Director Weekly  With UK exporters facing a challenging environment in 2026, government efforts to deliver new trade deals and improve arrangements with the EU will be crucial.

In truth, the trading environment began changing long before President Trump returned to the White House. Covid disruption, the invasion of Ukraine, tension over Taiwan, and of course Brexit: the combination of geopolitical uncertainty and increased costs have all served to disincentivise UK firms from pursuing export opportunities.

Yet despite those challenges, exporters have persevered. In the year to October 2025, UK exports were up 5.2% to £929 billion. Our own most recent data, from December 2025, finds that net expectations among IoD members are for their businesses to increase their exports year-on-year over the next 12 months. Globally, however, trade is expected to slow – after 3.8% growth in 2025, the UN forecasts growth to slow to 2.2% in 2026.

Amid the continued uncertainty, the government’s efforts to support exports are critical. In fairness, its track record here is more impressive than in other policy areas: last year’s deal with the US shielded the UK from the worst effects of the tariffs, while the free trade agreement with India and pragmatic measures to improve EU trade were also welcome.

But what’s on the agenda for 2026? These are the key areas to watch.

1. Progress on the UK-EU reset

The EU remains by far the UK’s biggest trading partner and further progress on the much-vaunted “reset” will be at the top of the government’s agenda.

One of the biggest – and most controversial – developments will be the unveiling of a ‘Brexit dynamic alignment bill.’ Ministers want to streamline the process of aligning the UK with EU regulation in selected areas, ensuring continued access to the EU’s markets as the bloc becomes increasingly protectionist.

The IoD has strongly supported efforts to bolster UK-EU trade and reduce border frictions, but exporters may be more sceptical about trading-off sovereignty in exchange for market access. (We’re surveying members on this very topic soon.) Mutual recognition of applicable standards could be a better option.

A five-year review of the UK-EU Trade and Cooperation Agreement (TCA) will also take place this year. This will focus on the TCA’s implementation, not its substantive provisions – but may still be an opportunity to revisit the details.

Watch for progress around the next UK-EU summit, potentially in the early summer.

2. Implementation of recent agreements and pursuit of new deals

Work is still needed to implement the UK-India Free Trade Agreement, with legislation yet to be introduced in Parliament.

Implementation of the Economic Prosperity Deal with the US is also incomplete. Disagreements remain, not least around food standards and the treatment of tech companies: the US strongly objects to the UK’s Digital Services Tax.

Meanwhile, the government hopes to complete new deals during the year. Negotiations on a free trade agreement with the Gulf Cooperation Council are ongoing, as are talks with Turkey. The details of any deal will be particularly interesting, given Turkey’s customs union with the EU.

3. Supporting UK exporters

The IoD will also be engaging with the government on ways to improve support for exporters as it implements last year’s Trade Strategy.

Given the challenging environment for trade, we know that UK exporters need to be ever more adaptable. That might mean shifting away from risky markets – which, as some IoD members tell us, may include the US – and focusing on markets with more stable trading arrangements. There’s more government can do to support SMEs, in particular.

As challenging as the global trade environment may be, there are still real opportunities ahead. There are reasons to be optimistic about the outlook for exporters in 2026.

Read our Chief Economist’s response to November’s rise in UK GDP here.