Emily Thornberry, the Shadow Foreign Secretary, suggested Labour would give up the freedom to sign independent agreements – arguing that staying “in a partnership” would bring bigger benefits.
However, it is certain to be seized on by the Conservatives as evidence that Labour cannot be trusted to deliver on the referendum result – including, it is argued, the wish for an independent trade policy.
Interviewed on LBC Radio, Ms Thornberry said Labour wanted to negotiate a new agreement that would be “pretty much like the current customs union”.
Asked if that would mean Britain would be unable to strike its own trade agreements without the EU’s approval, she replied: “No, I wouldn’t put it that way.”
But she added: “I would say that we would take advantage of being in a partnership with the European Union in order to be able to, for example, negotiate with China.
“China wouldn’t just be negotiating with Britain – it would be Britain and the European Union.”
Ms Thornberry suggested Brussels would embrace the benefits, adding: “The European Union would have the advantage of not only negotiating on their behalf, but they would have the additional clout of being able to work in partnership with us.
“We bring the additional clout of our large economy and we would have to – as a quid pro quo – be involved in forming those relationships and making sure those rules were in accordance with British interests.”
The new customs union plan increases the danger for Theresa May that she will lose a looming Commons showdown on leaving the trading arrangement.
The vote has been shelved for at least two months, prompting accusations that the Prime Minister is “running scared” from a clash that could humiliate and weaken her.
Mr Corbyn’s policy towards the customs union and the single market is “evolving and deepening”, a shadow cabinet colleague said this week.
His stance is shifting amid a growing recognition that leaving the EU’s economic structures threatens the return of border posts and customs checks on the Irish border.
Labour has also been influenced by the leak of the Government’s own Brexit analysis, which suggested only tiny gains from an independent trade policy.
It forecast a boost of just 0.2 per cent to GDP over 15 years from a deal with the US, for example, failing to compensate for the losses from EU withdrawal.
In stark contrast, the analysis found that output would be 8 per cent lower than expected under a no-deal Brexit, by 5 per cent with a free trade agreement and by 2 per cent even if there is a soft Brexit.
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