Ten years on from the Brexit referendum, is Trump pushing the UK back into the arms of the EU? British economist Philippe Legrain explains the shifting sands in the UK's relationship with the EU.

Thx to @anandmenon.bsky.social @mijrahman.bsky.social Fabian Zuleeg for their time and expertise

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§ Biggest catalyst for change could be an even greater sense of common threat – eg, if #Trump quits #NATO.

But so far there hasn’t been a strategic discussion on how to protect liberal democracy from the forces trying to destroy it, & how the EU-UK relationship fits into that.

§ The EU’s position may also evolve. Offering Ukraine a form of associate membership sets a precedent.

Given Trump’s rupture of global order & Western alliance, EU wants to cooperate more closely with eg Canada, which could prompt fresh thinking about institutional flexibility.

What might break this deadlock?

§ A pro-EU shift in the UK. Starmer’s weakness is pushing him towards closer single market alignment, while his leadership rivals favour a customs union.

But given Labour’s red lines, any big shift would likely only come if it wins a 2nd term.

§ UK hemmed in by Labour’s election-manifesto red lines: no return to the single market, customs union or freedom of movement;

§ UK still wants to have its cake and eat it eg participate in single market without making budget contributions;

§ UK reluctant to choose EU over US.

Hurdles include:

§ EU is broadly satisfied with its existing deal with the UK, and has more pressing priorities than trying to deepen their economic ties;

§ EU is reluctant to give the UK special treatment (“no cherry picking”), though it's being more flexible in a few areas;

But then Trump & Putin had other ideas.

Now, 10 years after the referendum, is Trump pushing UK back into the EU's arms?

Relations have certainly improved, as has security cooperation.

But progress on economic cooperation remains meagre, cos of practical & political hurdles.

Ten years on from the Brexit referendum, is Trump pushing the UK back into the arms of the EU? British economist Philippe Legrain explains the shifting sands in the UK's relationship with the EU.

#Brexit was not just stupid, it was spectacularly badly timed.

Stupid, cos disrupting trade with your main trading partner is inevitably costly.

Badly timed, cos Brexiteers envisaged the UK embracing the US & a free-trading (and peaceful) global future. 🧵

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Will the Iran war plunge Europe into recession? In the 1970s, two big oil shocks sent inflation soaring and depressed Europe’s economy. Could history be about to repeat itself?

Longer term, though, accelerating the climate transition would enhance both energy security and business competitiveness.

My latest for @brusselstimes.com

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These look set to push up #inflation and depress economic #growth.

#Stagflation beckons.

#EU policymakers have options to ease the short-term pain, but they are limited.

Will the Iran war plunge Europe into recession? In the 1970s, two big oil shocks sent inflation soaring and depressed Europe’s economy. Could history be about to repeat itself?

Will the #IranWar plunge Europe into recession?

Amid unprecedented disruption to global oil and gas supplies, it now faces a triple blow of higher energy costs, inflated borrowing costs and increased uncertainty. 🧵

#econsky

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Employment rates for non-EU born are now *above* those for the UK born.

Gap used be nearly 10 percentage points.

A tribute to the success of UK immigration/immigrants and labour market integration, especially in recent years.

Something government should celebrate..

How to revitalise Europe’s economy "Europe’s core problem is that it has a corporatist economic model that favours big established companies."

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@brusselstimes.com

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While many things need to change, at EU level there are 3 big levers for economic reform:

deeper integration in the EU's incomplete single market,

lighter-touch regulation for smaller companies and innovative sectors, and

increased investment, not least in venture capital.

While the EU has suffered big external shocks in recent years - Russian energy, US tariffs, Chinese competition - the core problem is its corporatist economic model, which favours established companies in mature industries over innovative startups in growth sectors like tech.

How to revitalise Europe’s economy "Europe’s core problem is that it has a corporatist economic model that favours big established companies."

#EU leaders have just gathered for yet another discussion on how to make Europe's economy more "competitive".

That's the wrong target; the aim should be to make the EU more dynamic. 🧵#econsky

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The new gold rush: Why investors are suddenly flocking to buy gold The price of gold recently hit a record high, before falling back. Is it a bubble, or are there valid reasons for this rally?

The caveat: if gold becomes a more mainstream financial asset, it may lose some of its safe-haven properties.

Read my latest for @brusselstimes.com

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And it can also offer a decent return. Ignoring the past year's exuberance, gold appreciated by an average of 9% a year between Jan 2000 & Jan 2025.

Clearly, speculation is part of the story. FOMO has amplified fear of geopolitical & financial turmoil.

But in a time of war and Western sanctions, geopolitical upheaval & loss of trust in the dollar, gold is also a valuable form of insurance that has stood the test of time.

The new gold rush: Why investors are suddenly flocking to buy gold The price of gold recently hit a record high, before falling back. Is it a bubble, or are there valid reasons for this rally?

The price of #gold has plunged over the past week, but is still up more than 10% this year and has nearly doubled since the start of 2025.

Is it just a #bubble? Or are there sound reasons for gold's safe-haven appeal?

www.brusselstimes.com/1949906/the-...

Sathnam Sanghera: Help! I’ve fallen out of love with reading The writer stopped picking up a book for pleasure some time ago, choosing box sets and social media instead. Here’s how he got over his reader’s block

My guide to getting over reading block in @thetimes.com

www.thetimes.com/article/12c0...

Europe needs independence from Trump’s America "The storm over Greenland may have abated for now, but Europe’s relations with Donald Trump remain grim."

Conclusion: We need a fortress Europe militarily, but not economically.

Check out my latest column for @brusselstimes.com

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Why the EU’s new trade partnership with Mercosur matters "Against the backdrop of Trump’s aggression, Europe and Latin America need to cooperate more."

Third, develop & deepen partnerships that bypass US with

1) like-minded powers eg #Canada, #Japan, #Australia & #UK

2) emerging powers eg #India & #Mercosur, and

3) cooperate with #China eg on climate change.

This explains why EU-Mercosur deal matters btw

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1) Invest massively in EU #tech (& deregulate);

2) Accelerate #energy transition to reduce US gas dependency

3) Issue more EU bonds to boost #euro's global role.

Second, reduce Europe's economic vulnerability.

Contrary to Trump's claims, EU-US trade is broadly balanced. So if Europe could defend itself, it could stand its ground economically.

But still diversify away from US, especially in areas Trump can use as leverage: eg tech, energy, finance

France & UK, Europe’s existing nuclear powers, should also develop a nuclear deterrence strategy for defending Europe if Trump won’t.

With a defence splurge, a drone wall & an enhanced nuclear deterrent, Europe could better defend Ukraine, deter Putin & resist Trump’s blackmail.

2) Invest massively in Ukrainian drone production to aid its defence & erect a drone wall along Europe's border with Russia.

3) Develop joint nuclear deterrent among #NATO countries that surround #Baltic Sea. Sweden & Finland have nuclear reactors & expertise to develop nukes

Top priority is #defence. While fully replacing US role will take years, big progress can be made quickly.

1) Spend much more, now. #EU borrowing ideally, raise taxes/cut spending otherwise. The state’s top priority is to defend its citizens. Failing to rearm is a false economy.

Europe needs independence from Trump’s America "The storm over Greenland may have abated for now, but Europe’s relations with Donald Trump remain grim."

After the #Greenland crisis, Europeans need to face facts: they can't rely on #Trump to protect them from #Russia; indeed, he too poses a threat.

It's time to accelerate plans to reduce Europe’s military, economic & tech dependence on Trump’s America.

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