UK goods exports to the European Union could have been between £3.7bn and £6.5bn higher each year from 2021 to 2024 if Britain had secured mutual recognition of product testing, according to new analysis from the Institute for Public Policy Research.

The thinktank says some UK products must undergo additional testing and certification before entering EU markets, creating costs and uncertainty after Brexit. It estimates the upper-end loss at about 0.18% of GDP.

The sectors with the largest estimated annual gains from a mutual recognition agreement are motor vehicles and parts (£2.48bn–£3.42bn), electronics (£1.17bn–£1.67bn) and pharmaceuticals (£0.74bn–£0.82bn).

IPPR says its analysis tested alternative explanations including Covid disruption, supply-chain changes, sanctions on Russia, energy shocks and changes in re-export patterns. It argues a deal based on ‘dynamic alignment’ would reduce duplicate testing while keeping British and EU product rules in step.

The findings are an estimate, not a direct count of lost orders. Their policy significance is that they put a price range on one practical barrier in the UK–EU trading relationship.

The government’s next choice is political as well as economic: whether to pursue closer technical alignment in exchange for lower trade friction, or accept continued duplication as the cost of regulatory divergence.