widely accepted to have been damaged, it is in the grip of the highest prime ministerial turnover in nearly two centuries and the few gains from Brexit - from bespoke trade deals to regulatory independence over financial services and artificial intelligence - are not felt by many.

Michel Barnier, the EU's negotiator on the Brexit deal and a former French prime minister, told Reuters that not all of Britain's challenges were due to it leaving the EU.

But he added: "I think that each and every difficulty in the UK is more serious because of Brexit."

Those politicians and campaigners who led the drive to leave the bloc say it has been a success. 

Matthew Elliott, the chief executive of the official Vote Leave campaign group, said independence was more important as the world turned more hostile, with the U.S. more unpredictable, China more challenging and Russia at war in Europe. 

"In a world which is rapidly changing, it's useful actually to have your independence so you can have the right deals for your country and do the right alliance at any one time," he said. 

Gradual Improvements in Ties

Efforts to improve ties between Britain and Brussels began under former Prime Minister Rishi Sunak in 2022 and were stepped up once the more pro-EU Labour government of Keir Starmer was elected in 2024, helping to rebuild trust.

But the tangible benefits have been limited.  

Starmer hailed a "new era" in Britain's relationship with the EU in May last year when they agreed a deal that allowed London to negotiate access for its large defence sector to join a €150 billion ($173 billion) fund to rearm Europe.

Along with Britain agreeing to align with EU rules to ease the trade of food and farm goods, electricity and emissions, they were also trying to agree a reciprocal youth visa scheme. 

Charles Grant, head of the Centre for European Reform (CER) think tank in London, said progress had been "slow and painful", reflecting the broader mistrust that still exists. 

And Britain did not join the SAFE defence scheme, following opposition from France, an outcome that deeply angered Britain and its allies in the bloc, such as Poland. 

Defence and National Security Challenges

"Defense and national security is the axis around which we very rarely disagree," Kevin Craven, the head of the British defence lobby ADS Group, said. "So united on Ukraine, united on the Russian threat, but disunited on the means to combat that threat is a really unhelpful situation."

Where Could the Relationship Go?

The Brexit anniversary has turned the focus to what type of relationship Britain and the EU could eventually settle on, whether London would want to join the EU's single market or customs union, or seek to rejoin the bloc in full one day.

Potential Models for Future Cooperation

Political analysts have suggested that the EU's patchwork of agreements with Switzerland could be a model as it has the potential to provide a level of EU market access while giving the government some control over who could move to Britain.

The CER's Grant said officials in Brussels were currently hostile to the idea, although that could change over time if geopolitical challenges mount. 

Political Barriers on Both Sides

But Grant said Brussels would be hamstrung by Marine Le Pen's National Rally in France and Germany's AfD who could demand their own opt outs if they ever got into power. At the same time, in Britain the veteran Brexit campaigner Nigel Farage has led opinion polls for more than a year and has threatened to tear up any closer agreement.

UK Support for EU Membership Is Not Guaranteed

Opinion polls show that a majority of people in Britain regret leaving the EU and want to rejoin the bloc. But a YouGov poll this month showed that support fell away once people were asked about the possible implications or costs of rejoining, particularly around immigration and the future of the pound.

Labour’s Cautious Approach to EU Relations

That could constrain those Labour figures who hope to replace Starmer as prime minister, such as leading rival Andy Burnham, from making bolder promises on Britain's relationship with the EU. 

Challenges in Rebuilding Trust

France's Barnier said Brexit was a "lose-lose" for both sides and bemoaned the loss of a heavyweight member state that could lead on diplomacy, defence and trade. He said the two sides needed to rebuild ties based on the conditions in the world now, not 10 years ago: "Because of Mr. Trump on one side, because of Mr. Putin on the other side, because of the Chinese."

But the same tensions that existed throughout Britain's membership exist today. Even pro-EU British officials see it as an inflexible, legalistic bureaucracy while their EU counterparts will not forget the sight of Farage haranguing and insulting EU politicians during his 20 years in Brussels. 

A senior Labour lawmaker said the government was trying to pass legislation which would give ministers the power to implement or align with EU rules, helping to hold the two sides together.

But the lawmaker said the government needed some "wins" from Brussels, starting at a joint summit in July: "No more messing around," they said. "(We need) some things that we could sell, t

Key Takeaways

  • Brexit has cost the UK between 6–8% of per‑capita GDP by 2025, along with 12–18% lower investment and 3–4% reduced employment and productivity (nber.org)
  • UK equity markets underperform US and continental peers (e.g. FTSE 100 up ~62% vs. DAX +151%, Euro STOXX +109%), with £ weakening ~10–12% (euronews.com)
  • High political instability—six prime ministers since 2016—undermines continuity; defence ties including participation in the EU’s SAFE fund remain unresolved (europeans.today)

References

Frequently Asked Questions

What core tensions still affect UK-EU relations post-Brexit?
Immigration and ideological differences continue to drive underlying tensions between Britain and the EU, limiting progress in rebuilding ties.
How has Brexit impacted the UK economy?
The UK economy is widely accepted to have been harmed by Brexit, with few tangible gains seen by the general public.
What steps have been taken to improve UK-EU relations since Brexit?
Efforts include deals on defense cooperation and smoothing trade of goods, but progress remains slow and mistrust persists.
Could Britain rejoin the EU or its single market?
Analysts suggest models such as Switzerland's agreements might be discussed, but political and geopolitical challenges remain.
How does the rise of populist parties affect UK-EU reconciliation?
The advance of populist and far-right parties in Britain, France, and Germany limits how far the UK and EU can improve their relationship.

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